Top Tips For Securing Startup Investment

What are the most important considerations for founders trying to secure startup investment? How should an entrepreneur approach investor relationship building? We spoke to experts on either side of the fence to get their top tips.

In December we wrapped up the second run of Stealth Mode, with a Demo Day featuring dazzling pitches from the program’s participants.

In addition to featuring the cohort’s hard work, the event also included a conversation about the ins and outs of investment with Dr. Sophie Chung, CEO and Founder of Qunomedical, and Bettine Schmitz, Partner at Auxxo Beteiligungen and Director of Portfolio Development at Axel Springer Plug and Play Accelerator.

Here are some top tips for securing startup investment, according to our expert panelists:

Know what model of startup investment is right for you, especially when considering VC money

Our two mentors reminded us that every founder needs to map out the right investment for their startup.

Ask yourself: Do you really need external investment? How big is your market? Do you want or need to scale fast?

Sophie joked that due to the exchange of a large stake, and the fast-growth nature of venture-backed companies, VC money is right for you “if there is no alternative”.

Bettine elaborated that seeking startup investment from a VC is right for you if (and only if) “1) your market is a lot bigger than one billion euros, 2) you want to keep raising money every year and 3) you are willing to give up a significant amount of control over your company.”

In short, explore the many investment avenues out there, and make sure you know what you are getting yourself into before you approach investors.

“If you want money, ask for advice. if you want advice, ask for money.”

According to our panelists, this old adage holds true; the best way to source money is to build connections with investors and cultivate your network.

Bettine reminded the cohort to put their pride aside and push for help when you need it. If the contact doesn’t have any money for you, but believes in your project, then do they have any contacts that they can introduce you to? Don’t be afraid to ask for connections and other kinds of help to edge yourself closer towards closing investment.

Sometimes getting started can be the hardest part, but as Sophie said, you’ve got to start somewhere.

“The best way to source money is to build connections with investors and cultivate your network.”

Fit your approach to the workflow of investors

To spell it out: Focus on a good old fashioned pitch deck.

While a pitch video might be a ‘cool’ way to get your story across, it’s important to consider the workflow and time constraints of an investor.

“You have to respect that your pitch has to fit into people’s workflows. Everyone always wants a deck. It is, however, really cool to send auxiliary videos, but it should be totally optional to look at them. The pitch deck is the most important thing.”

In your investment pitch, be bold and showcase your achievements and expertise

While every pitch should include the market opportunity, the vision and path to get there, don’t forget to show off your background. The founder behind the startup is often as important as the startup itself.

In an inspiring speech, Sophie encouraged the cohort to “brag about your background wherever you can. Sometimes, as women ,we are too humble to brag about what we bring to the table. I can only encourage each of you to do so, because you are all kick ass.”

So, are you the next kick ass founder to join Factory Berlin’s Stealth Mode? Check out our startup mentorship program for female, non-binary and female-identifying founders here.

This article was originally published for Factory Berlin magazine. Read more insightful articles and interviews from our team and community here: https://factoryberlin.com/