Underestimated Fundraising Methods For Your Startup

According to Fundable, 57% of startups get loans, and 38% are launched thanks to a connection’s financial help and/or intervention. You don’t have savings or relatives who could invest in your idea? That’s not a reason to give up on your business launch.

These days, startups have entered the market at huge value, which brings a large return for their early investors. That means VCs possess more money to support new startups. In addition, more and more nontraditional early-stage funders are beginning to take shape: mutual funds, private equity firms and hedge funds. Sounds like there’s a good chance to raise money for your startup without debts, but how to do it?

Attracting investments, especially if you are a first-time founder, might seem an overwhelming challenge. It’s hard to get into an investor’s sight, and even the most successful pitch does not guarantee interest that will turn into a funding round. Here are three essential steps to build awareness about your startup and increase the chances of raising a round, which help attract investments.

 

Step 1: Establish yourself as a thought leader.

As long as your name isn’t loud enough to be well known in the industry, your emails probably have a low response rate, and this can affect the pitch conversion. Imagine the situation: Your well-written letter is noticed by investment managers, and the first thing they do is google you. It’s awesome if you get impressive and meaningful search engine appearances with confirmation of your credibility from various sources, isn’t it?

In order to get noticed by business angels, brand yourself as a specialist who totally understands the market. Use the power of content to prove that you know exactly what challenges the consumer is facing, and focus on the benefits of your product. You can start mastering PR with expert columns in local and global media outlets, guest posting, video interviews, podcasts appearances or even LinkedIn blogging. This will set you apart from the crowd of competitors in the fight for investor money.

 

Step 2: Make time for research on potential investors.

Just as well as you have researched your audience of possible clients, you have to figure out what your audience of potential investors needs, too. Each venture capital fund or angel investor has its own specialized area, preferred stages of investment, or other specific metrics.

Seek who invests in your niche and research everything you can find about them. Follow public announcements on the websites, find blog insights, seek social media publications from investment managers or general partners and put everything into a nice contact database. In addition to detailed information about the target investors, get a generalized image of your target audience, which you can use later when creating ads on Facebook.

For more accurate targeting, you need phone numbers and emails of business angels. To get this, you can create a classic lead catcher to give a certain value to the audience in exchange for their contacts. Conduct research about similar startups through the investors’ eyes, and target it to those who could potentially invest in your company. Then take a look-alike from this audience and expand your investor targeting.

 

Step 3: Use content marketing and targeting.

At this point, you’ll need the publications or media appearances you got before. Place the links to your resources and move on to the marketing part. Set up targeted publications advertising, so that potential investors from your contact base can discover it.

 

Don’t underestimate fundraising PR.

The main thing for your startup team is to work on the product, improving customer experience and making iterations to scale. But if the founder spends resources to share expertise online, it increases recognition, credibility and trust.

Bonus tip: If possible, identify the investor’s phone brand when meeting with them. With this data, you can target published articles by geolocation and phone brand.

PR and marketing should not be underestimated in the fundraising process, even sticking to the idea that the main thing is to focus on the product. Spreading information about founders’ expertise before going to an investor for money can result not only in an increased email conversion rate. It’s a way to gain trust from investors, build a brilliant network and raise money faster, if approached wisely.