Funding idea stage startups
So many times I have been faced with a number of requests from young people seeking to turn their ideas into profitable ventures. The first question they ask me is can you invest in my idea? They quickly show me their business plan and what they need to start their venture, down to funds to register their company with the registrar of companies. I smile at them and see how little has changed to when I first ventured out myself. My smile quickly disappears however and I start to walk them through what they ought to be doing to prepare for an opportune time to raise money.
It really breaks my heart to see so many young people with great ideas that never see the light of day because let's face it there are not receiving the right information on what they should be doing to get ahead. It is not just about getting funding an idea. There is much more that needs to happen before the funding question. A lot needs to be unlearnt and learnt by startup founders there. Without knowledge resources are wasted on poorly executed ideas as many young people will pursue what they think is the right way of starting and running a business. I know this because I made similar mistakes in the past. Little has changed since then.
If I was to go back in time with what I know now about how to start and grow my startup I would do much better and know that raising funds or finding an investor should be the least of my worries in the early days of my startup. The power of hindsight! Right. Why must you make the same mistakes I and others made when we started out. The biggest mistake we make is not wanting to learn and thinking that there is the right way or only one way of doing things! In-fact there is a dangerous assumption that is made by first time startup founders which ultimately leads to failure or idea death. It is that to start a business you need all the bells and whistles to be in place to succeed. This is far from the truth.
To start a venture that will make it and raise funds from investors you must start by being very clear about why you are pursuing that idea in the first place. Read the book by Simon Sinek “Start with Why”. What do you stand for, what do you believe in and what problem are you solving? Great startups start by answering the question Why? Many founders spend a lot of money and resources before they answer this important question. Never start a business without knowing your Why? You may very well be wasting your time and resources. Very few founders have a crystal clear idea of where they want to end up. The first thing that you must do is to have a clear vision and direct all your attention to realise your dream.
Few people realise that there is no need to reinvent the wheel. So much has been done already that can be applied to solving problems or creating a great business. This is not always clear to those who are starting out. How do you for instance start a venture? Without doing research you will never know the best way of getting this done right the first time out. Ideas are built and evolve through testing. This is why when you start out you should never make the mistake of investing all you have into that first idea. You learn about the customer and what they really want from you as you go. This is one of the biggest lessons I have learnt as a startup founder.
- Posted on 10 May, 2020
- by Administrator