7 Things to Do Before Launching a Seed Round
expressed opinion entrepreneur Contributors are themselves.
As a founder and CEO, there is nothing more exciting than seeing your business take off! Ask any successful entrepreneur about their journey and most of them will share how their business got started. The world loves companies that start out with a small team working on an idea. Companies like Google, Apple, Amazon, Hewlett Packard, Mattel, and Disney started in garages, while Facebook, WordPress, and Napster started in dorm rooms.
While some of these stories may be romanticized, every aspiring entrepreneur has heard them and dreamed of following the example of the visionaries behind them: undaunted by expectations, undaunted by hardships. However, due to the efforts of their predecessors, most entrepreneurs will have more choices than their heroes originally had.
Related: 5 steps to keep in mind when making a seed investment
more options, more questions
Today, despite turmoil in 2022, startup funding has broken record after record over the past few years. For entrepreneurs, that means there are plenty of opportunities…but few more than their seed round.
If you want to gain momentum to bring your idea to life, a seed round of funding will be indispensable to ensure you can do so. While you may already have some disposable capital and some infrastructure to start your venture, in most cases this is not enough. After all, equipment, offices, staff, and technology cost money.
So, there isn’t a whole lot going on when it comes to making sure your startup gets the seed funding it needs to survive its initial stages. Don’t lie: While there are more financing options than ever before, the competition is fierce. Fortunately, there are steps you can take to increase your chances of success.
Related: Setting the stage: What a seed round means for your startup
How to make sure you are ready
If you ask experts, founders and investors what these steps are, you will get many different answers. However, I believe that most people who have succeeded in the startup ecosystem will agree with some of these points. I believe that by making sure you complete these checklist items, you will get a lot closer to getting the money you need to start:
Material: Make sure you have everything you need – such as presentations, pagers, rigorous financial models, product demos or MVPs, relevant videos, and more. Providing relevant information to your potential investors in a coherent, specific and well-presented manner will ensure that no pitch effort is wasted.
There is a list of target investors: This list of targets may include early-stage venture capital firms, strategic investors, incubators, angel investment groups, personally wealthy angels, or any other source of seed funding. What you need to be sure is knowing what opportunities are available to you and who you are going to market them to. You should take this into account when creating materials.
Have your cheat sheet ready: About 80% of the questions founders are asked are common and easily accessible. Be sure to study them and keep them (and the answers) in mind before starting your presentation. This can be done by preparing and keeping an updated cheat sheet. Remember that you need to work hard to provide efficient, short, and to-the-point responses, because while longer responses may be easier, they come at a cost.
Do your homework for each investor: It’s your job to maximize the effectiveness and value of your meetings. The world won’t take you one way because there are so many options in front of the person you’re pitching to. You need to carve a path for yourself by standing out and proving that you are the best choice for them.
Your opinion: When it comes to starting a business, perseverance is essential, and all investors know it. So when you reach out, they’re sure to take a quick look at your background. Make sure your profile, your startup profile and general information reflect your passion and qualifications. By doing this, you can ensure that you will get the attention of potential investors.
Opening remarks: Everyone knows how important first impressions are. Unfortunately, many founders struggle to start the train or get it into the right lane. To make a great first impression, make sure you have a strong opening statement to start your routine, or a framework to get the right train onto the right track early. If you master the art of first impressions, most everything else will follow.
ask: As a founder running a seed fund, you’re not only looking for capital, but also for connections, support, and more. Make sure to let your potential investors know what you need from them by avoiding ambiguity and creating a timeline. This needs to be very clear, clear and concise. If possible, remember to schedule a follow-up call or meeting during the week to discuss their thoughts. By doing this, you can make sure they are committed to it.
Before you start your seed round, make sure you have checked all of these items above. Again, there are many opinions and strategies, but making sure you have completed these seven steps will definitely increase your chances of success.
Related: 3 Questions to Ask Yourself Before Pitching Investors