It is correctly said by Tony Hsieh, Zappos CEO that “Chase the vision, not the money; the money will end up following you.” Being a Startup, one can only hope that the money will follow and the question of managing day to day expenses remains a challenge. An entrepreneur may use his own savings or ask friends, families who may get attracted to the idea and commitment. However, to give wings to an idea or vision, money is crucial.
You may have noticed that not every startup can raise funds or attract investors; the reason is simple that a startup usually doesn’t understand all that is involved in doing a business, be it a business plan or creating a marketing strategy or even the day to day compliance requirements. The current market analysis has also showed that many startups are not able to attract millions of investors or venture capitalist. But don’t lose heart, here are 10 tips for you on creating a right impression on investors and show seriousness of your startup. Investors, basically, want to see the real idea and an innovative one which I think you have.
1. Reach proof of concept stage first
Startups should demonstrate that a product/idea is financially viable. It definitely involves extensive research and review, examination of the revenue model and indicates development cost, long-term finance projections and how much the service costs to maintain and market. It’s an excellent way for a business to evaluate itself internally and at proposed acquisitions and projects.
2. Create a business model/plan
Before you start a business, you must develop a business plan. It will be implemented by the company to generate revenue from its operations. It should explain what issue your startup chooses to resolve, why your solution works better than competing ones and how company can drive between what customers are willing to pay and the costs.
3. Marketing collaterals are a plus if you are able to use them without burning a hole in your pocket
Marketing collaterals are considered as the collection of media used to support the sales of a product or service. See, if you can use these for your startup provided that it will be cost-effective.
4. Secure your idea and Intellectual Property
In this competitive world, everyone is beating each other and looks for ways to win. To avoid such issues, it is important to get your patent or design registered with the Government of India as soon as you can.
You may visit: http://startupindia.gov.in/
5. Get the right set of people
Starting up something with right set of people, will definitely an addition to your success. It is essential to hire right set of people who are like minded and help in achieving the goal. Nevertheless, it is important to know the way of retaining them in the organization.
6. Go outside and meet people
When you meet different people and share thoughts, you will get an idea of many things which you might have not considered before. It is always good to discuss thoughts and future plans; you never know when you get something new and essential for your own startup.
7. Get your structure and compliances right
Hire a Chartered Accountant or a Company Secretary and get the company incorporated as this need to be done before raising any funds from outside. You may incorporate a Private Limited Company or a Limited Liability Partnership or Partnership firms as these all are eligible for exemptions under the “Startup Indian, Standup India Plan”.
8. Don’t just go for any money offer, choose wisely
It is advisable to choose investors wisely, you may sometimes deal with “fake investors” who listen to your idea and can use that idea for their own benefit and work on it. Don’t worry, you will get funds the market has many investors.
9. Use the old age concept of money management
Money management is essential for any startup. I would suggest making use of old age concept of money management like keeps some amount in a separate account as this will help you to deal with any financial crisis.
10. Keep updating and upgrading
If you follow and keep evaluating your performance with the one you have planned, it will help you to avoid any major issues at a later stage. You will get a chance to look for alternative solutions in time and help you to grow your business in a desired way.