Sufficient seed capital is essential for a startup to become successful – but many founders find it difficult to acquire investors. Here are our tips on how to make your fundraising project a success.
Fundraising is not just about scoring points with investors with an excellent business idea. Investors must be convinced to invest with a combination of facts and numbers and a good dose of persuasion. Many founders struggle with attracting investors and gather sufficient startup capital for their project. At our Workshop Day in early September, experts from the NMA network gave our startups valuable tips on fundraising. We have summarized the most important points for you.
! Find and select investors who fit you
You should research in advance which investor is most suitable for your idea, mission and vision. Investors receive several business plans every day and make their selection based on their business interest. So avoid unnecessary rejections by learning about the diversity of different investors. Accelerator programs like NMA are helpful for this step – for startups and investors. Investors can be sure that the startups have successfully completed the initial founding steps and have reached a level of maturity that suggests a successful investment.
! Don't get too many investors on board
The idea of quickly acquiring many investors may seem tempting at first glance. But if too many different people own shares in the company, this can lead to conflicts and unnecessary delays because many people then also have to be involved in all steps and decision-making processes.
! Get your core message across smartly
In your pitch, state clearly and in simple terms the core message of your startup.This makes it easier for investors to convey the message within their own company or to other investors – and to make others enthusiastic about your mission in this step.
! Set rules for the cooperation
Once you have found an investor, you should define the guidelines for cooperation: How much contact and support do you need? Accept objective criticism. Remember: It serves to push the product and help the startup become successful. And very important: Always stay in contact with each other. Because only those who communicate with each other and at eye level can also work together successfully.
! Do not praise more than you have to offer
Be authentic and reality-based in your pitch. Do not price more than you have to offer. The fake will be exposed faster than you might think. And then the sugarcoating will take its revenge. It's good to have optimistic (doable) visions of the future. But declare them as such and don't pass them off as an actual state. By concretely presenting and implementing the current problems and related solutions, it becomes clear that you can set realistic goals and are able to keep agreements.
! Prove that you are a well-coordinated and united team
Make sure you are solid as a team. You need to prove that you are on the same page and have internalized the same vision. With an ambitious, cohesive team, the product is more likely to succeed. Dysfunctional teams won't make even the best product a success. Investors know that
! Stay on the ball, even if you fail
Take the feedback of your counterpart seriously and practice your critical faculties. Keep your eye on the ball even if you receive a rejection after your first pitch. For example, contact the investor again after six months and show how you have developed and which obstacles you have overcome. This way you can prove that you can set realistic goals and have now achieved a more stable product. This can also lead to a cooperation at a later stage.
About the Workshop Day:After a long time apart we were finally able to host an event to get to know each other not only online, but face-to-face. The startups and investors participated in exciting panel discussions. Especially the topic of funding is an important step for the startups and therefore we hosted a panel about fundraising. Our guests were Johannes Weber (HTGF), Jens Schumann (Advisor and Business Angel), Anna Lena Gruner (J.F. Müller & Sohn AG) and Joshua Müller (dtcp.capital). The startup founders were able to ask specific questions and learned a lot!
Photos: Bastian Funk
Words & Photos by Mathilde.