Founders are often frustrated by the fundraising process. Many founders try to raise investor capital before they should. Unless you are a serial entrepreneur with a successful exit that made significant profits for past investors,
professional investors will want to see a some key items checked off before they consider you “investment ready”.
Problem
New founders will generally start their business with their own funds (bootstrapping) or money that they can get access to through friends and family. For many high growth businesses, there will come a point in the company road
map where a founder may seek funding from outside professional investors.
Many founders don’t understand what angels consider “investable”. As a result a founder can greatly improve their chances of standing out and getting funding by making sure that they have what most investors consider the foundations
of a good investment.
Solution
Before you approach investors, you should have at least 7 key elements, including:
• A need or pain point that is being addressed
• A big market
• A business model
• Competition
• Team
• A go to market plan
• A road map
The elements for being “investor ready” are not just for people looking for outside capital. These are things that every business needs to have a strong foundation for future success. Don’t leave thinking about these things until
it’s time to raise money. You should be thinking about all of these to decide for yourself if the business is viable and how you will execute.
