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The Benefits of a Family Office

The Benefits of a Family Office

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Fundraising, Investing

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    10 Reasons an Investor Will Pass on Your Deal

    September 12, 2021

    2 min read  Investors see many deals and can spot glaring holes immediately. Here are ten main reasons an investor will pass on your deal: No Traction. You need to show some evidence of market validation. Even without a sales team and a marketing budget, there should be some demand for your product. No Social Proof. There needs to be some evidence the product works. The Team Doesn’t Fit. If there are major holes in the team or you’ve filled the secondary roles and left the primary ones empty, then it’s going to be a problem. Criteria Don’t Fit. Many funds are clear about what they invest in (SaaS, Healthcare IT, etc). Your deal needs to fit into one or more of those criteria. You Don’t Know Your Market. Those with a vague or fuzzy knowledge of the market or customer will have difficulty raising funding. The ability to site numbers (market size, growth rates, customer spend, etc) helps demonstrate your knowledge. Financial Projections Don’t Add Up. Some startups use the excuse that they can’t predict the future and therefore they have no financial projections. Most investors see this as a lack of knowledge about the business and the market. Fuzzy Business Plan Some plans are filled with future possibilities and great opportunities but fail to define the core product and how it will be built and sold. Investors can spot a lack of focus on the business plan a mile away. No “Use of Funds”. The phrase “I’m raising $1M” often triggers the bull meter because the fundraiser rarely knows how they’ll apply the funds. No Validated Business Model. There’s no evidence of a business either in product or customer activity. Lack of Follow-Up. Surprisingly, an investor will express interest and then never hear from the entrepreneur again. It can take several follow-ups to close an investor. TEN Capital has created a series of calculators to help you see how your startup compares to industry standards. You can discover if you are ready for funding, see how your deal will be seen by investors, learn how to set the price for your next raise or exit, or calculate how much TEN Capital can save you on your fundraising campaign. Feel free to try out our calculators and contact us if you would like to discuss your fundraise: https://staging.startupfundingespresso.com/calculators/ 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

    How to Find Investors From Your Network

    February 6, 2019

    2 min read So you have begun your fundraise, but how to find investors? Start with your personal network. This includes family, friends, coworkers, past coworkers, and those you know through 1 to 2 degrees of separation. For most contacts, this comes to about 15 to 20 accredited investors. Your Network The first place to start is with those in your network so you’ll get initial questions (usually easy ones) that you can start to flesh out your deal and update the investor documents. As you expand the circle from your close friends to acquaintances to friends of friends, you’ll find the questions become increasingly more difficult. This initial phase is helpful in making sure you have the answers to the questions investors will ask. Some entrepreneurs are surprised at how some investors just don’t get it and why don’t they see the great opportunity it is. This is because the entrepreneur looks at the opportunity in the deal while the investor looks at the risk. Be Prepared Although they understand there’s an upside, the questions will revolve around the downside. The key is to have a response for each risk and demonstrate how you have ALREADY solved it and not just promise to solve it. What if you can’t sell the product? “We have already sold it.” What if you can’t recruit the right team members? “We have already recruited most of the team members.” Once your deal fleshed out and you have some funding, you don’t want to take it to non-family and friends and say, “no one in my network would invest, how about you?” That’s what they will hear, no matter what you say, if you don’t have some funding in the deal. Investors for the most part don’t want to be the first and they look for someone else to lead. Read more in the TEN Capital eGuide: https://staging.startupfundingespresso.com/how-to-raise-funding/ 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

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