Startup Funding

Menu
Subscribe
Search
What is Your Competitive Advantage

What is Your Competitive Advantage

•
Fundraising

Related Guides

    Search Startupfunding above or view our

    Reducing the Fees in Startup Investing

    I’m a big fan of index investing as it’s a great way to reduce the cost of investing in publicly traded stocks and bonds. Index funds have less than 1% fees which compare favorably to some brokerages which charge 1% of assets under management or more. In the startup space the cost of investing is also a big factor. Investing in VC funds often come with hefty fees including 2% for management and 20% of the returns.  I’ve done revenue based funding but found the operational overhead can be expensive. Revenue-based funding requires monthly follow ups to calculate revenue and there’s the ongoing monitoring process.   At TEN we provide low cost tools for investing in early stage companies.  First, we’re not a broker so we don’t charge carry or other fees on the investment. We charge a monthly retainer fee to the company raising funding.   Instead of the traditional revenue-based fund model, TEN employs a redemption right in a convertible note as a means of providing a liquidity event for the investor. This alleviates the bank account monitoring and constant calculation of revenue. Hall T. Martin is the founder of TEN Capital and a builder of entrepreneur ecosystems by startup funding through angel networks, funding portals, syndicates, and more. Connect with him about fundraising, business growth, and emerging technologies

    Read More »

    How Fundraising is Like Fishing

    1 min read I meet a great number of entrepreneurs and have seen numerous approaches to raising funding. Some approach it as an opportunity to meet new people and explore another part of the entrepreneur ecosystem.  Others see it as a chore that distracts from the real business such as product development, selling customers, creating the next unicorn (take your pick).  Some bring their sales skills to the process and are quite good at meeting investors, listening to their concerns, and closing the deal. Others expect the investor to be bowled over by the idea, the pitch deck, the rock-star team (take your pick), or otherwise. When that doesn’t happen they look at it as a failed meeting. The key is to bring your best game to the meeting and treat it as you would fishing. In fishing, you have to set the bait and be patient for the right fish to come along. Just like you can’t rush a fish to take the hook so you can’t rush an investor. If you don’t get a bite in one place you can move to another location or you can stay where you are and change the bait. I see entrepreneurs setting specific time schedules for their raise. This is the same as casting the line and then saying “by 3:25 we will have our first fish”. The fish rarely work on your schedule. Investors won’t do so either. While a fisherman can throw a stick of dynamite into the waters to expedite the process, this is where the analogy ends as you can’t do that with investors, patience is still key. Read more in our TEN Capital eGuides: https://staging.startupfundingespresso.com/eguide/ Hall T. Martin is the founder and CEO of the TEN Capital Network. TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group

    Read More »

    What We’ve Learned Over the Years: How to Tell if Your Investor is Really Invested

    In today’s startup world every fifth person is an investor in some form or fashion. Startup investors call to discuss deal structures, valuations, or serial entrepreneurs. I can tell the difference between a serious investor and  a not so serious investor. A pretend-startup-investor likes the title of startup investment but won’t commit the time or money to make it successful. An investor that is not serious can waste a startups time. Here are some telltale signs of a pretend-startup investor the investor is not interested enough to visit the team’s HQ or meet with the team. the investor asks about the price first and then figures out the values in the business later if at all. the investor wants reports but doesn’t read them. the investor talks about helping the business but never finds a way to contribute. the investor glances at the due diligence documents but doesn’t dive deep enough to understand the business. there’s no investment thesis or guiding criteria for their investment choices they have no network in the target industry or startup world and can do little to help the startup post-funding. Hall T. Martin is the founder of TEN Capital and a builder of entrepreneur ecosystems by startup funding through angel networks, funding portals, syndicates, and more. Connect with him about fundraising, business growth, and emerging technologies

    Read More »

    What We’ve Learned Over the Years- How You Can Tell you are Talking to a Pretend-preneur

    The startup world is open to anybody, and it seems like everybody comes through it at some time or another. I receive calls daily from entrepreneurs seeking to start a business, raise funding, or hire a team member. I can always tell who is the serious entrepreneur and pretend-preneur – someone who likes the idea of running a startup but is not committed to the work required to make it a success. That’s important because a pretend-preneur who raises funding will ultimately waste it, and there are too many good startups to spend money on those who don’t see it through. Here are some telltale signs of a Pretendpreneur –They are more worried about job titles and credit for the work. –They don’t seem too focused on the customer and what it will take to make them happy with the product, as that’s a detail to be figured out later. –They focus on the superficialities of the business and not the core functions of building the product and selling it. –They look for ways around the hard work rather than working their way through it. — Problems are everyone else’s fault, and nothing can be done about it. –They don’t know who their customers are, and it doesn’t bother them. –They think funding will solve all problems and make life easier after the raise. –They don’t know their numbers, but someone else in their organization does, and that’s good enough. Everyone dreams of a successful startup and fundraise, but it takes more than a dream to be successful. Hall T. Martin is the founder of TEN Capital and a builder of entrepreneur ecosystems by startup funding through angel networks, funding portals, syndicates, and more. Connect with him about fundraising, business growth, and emerging technologies

    Read More »

    What We’ve Learned Over the Years- Venture Capitalists Engage in Brand Marketing

    In the past Venture Capitalists stood in the shadows of their successful portfolio companies. Venture Capitalists would hint about their contribution and use veiled wording in Twitter posts. Today we see VCs stepping up to take more credit for their contribution. There are numerous examples of VCs using successful exits to validate their investment thesis. With the explosion of the number of venture capital providers comes the need for VCs to engage in brand marketing. A list of successful portfolio companies burnishes their brand. It helps them gain new deal flow and limited partners and investors. Just having a fund is no longer a source of attraction for the best deals — there are too many other funds out there. Today, VCs have to position themselves as unique in expertise, deal flow, support, and connections. The startup has more choices to consider as venture capital becomes more abundant. VCs will have to promote their programs and experience more actively. VCs need to gain market exposure on their unique value proposition to generate deal flow which is the lifeblood of the VC business model. They are now brand managers who often have a business development and marketing team driving the awareness around their fund.     Hall T. Martin is the founder of TEN Capital and a builder of entrepreneur ecosystems by startup funding through angel networks, funding portals, syndicates, and more. Connect with him about fundraising, business growth, and emerging technologies

    Read More »

    What We’ve Learned Over the Years: In the Startup World Everyone Talks a Big Game

    In the startup world, everyone talks a big game and investors are looking for those who can do it. I love startup stories. In the startup world everyone has a grand idea and big plans to make it happen. It’s the venture world so you better have an idea that can be big. The talk around the ideas is large and full of hyperbole. The future is going to be so bright that you find yourself reaching for your shades. But then the startup has to actually build it and show the growth story in progress. Scott Adams once wrote- “Losers have goals. Winners have systems.” If the startup has some revenue traction then you probably have some systems behind it that you can grow. But what if they don’t have any meaningful revenue yet? One technique is to ask questions that go to the systems they will put in place such as: Tell me about your system for generating leads. Exactly how will it work? Tell me about your sales process.   Exactly how do you find the right prospect and close them? In other words, the startup needs to do more than just tell you their goals in your PowerPoint slide deck. They need to describe the systems they can put into place to do so. If the answers are vague and fuzzy, then it’s going to be a long, slow climb. If the answers show expertise and experience around it, then this one has potential for investment. Read more: https://staging.startupfundingespresso.com/education/ Hall T. Martin is the founder and CEO of the TEN Capital Network.TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group

    Read More »

    What We’ve Learned Over the Years- Startups Raising Funding

    TEN Capital is ten years old now. We’ve picked up a few lessons along the way in helping startups raise funding and helping investors fund those startups. Here are some key principles for startups raising funding. Key Principles Launching a startup and growing a business is hard. It’s supposed to be hard. Funding is an enabler. Don’t think funding is going to solve all your problems. Entrepreneurs think investors want big revenue, but what they really want is predictable and repeatable revenue. In an early stage company the revenue is never large, but if it’s predictable based on recurring revenue, repeat revenue or known lead generation funnels that generate consistent revenue, then you have a growth story to tell the investor. Build and test your funnel so you know it works and can tell the growth story versus telling the “we’ll be big someday” story – which nobody buys. Sweat equity is table stakes- not valuation metrics. You need a complete team to start a business- someone building it and someone selling it. No fair, everyone on the team is building it and no one is selling it. Being all-in on your startup is step one. Part-timers need not apply. Sell it first, build it second. If you can’t sell it in the first place, there’s no need to build it in the second place. Most startups over invest in their tech and then they search for someone to buy it. A better strategy is to sell it and then build it out with the customer’s input. Startups who purposefully avoid revenue generation and call it a strategic decision are going to find out what hard living is all about. It’s best to generate enough revenue to prove your model and business rather than keep it at zero and play the “it’s going to be big” game on valuations. If all you do is take, take, take – don’t be surprised to find your startup ecosystem to be small. Pay it forward. Hall T. Martin is the founder of TEN Capital and a builder of entrepreneur ecosystems by startup funding through angel networks, funding portals, syndicates, and more. Connect with him about fundraising, business growth, and emerging technologies

    Read More »

    TEN Capital Network- Funding as a Service (FaaS)

    As the business world moves to a service economy, everything becomes a service – even fundraising. Traditionally, those who start a business must raise their own funding. At later stages of the company, service firms provide investor relations programs but the cost is high and their services are targeted at investors in publicly traded stocks for the most part. The startup CEO, more than anyone needs support in finding investors, introducing the deal, and keeping the investor up to date with the progress. Closing the round is yet another challenge in chasing investors for signatures and checks. Brokers are often used at the Series B stage and later but rarely at the Seed and Series A stage as investors expect the startup CEO to lead the raise rather than outsource it entirely. TEN Capital innovates by providing “Funding as a Service” to early stage companies. We help the CEO raise funding by sourcing investors, making introductions, tracking interest, and following up with updates and investor documents. More specifically, TEN Capital provides: Warm introductions to investors Consistent update campaign to the prospective investors Coaching on terms sheets and due diligence documents Assistance in closing the investment – including chasing the investors for signatures and checks Tools including a data room Online and phone support for the duration of the campaign All for one monthly fee with no long term contract or backend fee. The CEO leads the fundraise but now has support for the difficult parts of the fundraise process – finding investors, making contact, following up, and closing the round. 

    Read More »

    The Fundraising Process- How to Build a Relationship with an Investor

    The key to raising funding from an angel investor is to establish trust and demonstrate competence. In the process you are able to build a relationship. You need to have multiple interactions and an ongoing dialog. The interactions lead to familiarity.  When I led angel networks in the early 2000’s I witnessed many an entrepreneur coming to the group and pitching. About ninety percent of them would go away and we would never hear from them again. We had no idea what happened and we would often wonder what became of their startup. A handful of those startups would come back and give us updates and show progress. Typically over a three to four month period. The investors had enough information to make a decision and they were the ones who raised most of the funding from the group. Those entrepreneurs were the ones who spent enough time to demonstrate their competence and establish a level of trust. Investors are always looking to learn more about the industry and how to invest. One idea is to share information that helps them in that direction. Bring new information back from a trade show to share with your investor contacts and offer news about the industry that is not readily known to the investors. You’ll find it easier to gain coffees if you’re bringing new information to the investor. Hall T. Martin is the founder of TEN Capital and a builder of entrepreneur ecosystems by startup funding through angel networks, funding portals, syndicates, and more. Connect with him about fundraising, business growth, and emerging technologies

    Read More »

    Site Map

    Scroll to Top