The recent Business Funding Show Investment Conference saw key personnel from the world of raising funds come together to discuss key issues experienced by entrepreneurs.
On how to survive the initial years with crowdfunders and accelerators , Dan Hardy of Crowdcube, Rose Lewis of Collider, Alex Dunning of Seedrs and Harry Davies Wayra came together to issues arising with early stage investment.
Should investment be the first item on the agenda for start-up companies
Harry Davies: Investment for start-ups at some point is going to be vital but definitely shouldn’t be the first thing thought about. Before you approach any investors you’ve got to prove that you’re solving a problem, you’ve got to prove that the product market is there, and that what you provide is a problem which people will pay to have solved. If you don’t have that then you need to rethink the business model. You need a team that can deliver on the goals needed to be achieved.
Rose Lewis: If the first thing, as an entrepreneur, you think about is money, the chances are you’re not really passionate about the product and that’s what investors are wanting to see in you.
I would say there’s a need to turn up to as many workshops that are put on as possible. Not turning up shows you’re not interested or arrogant and you think you know everything. Personally, we like open entrepreneurs who are willing to listen. We don’t always have the right answers either, but we want to know you’re open to new ideas and exploring different options for your business.
How do you get start-ups investment ready?
Dan Hardy: Before investment you need to network. Entrepreneurs are very giving with their knowledge and imparting their experience of gaining funding. There’s so many events out there for networking opportunities so whether you need office space or marketing advice, there’s going to be an event that you can network out to gain contacts.
People are protective about their business, a lot of the times but you need to get your idea out there and speak about it to gain an outside view and advice.
Harry Davies: Getting out there and speaking to people is important. But even more important is not to spend too much too early. There’s nothing worse than raising tons of money and then finding out that you’ve misspent.
The more validation you can do at the early stage, the better, it’s key to really enjoy the time building a company, it’s the most flexible you’re ever going to be in your journey. Once things start progressing it can be quite hard to take a step back and look at things that might not be working too well. Plus taking the leap to re-direct. Quite often the gut instinct is to just fundraise again, give it another six months, and hope it changes, but that’s not the best way to do things.
When companies leave an accelerator programme how much more well equipped are they?
Rose Lewis: When start-ups leave an accelerator, they are better equipped to face the challenges of growth and development – they have a bigger network, and continued support and advice. Programmes can also give them access to a number of investors, who can support them for life, forming a very powerful set of ambassadors for their product.
Missed this event? Why not fulfil your funding wishes this Christmas and join the Business Funding Show at its Christmas Networking Soiree with Funders (happening on Dec 11th at WeWork Paddington) where you can meet top investors and lenders and chat your way to business growth!
Alternatively, check out its annual flagship show BFS ’19 (happening on Feb 21stat East Wintergarden, Canary Wharf) – the only funding exhibition in the UK & EU – for your one-stop-shop to alternative business funding, no matter your stage or sector.