The startup culture in India has gained significant momentum and more investors are willing to place their money in new ventures While the thought behind a replacement business venture is vital , there are several other aspects that investors examine before they plan to fund a startup Here are some key points that startups seeking funding should remember before approaching an investor:
Capable Team
More than the thought and therefore the concept of the startup, the foremost important thing that the investors check out is that the founding team members. Investors got to be convinced that the team is capable enough or has competent skill-sets to execute what they’re getting to do.
Most mature investors silently see the tuning, trust and loyalty between the team members also . If they’re investing during a team, they need a rock-solid one. So, I strongly suggest you simply work with people you’ll spend your whole life with. It’s like trying to find someone to urge married to. You don’t want to require hasty decisions.
Investors also attempt to understand if you’re financially responsible. They’re getting to offer you an immense load of funds in your checking account to handle. One must have full faith that you simply won’t go rogue or even even have a attack after seeing an excessive amount of money in your checking account .
Ask for the proper amount
As an investor and a financial consultant to several wealthy individuals, you’ll be surprised if I tell you about the amount of startups I see daily with great business ideas and posing for the incorrect amount.
It is more dangerous to invite a lesser amount than to invite quite what you would like . Founders got to pay themselves an honest salary also . A startup must have enough funds in their bank to either reach some extent where they’re profitable and may survive on their own now or can raise subsequent round of financing.
Roadmap
Fancy revenue projections of 3-5 years may be a sham consistent with me. They don’t convince be correct in additional than 95% of cases. Very limited people can actually roll in the hay accurately for an early-stage startup.
So, consistent with my understanding, having an accurate roadmap is more beneficial than simply projections. An entrepreneur should focus more on “How will we achieve the target revenue?” than “We have xxx revenue projections for the approaching 5 years, and we’ll be billionaires within 3 years.”
Monetisation strategy and scalability
You should have a good idea about how will you monetise your offering. I personally don’t invest in startups where there’s no invite the merchandise that you’re offering to people, and you secretly make people your primary product.
Data is king, they say. Companies doing this thing are incredibly successful, even i’m their user (or you’ll call me a product for them). Most investors just like the monetisation strategy, clearly defined.
You need to know if your product is commercially viable or not and if people are willing to buy it. the simplest thing is to only exit of your room and ask random people about it.
It sounds weird, but it always works. you ought to even have a good idea about the scalability of your startup. Remember, the better and larger the scalability, the more investable it’s .