top 10 fundraising tips for women 2.0
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Founders and CEOs of early-stage startups are frequently faced with the daunting task of raising venture capital for their companies. Many face that challenge ill-equipped, just as serial entrepreneur Carol Realini had in 1997 when she co-founded her first company. Since then, Carol has successfully raised over 175 million in financing for her companies.Women entrepreneurs can be especially challenged in raising venture capital for their startups because they lack training, role models and sometimes just don’t see themselves being able to succeed. Because of this, Carol coaches Women 2.0 entrepreneurs to tackle this with determination, saying “It is not rocket science, but it is very hard work.” Promoting your company successfully to raise capital is a skill that can be mastered, and unfortunately there is no formal training process for this. Everyone has to learn it. Over the years she has formulated a rubric for raising money, building on lessons learned to create a more efficient and less risky approach. Here are her tips for first-time entrepreneurs seeking capital for their ventures.TRANSCRIPT
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Understand Silicon Valley
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Most VC money is in Silicon Valley Need to understand how things work and happen here There are influencers & networks you need to navigate.
Get advisors
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Many challenges you will need help
Best advisors are experienced entrepreneurs
People with strong Silicon Valley networks
Recruit with your passion and vision
Prepare your plan and presentation
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Preparation for VC meetings is very important
Build your strategy, plan, financials, and presentation
Figure out how much money you need to raise – now and over the life of the company
Practice with friends and advisors
Get a Great Lawyer
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Need a great lawyer to support your company
One that has great network
Strong partner who will get involved with your company
Consider delay or reduce fees until you get funded
Carol’s Law
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10 really successful first meetings with qualified investors 5 investors doing due diligence 3 term sheets 1 close Key is solid pipeline and momentum. Expect fall out
Target specific VCs
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VC’s who do your stage, have money, haven’t invested in competition, good rep, like your category.
Have they invested in a women entrepreneur before?
Warm introductions only
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Not allowed to do cold calling Get advisors or lawyer to make an introduction and
encourage them to meet with you.
Audition with an investor you don’t want
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Force rank your VC targets and do a few low priority investors first
You will learn a lot in the first few meetings – you’ll get better
Investigate the NO’s
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Expect some rejection – part of the process. You need to know why they said no. The real reason. Helps you refine your fundraising efforts. Painful – but do it. Listen to all, take advice from experts
only.
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Final thoughts
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Let your passion come through to potential investors Not everybody will be sold, don’t let that discourage you
or your team. Your job is to find the investors, advisors, and employees that will help make this happen. It is not a popularity contest.
Don’t tell investors know who else you are talking to – if they join together it reduces the count in your pipeline.
You can be successful but be prepared to work very hard. You will need to get your team to step up because your fundraising will take time away from building the business.
Follow me on TWITTER - @carolrealini
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