Ten Takeaways on Startup Funding

We recently caught up with startup investor and influencer, Ben Kepes; Canterbury Angels chairman, Paul Claridge; experienced business banker and financial advisor, Dave Armstrong; and Bridget on the subject of funding.

Here’s their ten takeaways on startup funding:

  1. Before you even think of external funding, consider simply bootstrapping.

  2. Fellow well known bootstrappers include GoPro and Atlassian – it ain’t glamorous or fashionable but growing your business through steady customer acquisition and sales revenue ensures a strong value proposition and means you don’t lose equity.

  3. What is the purpose of the fund raise?  Do you need to invest in R&D? Look first at grant options like Callaghan Innovation.  Smaller amounts? Consider peer to peer funding or crowdfunding.

  4. Are you at Early stage?  Consider angel investors who will want to see a proven value proposition and at least some early traction.  Large amounts? Venture capital often means losing equity and control.

  5. Think about your exit strategy and how each funding option can impact that strategy.

  6. Look at the people you are thinking of taking money from – do your due diligence – will they be a strong long term business partners?

  7. Large amounts?  Venture capital often means losing equity and control.

  8. Raising capital will always take twice as long, will be twice as hard, and will cost twice as much as you expect.

  9. Don’t raise money too soon – BOOTSTRAP!

  10. Never raise money under pressure – the time to fundraise is not when you’re on your last month of runway.