How Do Startups Know if They are Fundable?
To a startup enterprise, raising capital is one of the most important building blocks in business – but also one of the most challenging.
Obviously, startups need capital to grow, to take advantage of opportunities as they come down the pipeline, and to build on the foundation of success that they have been busy laying down.
At the same time, the startup business community is one of the riskiest propositions for those with access to capital to provide to these businesses in the first place. Startups fail at a spectacular rate, and on top of that there is so much competition for this capital and funding that things can get really cutthroat in a hurry – and only the best startups are ever going to see outside investment that can propel them to the kind of success they are shooting for.
If you are building or launching a startup, it is mission critical that you do everything you can to make yourself attractive to outside investment and that you are doing everything possible to build your own cash flow so that you can (inevitably) become self-supporting.
Here is some inside information to help you determine whether or not your startup is “fundable” and what you can do to improve your odds of success moving forward.
How competitive it is your industry?
A super competitive industry is a bit of a double-edged sword for startups today.
On the one hand, and ultra competitive industry means that there is a tremendous amount of money to be made, there are worthwhile problems to solve, and the potential to dominate a market that can skyrocket a business to one of the most important and influential on the planet definitely exists.
The smart phone industry is incredibly competitive, for example, but it is dominated by only a handful of companies that fought it out during the startup phase.
On the other hand, however, with a flood of competition your startup in particular has to be fast-moving, innovative, and exciting enough for startup investors to want to become a part of. If your startup isn’t ticking all of those boxes the odds are pretty good that a competitor will get the capital and funding you were looking for rather than your operation.
You need to define your strengths and focus on them almost entirely
Something that a lot of startup founders struggle with is the concept of defining their strengths, their tangible assets and their competitive advantage, and then focusing exclusively and entirely on those strengths rather than letting them coast while building up weaknesses to compete on all fronts.
Instead, you need to spend as much time as humanly possible building on your strengths so that you become even more impressive at whatever it is your startup best brings to the table. This is what will make your startup attractive to outside funding and investment, and this is how you’re going to be able to attract the kind of capital you need to build your business into something really special.
About the Author
Morris Edwards is a content writer at CompanyRegistrationinSingapore.com.sg, he writes different topics like Importance of a Business Plan for Entrepreneurs, 5 factors to consider before starting a businessand all topics related to Business development, if you are interested setting up company in Singapore contact us or visit our website for more information.