So you have great idea. You have finalized product or service. One question is how my startup can get venture capital?
VC funding can surely take your business to next level. But venture capitalist take lot of risk and in exchange for same they gain significant control on company’s decision. So before you start plunging into VC funding, make sure that this is the right next path.
So if you have decided to go for VC funding, read on to learn ingredients which can help you attract venture capitalist.
Key Ingredient #1 : Your Startup Idea is difficult to replicate
Venture Capitalists are always looking for unique ideas, that can’t be replicated.What makes it unique and better than that of your competitors?
When Dropbox launched, it was one of the early cloud consumer storage solutions. From its beginning, it was simple to use and available on multiple platforms.
Key Ingredient #2 : Your Startup Idea is patented
Anyone can sell online but venture capitalists look for products that have yet to be developed. They are looking for propriety technology or Intellectual Property which you have rights on and nobody else can use it. But this doesn’t mean it has to be high tech battery or mission to mars but can be simple product of great utility.
Key Ingredient #3 : Your Startup Idea solves problem of atleast million people
Venture Capitalists always look for the size of market. Niche product might be difficult to invest. VC always gauge for how large market opportunity is ?
Key Ingredient #4 : Your Customers are ready to pay money you are asking them too
If your startup is not solving pain of target customer , they will not pay money for it. So venture capitalists look for traction of the product or service.”The greater the number and the quality of early customers displays the startup has the ability to grow past the initial interest from early adopters.”
Key Ingredient #5 : How much target market need to be educated about your product or service?
Is target market ready to adopt the market? If too much education or awareness is required to educate customer, VC generally thinks that it is too much work and might not invest.
Key Ingredient #6 : Is your Startup have some proven sales?
Have you validated your idea? How many customers you currently have? How much hustle have you done to sell your product or service?
Key Ingredient #7 : Are you real entrepreneur?
Venture Capitalists love to work with hustlers.
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