When it comes to raising money, startups and small innovative businesses have never had it so good in Australia - and indeed globally!
The banks may not be lending - but cash is abundant if you know where to look , and how to present your opportunity - private equity firms VCs and Angel Investors are flush - with major successes - I can think of 20 Unicorns in Oz - Afterpay, Zip, Redbubble, Canva, Aconnex, MYOB, Xero , GO1 , Appen , Atlassian and so many others that come to mind!
Notoriously secret in their dealings, angel investors and VCs are wealthy individuals who invest in start-ups with big potential.
Right now - they are flush and bullish says Angel Investor and Tech Entrepreneur - Douglas Chrystal - - banks are not giving great returns and they are ready to invest.
Like venture capitalists, angel investors are after the 10X home run. They know they need to invest in 10 to get the 1!
I will never forget Tim Draper (arguably the worlds most successful VC) saying that hos biggest mistake - was not investing when the entrepreneur pitched him (Mark Zuckerberg)
So what does an Angel Investor / VC want ?
They want to know how they will get there money back and then some - and the time frame
They want to know how they can add value
So - how do you find these investors?
How do you present to them?
What are they looking for?
Speaking to Mick Lynch of BSI Innovation - who specialise in accessing Government Grants and money for immovative companies and has been in this game forever - says -
It’s about the IP and most importantly the people - people back people .
How does your startup be investor ready- what do they need?
Do you have an advisory board that is connected and can bring you deal flow?
Is your valuation realistic ?
According to Angel investor Dominic Carosa, who has invested in or acquired countless tech based and is now running Banxa - in the crypto exchange space says that it’s important to find the right investors who will continue to back you as you grow- valuations are not so important for the right partners!
What are the terms and language that a startup needs to know ?
Terms that startups need to be familiar with are FFF (fools family abd friends) convertible notes , ratchet clauses , pressed , seed, series A, B,C
Here’s a great article of 20 terms tou need to know
So where to from here?
The key is to have as many coffee meetings and zoom meetings as it takes to raise the money - and once you are oysgezoomt (sick of Zoom) - swallow hard and continue - and when you are sick of coffee, drink sparkling water!!
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