Raising your next round of funding is not a given. Each round of funding presents its own set of challenges.
In today's short video, I'll share with you my tips for raising your next round of funding. Make sure to watch all the way till the end for my last tip; It was the difference maker for us, and it might be for you too.
Read The Video Transcript Below:
So let's say you've already raised a round of funding, and now you're going after that next round of funding,. What's going to be the biggest challenge you're going to face when you raise that next round of funding?
Well, I can't guess at exactly all the challenges and the problems that your business has. I certainly hope you didn't have the challenges that my company had when we were fighting against one of our investors, but let's assume that's not the problem for you.
Let's assume instead that you have a normal company with reasonably supportive investors and you're going for that next round of funding. What's the biggest challenge? It's going to be showing that you've made enough progress to justify the increase in valuation that you want so that you can get that next round of funding.
That's going to be the biggest challenge you face. Now, there are some tips that I can give you to give yourself the best chance of making this happen.
Well, the first is obvious. You got to execute. So focus on executing to your plan, making progress, showing enough growth in terms of it's customer growth that you need to have, showing that. If it's execution growth that you need to have, show that. Whatever it is that you told people you were going to do when you got the a round or what, whatever round it is that you're in to get to that next round, that's what you're going to need to do is show people that there's been enough progress made.
Okay, so that's thing one. Thing two, which is maybe a little bit of a subtle tip, is how do you increase the time period that you need to raise your funding? So in other words, let's say you haven't made enough progress, and your worried that maybe it's going to be difficult to justify that next round of funding.
What do you do? Well, one thing you can do is what we did because I didn't feel we had made enough progress. So what do we do? We've got a loan.
That extended our runway and gave us enough time to keep showing that our rate of adoption of customers was growing and our business was growing, and that allowed us to secure our next round of funding. What will it be for you?
I'm not sure, but focus on execution. Focus on extending your runway, which can be through loans. It can be through, sadly, to say layoffs. Whatever it is that you need to do to get to that next level. That's what you're going to need to do, but you're going to need to show progress. That's the key. I'm Brett at www.brettjfox.com. Have a great, great day.