The following is a guest post by Innovate UK, the British government’s innovation agency. They are focused on finding British businesses and entrepreneurs who can use new science and technology to drive economic growth.
Follow Innovate UK on Twitter: @innovateuk.
Is your startup in need of some investment to keep the business on track? If approached the wrong way, getting together the sufficient funds can seem like a near impossible feat.
Investment is crucial when it comes to the long-term stability of any business, and you’ll need it if you hope to expand and grow over time. Enticing potential investors should be a priority when it comes to the future of your startup.
So how do you go about it?
To help you work out what’s best, we’ve brought together our top tips and tricks on how to ensure your startup funding success.
Whether you’re looking for new approaches to pitching your startup, or simply want to see what’s best for your business, we’ve got everything you’ll need below with our guide to startup funding.
Be Aware of Your Funding Stage
You’ll need to be familiar with the funding stages, as each one differs and can affect your business. Knowing which one you’re currently in is vital!
Evaluate your position and ask several key questions. How far along development is your product and are you earning real profits from your services? Being aware of your funding stage will help steer you toward the types of investment you should be seeking.
Potential investors will want to see that you understand the boundaries, expectations and abilities of your company in a realistic and grounded manner.
Determine Why You’re Asking for Funds
The amounts you ask for will need to be appropriate, realistic and within your future targets as a startup. Knowing the requirements of each funding stage, as well as the ideals and demands expected will help you when it comes to pitching to backers.
Show clear, concise reasons for your requests, and establish where and how the cash you acquire will benefit your business. A strong, personal and confident approach will help show the best you have to offer.
Knowing your reasons for funding is key!
Research Your Targeted Investors
Always make the effort to look up and research those you’ll be pitching yourself to.
Familiarise yourself with the general behaviours and risk appetites of investors. What they’re looking for will differ at each stage, so knowing how they’re likely to act will help when it comes to pitching!
The types of backers you’ll attract will also be based on your business milestones, current progress reports and financial needs. Keep up to date on all three and be conscious of the different investors you might attract. You’ll want to ask for the right amounts in order to ensure success.
Misjudging this could seriously hinder your efforts!
Get Your Timing Right
Determine which areas of your company you’re looking to expand and focus on moving forwards.
Knowing where your efforts need to go, as well as what you need to prioritise when progressing to the next funding stage, will make obvious the optimal time to pitch yourself to investors.
Getting it right will mean you can avoid coming up short at a later stage when fresh backers are interested.
In need of some more guidance when it comes to business ventures and all things start-up? Be sure to follow Innovate UK on Twitter and subscribe to our YouTube channel for the latest news, tips and advice.