Anyone who has worked for a startup knows how crucial fundraising is for your company and its longevity.
In this post, we’ll highlight seven strategies professional fundraisers use and how you can apply them to your startup.
1. Start with a clear set of goals
Don’t come into the fundraising process blind and expect to be satisfied with the result. Any experienced fundraising pro knows you need to start with at least one big goal. Once you have an overall goal in mind, divide it into smaller goals to keep your momentum going. You can read more about goal setting and planning in this post.
2. Set a budget
It’s definitely true that it takes money to make money. Expect that you will be spending some amount of money on your fundraising efforts. That could mean spending on presentation materials, special events, or hiring another person to support your fundraising.
3. Seek out the right folks
This is where your networking skills really come into play. You’ll want to enter your fundraising effort with a focused approach. Research potential investors, ask for referrals through mutual contacts, connect with a mentor, join online communities, and ask anyone in your network for their ideas.
4. Match your message to your audience
Once you have a handful of investors in mind, you should tailor your fundraising pitch to match the interests of whoever is going to hear that pitch. Your pitches don’t have to be wildly different. In fact, that would be bad. But they should highlight the points you think your audience will find the most interesting. Identify several types of audiences early on in your fundraising process and create presentations and accompanying materials best suited for them.
5. Tell a good story
You’ll want to present your startup as a clear, memorable brand. Be sure your pitch is concise and paints a picture about your company, its values, and what makes it unique. You want your investors to feel confident that they understand what they’re investing in and why you’re the right fit.
6. Be ready to address common concerns and questions investors may have
Once you’ve got a solid handle on your goals, brand image, and pitch sit back and imagine you’re hearing it all for the first time as an investor. What questions would you have? Does your pitch leave anything important unanswered? According to Forbes, investors are often thinking about factors like trends, your target consumers, level of consumer interest, key performance indicators, your startup’s ability to solve a problem or fill a gap, and how you’re taking advantage of your resources.
7. Be persistent, but patient
Just because a potential investor isn’t interested in funding your startup the first time doesn’t mean that they won’t change his or her mind in the future. Always be sure to stay in touch with potential investors, or at least stay in their contact lists, so you’re on their radar.