Entrepreneurship has been a long journey for me.
In a way, it has been a culture inculcated by my parents into my brains ever since I was a child.
Here are valuable fundraising tips I’ve learnt along the way.
Clients have to be happy
My late father used to love sharing his business ideas. He would always encourage me to keep my eyes open for opportunities.
I recall going on holidays as a child and exercising business creativity skills with him. He would hold my hand while walking down the main road in Riccione (a holiday destination in Italy) and point out some stores, commenting on what they could have done better to attract more clients.
Then, later in the evening, he would bring up some business ideas during dinner, always focusing on the customer as a central point.
Therefore, I grew up thinking of ways to make clients happy.
Of course, there were many mistakes made but the foundation I received from my dad turned out to be one of the most useful skills I have learned.
The skill of connecting with investors
Over the past few years, I became interested in the startup culture as an alternative way of doing business.
My father couldn’t really grasp the concept of “Tech Valuation”. His approach was more like “brick and mortar”.
He could not clearly understand why a tech startup could have been worth billions while being at a loss.
I admit that sometimes that doesn’t make sense to me too. Take Uber for instance — worth in the billions while losing billions.
My father believed in bootstrapping businesses: you put your money in, work hard, take your profit, re-invest in your business, repeat. But, I recall a lesson I learnt from another great man and an extraordinary entrepreneur, Mr Giuseppe Fornasari, who once told me:
“An entrepreneur cannot complain about lacking capital for investment, because sourcing capital from investors is as crucial as executing.
If you can’t get investors to trust you with their money, you are not an entrepreneur.”
As harsh as it sounds, this is the main reason why so many entrepreneurs fail in their business.
Recently I have been part of a success story, where one of my businesses was funded by a third party investor.
Although it is such a rewarding experience, the joy is somehow numbed by the fact that funding is not a goal but a start towards further business expansion.
Thus, the ability to fundraise, although crucial, cannot be seen as the only necessity.
The world is big
From an implementation perspective, everything becomes easier when a startup is funded, especially when looking at the soft spots in the market.
For instance, a startup with no funding follows the entrepreneur.
If the entrepreneur is based in a country, there most probably won’t be a relocation — even if needed — until funding is achieved.
Subsequently, after funding, an entrepreneur would need to look at the industry from a geographic expansion perspective. Ideally, such an analysis should take place even before the fundraising exercise.
Some entrepreneurs tend to look at their industry strictly within the comfort zone of their location, hence performing poorly when attempting to expand to other countries.
A wiser approach is to plan ahead which country “needs your startup” the most. Similarly, which country has the easiest regulation for your startup to exist.
Once pinpointed, fundraising becomes simpler because usually investors can be categorised by stage, industry, and geography.
This approach worked like magic during my last fundraising because I was able to look at the world map without restrictions, tailoring my pitch to investors based on their geography of interest.
Of course, the stage and the industry were already a match.
I believe that, firstly, a startup should keep its focus on customer satisfaction when designing the product or service.
Secondly, it is absolutely essential to have access to investors and work on gaining their trust.
Lastly, it pivotal to look at the world map and do the homework, find out where else you should go next.
Lacking any of these three requirements would cause a possible pitfall.
I see this happening all the time with food-related businesses. For instance, one should never assume that what they like is what the rest of the world likes.
Similarly, don’t assume that if you have a habit, everyone else will have it too. That’s the unfortunate case of food delivery services — so popular in some parts of the world, and totally useless in others.
Another example is looking at the problem/solution at a local scale.
A Russian citizen might think that a professional social network is absolutely needed, but that would only be applicable to the few countries where Linkedin is not accessible or available.
In both examples, the chances of reaching investors interested in a global scale startup would be slimmed down, resulting in a potentially successful local startup or another imminent shut-down.
Photo by NeONBRAND on Unsplash
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