Now that you have your startup idea materialising, you can proudly refer to yourself as a founder (or co-founder). As exciting as running your own business is, it’s no walk in the park. Going forward, you’re going to be plugged in with the latest technology, hiring the best possible team and most importantly – VC funding. Having come so far, you probably know how important it is to be backed by a reliable and reputable investor. Apart from financial backing, the right VC can also add to the value of your brand. As you strive to make your budding business VC –ready, here are 3 things that can make or break your funding dreams.
Unit Metrics of The Business: More than anything, an investor would want to know if your idea genuinely has the potential to grow. Create your business blueprint in such a way as to show the investor how you plan to make your startup break-even first and then profitable in the coming years. Nowadays, venture capitalists want to know when a business will become profitable. If profitability can be predicted, they will want to associate with the company. Apart from that, if your idea makes sense to the investor, they would want to put their money on it. It bodes well for founders to explain their plan in the most coherent way to investors so they can get on board and be excited about it.
Scalability of The Business: If someone is going to invest not only their money but also their reputation in you, it’s obvious they’d want you to sell a product or service that will be widely accepted in your target demographic. If you’ve picked up an idea which is new to the Indian market, an investor will be interested in whether or not the idea will work in India.
For instance, Indians love to save money more than anything else, so the Cashback concept spread here like wildfire. Extrapolating from the same need to invest in a potentially profitable business, VCs will also consider the ROI that the investment will give them. If a good equity plan is provided to them, they would like to give their time and money to the startup.
The Startup Team: Yes, the team you hire not only matters to the growth of your business, but also your investment prospects. A venture capitalist would like to get a sense of how passionate and strong your team of employees is. It is the team, after all, which is the foundation of your startup from where you will get fresh ideas, honest inputs, relentless hard work and shared passion for your startup idea. Quality talent with ample experience and respect for the company, will definitely get the nod from a venture capitalist.
So, here it is. The three big factors that you need to inculcate into your awesome idea to make it equally as awesome in the eyes of investors. Good luck!
Source: Money Control
