Startups — How to raise capital

Nine Important things to remember while approaching an Investor

Every morning when you watch the news, you will surely come across at least one story of a start-up that has successfully raised millions of dollars. Is it not amazing to see such positive news in these times? Investors’ confidence reflects their faith in start-up era that will be going to mint billions of dollars for them in medium to long term.

Start-up investment has been growing consistently in the last many years. Though few of the startup raising funds however many of them still find it difficult to woo the right set of investment partners. One of the major reasons is the lack of the right approach in terms of presenting their idea in an appropriate & impactful manner to investors.

There are a few important tips for startups on how to prepare themselves while approaching an investor. While preparing a presentation or any other documents keep in mind to cover the following things –

1. Company overview, mission, and vision
2. Key team players/founders with their background and skills — remember a solid and experienced team gives a lot of confidence to investors
3. Explain the Market problem that you are going to solve
4. Proposed solution and how it is better than the solutions available in the market
5. Market opportunity — this should be explained and measured in a logical and accurate way
6. Technology that is being used and how this is going to be a big differentiator?
7. Business model and marketing plan — Remember a business model and marketing plan reflects clarity of thought and execution ability.
8. Financial projection for the next 5 years — This should essentially cover projected revenue, assumption, and EBITDA.
9. Capital requirement and deployment plan of capital — Investor always want to understand requirement and how you are planning to utilize this money.

Last but not the least, the total number of slides in the presentation should not be more than twenty. Remember, there is sufficient money available in the market for startups who know how to sell their idea.