There are many ways to find funding for a small business or startup, but venture capital still seems more elusive than most. You read about large sums of money getting thrown at a few startups in the news, but do you know how to get there yourself? What do you need to do to best appeal to venture capital and other fundraising avenues?

You will want to make sure your idea and pitch for your business are strong. If you do not stand out from the crowd as something new and different, it will be difficult for funders to want to give your business funding over any others that are similar. With a unique idea or service or something to set you apart from others, you will also have something that helps set you apart from other investments in their minds.

Don’t focus only on your idea, however. The venture capital process┬áis ultimately an investment opportunity for those who have the funds, so they will want as much information as you can give them in order to make an informed decision. All the data you have and other preliminary relationships that you have formed are important here, as well as the latest industry research and statistics about your area of business. Be concrete with your data about what the need is and how your product or service is filling that need in a unique way.

Often, you will be able to get a small amount of the funding you hope to initially raise as a seed to use to prove your concept with more data before further investments can come. The timelines for these rounds of funding can vary based on the industry, but generally the seed round is for between six to 18 months, while you prove your business’s viability. The series A funding, the next round, is substantially more money and will help sustain and expand the business for another year to 18 months. At the end of this time, you should either be in good shape to raise another round of funding or have already started to break even and bring in your own profits.


This article was written by Gillian Kruse for Small Business Pulse


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