- For many budding entrepreneurs, the idea of raising initial funding can be incredibly intimidating.
- It is important to go into the startup process with your eyes open about just how difficult it can be to achieve success.
- It is necessary to emphasize on the importance of taking the right fundamental steps when establishing your venture.
Here are some important tips for raising a successful startup career.
Drafting a Business Plan
While this seems self-evident, many anecdotal accounts of project leaders showing up to a pitch meeting without any business plan have been heard. Venture capital firms can receive upwards of 1,000 proposals a year, meaning that they have to quickly filter out unprepared teams. In many cases, not having a business plan can be a one-way ticket to rejection.
VCs are not charities—ultimately, they want their investments to provide returns. If you can’t confidently explain how you will navigate your project from the initial stages to a place of success, it is hard for investors to see the potential.
Creating a Minimum Viable Product
In the startup world (especially in the blockchain industry), we notice many projects seek funding before developing any sort of working product. While this can work, one of the easiest ways to separate yourself from competing proposals is to create an MVP. For example, when seeking early-stage investors, we were able to create an early version of our product that provided a clear vision of how the crowdfunding platform would work.
Targeting The Right Venture Capitals
Favorable market conditions over the last decade have expanded the number of VC groups. Due to this, it is important for founders to do their own research and learn as much as they can about potential investment partners. Compiling a list and then using guiding questions like these to aid your search with questions like:
- What is the reputation of the firm? Do they have a track record of success?
- What types of projects does the firm tend to invest in?
- Have they invested in any projects that you have a direct or indirect connection with?
Asking questions like these can help to identify which firms may be a strong fit for your particular idea.
Keeping Track Of Competitors
A thorough examination of the competition should be a key part of the planning stage for any new project. Similar to the process of evaluating VCs, go about this process by making a list of both established and newer projects in the same market segment and answering some key questions about each.
- What does the performance of this competitor tell you about market demand?
- What are the strengths of this competitor?
- What are the weaknesses of this particular competitor? Can you exploit these weaknesses ?
Going through the above process will achieve several important things. First, it will give you a well-rounded background knowledge of your market segment. Second, it will help you identify areas where you will need to expend additional resources in order to negate the advantages of your competitors.
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Source: Forbes
