Entrepreneurs need to pay attention to a few things

A few things that entrepreneurs should know about the public

We are now browsing the internet every day, we will see a new enterprise in the public-funded sites to complete the financing targets. With so many successful experiences stimulated, many entrepreneurs are beginning to think that Kickstarter and other websites can help them to obtain valuable funds more easily, as long as there is a good idea, you can start a business trip on the public-funded website. But the reality is that this kind of financing is not as simple as you think. When you see many entrepreneurs in the public to get the funds on the site, in fact, there are more enterprises did not successfully complete the financing goals, but the media do not report these enterprises.

Sang Lee, founder and CEO of Change company, said: "Now many people who are just starting to start a business think that public financing is a way to make it easy for them to get money to start a business." However, in fact, the public need entrepreneurs to do more homework, and entrepreneurs have a strong support network to successfully complete the target. The old saying goes, ' There's no such thing as a free lunch '. ”

Whether you want to get a small sum of money through a product purchase or a large sum of money through a transfer of equity, you will encounter many unexpected and sudden challenges in preparing the project. To help you deal with these challenges better, four executives from all over the platform share their experiences with us, hoping to help entrepreneurs improve their chances of accomplishing their goals.

Choose a platform carefully

While all the platform's goals are the same-helping entrepreneurs find large numbers of donors or investors on the web and get the money they need from their founders-but not all platforms are the same, each platform has its own characteristics, and you need to choose carefully. If you just need a small amount of money, you can choose Kickstarter or Indiegogo. But if you need millions of dollars in investment, then some equity transfer platform will be more suitable for you. If you are more interested in the latter, there is a very important thing you need to keep in mind, that is, before the start of the public-funded projects on as many platforms as possible to research and compare to find the best to meet your needs.

Optimize Capital CMC CEO Matthew McGrath said: "In the traditional investment market, for entrepreneurs, the biggest challenge is to find a willing to invest in their own venture capitalists." And on the platform, there are a large number of investors willing to invest in you, they are also actively looking for the start-up companies they are interested in. And for the entrepreneur, what to do is to find the most suitable for their investors. ”

It is recommended that entrepreneurs conduct detailed research and investigation into the size of the market, the types of active investors, and the investment preferences of investors on specific platforms. After the investigation, you will be able to make relatively rational and accurate judgments, choose the most suitable for their own platform. He pointed out that the choice of the wrong platform for entrepreneurs may bring them time, money and even corporate valuation losses.

Make reasonable plans for financing scale and duration of the project

Many entrepreneurs, especially those who have just come into contact with the concept of fundraising, will think they can get all the money they need on the platform and get some extra money before the deadline. But it is important that entrepreneurs have to be rational at all times in setting the goals and duration of the project.

Launch Angels CEO and fund manager Shereen Shermak said: "For entrepreneurs, in the public financing, a big challenge is when to start financing, and determine how much money they want to get through the public-funded sites." Also, entrepreneurs are often not sure how they should accurately develop the duration of a project. ”

Shermak says entrepreneurs should first think carefully about how much money you need to develop into the next stage. This is the first thing you need to focus on before you make a public project.

Shermak added: "Entrepreneurs always think that the public-funded websites can replace the traditional financing procedures, that through the public-funded sites will be able to get the necessary funds." But this is not the case, in the online financing, entrepreneurs should also be good at the same time through the traditional financing channels to get funding. This will improve the start-up's financing success rate. ”

To arouse investors ' interest in your investment

You have a great idea, and your friends and family think you have a great idea. Does that mean someone will donate your project? You still need to do a lot of preparation before you start a project that will help you get more people interested in your project and keep them interested.

"Before you start a project, you should first hook up investors ' interest in your investment, which is critical," said Lee on the change company. This work needs to be done not only at the time of the project but also before the project begins. This work allows you to get the most investment in the shortest amount of time, with limited time and manpower. ”

While a lot of people say they're interested in your project, it doesn't mean they're going to invest in your project, and even if someone tells you they're going to invest in your project, chances are they'll change their minds temporarily. In the absence of special needs, it is difficult for people to take their money out for others, especially for the non professional investors. So you have to cultivate their interest and willingness to invest. You have to personally contact your network, ask them to invest in your project, and get rid of spreading it for you.

Find a donor

Everyone knows the fact that no matter what kind of business they invest in, they face risks. So all investors want to know exactly how much risk they will face if they give you a lot of money.

"Entrepreneurs often need to face the challenge of financing, and that is that some angel investors, even small VCs, will tell entrepreneurs they are interested in your business and are willing to invest," says Ryan Feit, co-founder and CEO of SeedInvest. But the entrepreneur has to find a bigger investor to be the recipient before they can vote. I refer to this as the ' lead game ', which is like a chicken-born egg and a chicken egg. ”

Many of the investors who have just entered the investment industry do so, and they just want to be behind other famous investors. This has led many entrepreneurs to find themselves getting a lot of "commitment investing", but there is no real money in their accounts. Entrepreneurs also encounter this problem when they raise money for equity.

In fact, you will also face the same problem when you Kickstarter microfinance. If VW investors find that a project has no one or few people to invest in, they will start to hesitate. How are you going to encourage them to invest in you? This is the time to play the importance of building an investment interest.

Even if you don't have any plans now, you should start to understand the industry, Lee said. "The public is the main way to raise money in the future, and all founders should be aware of it," he said.