How to convince investors
Fundraising for your startup can be a challenging task. If you decide to start a fundraising process it will consume a lot of your energy and focus for the next 6 to 9 months. For most founders, fundraising is an add-on to their existing job of being the driving force in their company. So how can you succeed?
“Understand why your startup is worth investing in, then simply explain this well to investors.”
Invest time in good preparation
In the quote above from Paul Graham, it sounds quite simple: Addressing the right potential investors with a well written and self-explanatory investment proposal is the key for getting an invitation for a first meeting.
Of course, for you to be able to write this investment proposal, you need to have thought about your marketing strategy, your product development roadmap and you need to have a financial plan that ties everything together.
Knowing that attractive investors are being overwhelmed by about 200 unsolicited investment proposals per week, it is important to address the right investors with a great proposal and a personal message, best done via warm contacting.
Calculate a plausible and reasonable valuation
How much of your startup are you prepared to give as a share to an investor? What valuation method should you use? How will you invest the capital raised and for how long will it last in a worst case scenario? These are the questions you need to be able to discuss with potential investors.
Go into negotiations with confidence
Be prepared to explain your projections, to talk about the drivers of your business case and the benchmarking data you used. You must also have a plausible and justifiable explanation of your serviceable addressable market and a unique selling proposition.
For investors, negotiations with startup founders are daily business. To be able to negotiate term sheets, again, excellent preparation for each and every meeting is key. The preparation covers any off-the-table tactics (whom to talk to, process set-up, etc.) as well as defining your interests and your best alternatives. Starting from your first assessment of the investor’s interests you develop options to suggest during discussions.
Follow our step-by-step process
The key to successful fundraising is good preparation and starting early enough.
We’ve created a step-by-step guide that provides you with a structured process that is easy to follow. It covers all the relevant areas and gives you specific instructions on what to do for your preparation.
How we support startups in capital raising
A One-Stop-Resource for Becoming Investor Ready
key2investors.com is for all entrepreneurs and founders who want to maximize their chances of getting funded by professionalizing their funding process.
We guide you with a step-by-step framework through the process of getting investor-ready.
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The virtual_lab was very informative with a lot of useful things to make a better approach to investors.
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Petra helped us in structuring the key message and all relating documents for finding venture capital for a newly founded start-up in the field of green chemicals. Petra also provided us contacts and venture opportunities for our mission. We totally appreciated Petras very experienced, well skilled but still hands-on way of working with us. Petra is perfectly capable of sensing what her customers really need. We really learnt a lot! Thank you Petra.
Petra Wolkenstein has supported and consulted us in several phases in a very professional way. Working together has been excellent when looking for new investors. She matched us with qualitatively valuable and very suitable investors. Her cross-border investor network is truly extensive. Many thanks for your excellent and proactive support!
Selling a company is a complex process. When I was looking for a buyer to exit my company, the experience of the consulting team helped a lot. In the end, the professional teaser documentation and the invaluable negotiation support were decisive for the sale.
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