Why Brokers Are Not a Fit for Startup Fundraising

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Fundraising is a time-consuming challenge for founders.

Some consider outsourcing the fundraising process to brokers who will take a success fee for what they raise.

This works well in later-stage funding but is not a fit for startup fundraising.

Portions of the fundraising process can be outsourced, such as the following:

Outbound marketing to prospective investors to generate initial interest.

Investment document preparation, including the pitch deck and financial forecasts.

Advisory work on how to raise funding.

But the actual fundraise needs to be done by the CEO.

The investor will lean heavily on the qualities of the CEO in making an investment.

The founder must build a relationship with the investor to achieve funding.

Brokers try to gloss over the relationship aspect of the fundraise.

For later-stage rounds where there's ample financial data to show traction and product market fit, a broker can be effective.

For the early stage, building a relationship with the CEO is a must.

The broker is not a fit.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let's go startup something today.

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For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

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Challenges in Running a Startup

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Running a startup brings many challenges.

Here's a list of key challenges to overcome:

The startup is a rollercoaster ride from the highs to the lows.

Be prepared to have your emotions go through turmoil.

The founder must move everything.

There's no corporate flywheel behind you.

There's no brand that attracts customers.

Every single customer must be won with hand-to-hand sales combat by the founder.

Sales is filled with many no's and a smattering of yes's here and there.

Hiring people is a challenge.

There's an infinite number of prospective employees and contractors, but only a few that fit.

It's a full-time and a half job.

The hours are long and intense.

The founder must build the culture from the start and carry it through to all new hires.

Building culture takes time, as nothing is won quickly.

Investors should take this into account when considering funding the startup.

Going from nothing to something is one of the biggest challenges in the business world.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let's go startup something today.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

Check out our other podcasts here: https://investorconnect.org/
For Investors check out: https://tencapital.group/investor-landing/
For Startups check out: https://tencapital.group/company-landing/
For eGuides check out: https://tencapital.group/education/
For upcoming Events, check out https://tencapital.group/events/

For Feedback please contact info@tencapital.group

Please follow, share, and leave a review.

Music courtesy of Bensound.

Key Risks in a Startup

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Investors reviewing a startup for a potential investment know there are many risks to consider.

Here's a list of key risks to look for in a startup:

Team risk.

Does the startup have the right team with the right skills, and can they work together?

Market risk.

Will the market provide enough opportunities for the startup to succeed?

Competition risk.

Will the competition outrun the startup?

Timing risk.

Is now the right time to launch this startup?

Funding risk.

Will the startup be able to raise enough funding to accomplish the milestones?

Marketing risk.

Will the startup be able to get its message across?

Sales risk.

Will the startup choose the appropriate sales channels and hit the forecast?

Technology risk.

Will the technology landscape move against the startup and obsolete their technology?

Product risk.

Can the team build the proposed product?

Hiring risk.

Can the team hire the right people based on their location and position in the market?

Consider these risks in making a startup investment decision.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let's go startup something today.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

Check out our other podcasts here: https://investorconnect.org/
For Investors check out: https://tencapital.group/investor-landing/
For Startups check out: https://tencapital.group/company-landing/
For eGuides check out: https://tencapital.group/education/
For upcoming Events, check out https://tencapital.group/events/

For Feedback please contact info@tencapital.group

Please follow, share, and leave a review.

Music courtesy of Bensound.