3 Tips for Raising Venture Capital Funding

With SendHub's recent $2 million seed funding score making headlines, the company's co-founder Garrett Johnson provides three tips for securing venture capital support

Every upstart wants to know how they can raise money for their venture. Johnson offers three tips for catching the attention of VCs and gaining monetary support:

There is strength in numbers. At the seed stage, angel investors focus a great deal on your team. “[Investors] are betting on your ability to execute and succeed against the odds, as most startups will inevitably fail,” explains Johnson.

Have a great product. “A common phrase in the area is ‘code wins arguments,’” says the startup’s co-founder. “Having an amazing product–a truly amazing product–will get you attention. Build something people love, and you’ll become attractive really fast.”

Show your social proof. Demonstrate social proof before approaching investors is critical. Having lots of users is great, but having lots of revenue is even better. “Lean Startup guru, Eric Ries, is one of SendHub’s investors/advisors now, but told us ‘no’ months ago because we didn’t have the ‘social proof,’ says Johnson. “We explained our ideas and assumptions. He simply replied, ‘That’s great, but I don’t believe you. Show me some numbers.’”

– Terrance Gaines

Pages: 1 2
ACROSS THE WEB
  • Pingback: 3 Tips for Raising Venture Capital Funding | BrothaTech

  • Osita Enezuagu

    I am a subscriber to blackenterprise, got my April copy twice, one in early April, and another April copy on the 5th of May. I need my May issue.
    Osita.

  • hervey callahan

    hello I am wrighting because I have been tring to open up a barbeque and pizza restaurant here in chicago, I have a great location good food and a workerable business plan but no money. I need some one to take a chance and finace me please give me a call for all the information and details at 708-515-1307 thank you hope to here from someone soon. herb

    • Jory

      Do you really think anyone is going to call you with your education level? “I am wrighting”? no its “I am writing”. Your going to have to level up if you want to own a business because i guarantee no one is going to call you. I’m only 18 and i know this, i didn’t even read the rest of your paragraph because it probably has more errors.

      • Rhonda

        Jory, before you start to criticize and throw stones, please be mindful of your own misspellings. First, your 2nd sentence, “Your going to have…” should be “You’re going to have…”. Grammer lesson for today…”your” shows possession and “you’re is a contraction of you are”. Secondly, the “i” should be capitalized in your paragraph.

        We can offer help in a nonjudgmental manner which will be more palatable for people to receive.

      • Tbestyet

        fortunately young man the rest of the world is not as judgmental as U R. He can do great if he has what it takes and that does not include grammar. As U get older, try to exercise some tolerance for those less fortunate than yourself. Did U know that the founder of Wendy”s (Uncle Dave) never finished high school. No I am not telling others not to finish school, but rather, Life is not over because t
        one does cot complete school. 

  • Steven Lemon

    Herb;
    Without divulging any proprietary information, could you send us a copy of your business plan outline for review?
    Or give me an address of some kind so that I can send you a preliminary information application.

    Our company is part of an investor network that targets small startups like yours. We are not brokers, we are investors who provide the funding ourselves, so you don’t pay US for our help. I would love to submit your project for inclusion in our next meeting.
    Regards
    Steven Lemon
    Stephen Frazier Group, Inc.

  • Chiazor Arah

    Hello Stephen,

    Is there any way you can send me the information packet as well? I am also in the midst of launching my own startup here in Scottsdale AZ. I am looking for funding opportunities in order to be successful launching my start up. I would appreciate any assistance you can offer me. Thank you in advance.

    Chaz Arah

  • Samantha Tette

    My name is Samantha Tette and I’ve been working on starting my own business, Tett Community Development (TCD) which will be located in Smith’s Station, Alabama. TCD is a company that will provide affordable rental homes in a “community based” atmosphere for low and moderate income families where affordability is not within their reach. I’ve completed my business plan and need some ideas on how/where to find start-up money. Thanking you in advance for any information you can offer.

  • Pingback: An Army of Entrepreneurs: Are You Ready to Enlist? @ Natalie Madeira Cofield