Fundraising, an ever-present volcano in the life of an early-stage startup. Do you need to go for fundraising? Why do you need to go for it? What is your aim with it? How does it help with the execution of the vision of the startup? These are some things to take into consideration before you start pushing for acquiring funds. However, in this article, we’ll take a closer look at what to do and what not to do once you have finally raised the funds your startup was in need of.
Even though we want to focus here, more on the part of the plan of action after the fundraising is done, it is imperative we talk about what to do before you have raised funds for your business venture. There’s a specific list of questions you need to be ready with the answers for, in order to determine if you’re funding ready.
- Where do you see your company in 5 years?
- Do you aspire to build a long lasting multi-national?
- Are you just looking to be bought out by a big-name player?
- Is your aim to disrupt any industry?
- Are you building to inspire?
- Can you bootstrap using other sources of income, such as family, relatives, savings, etc?
Why are you even looking to raise funds? Is it only because the market trends tend to project that startups have all raised millions of dollars in capital? Is raising capital the only metric of success? It would not be wise to assume so. Is VC funding the only way to success for your venture? There are so many different ways to fund your startup- are you sure giving up part of the control over your firm is the way to move forward?
The After – Do’s Checklist
Great! You decided you do need funding, went in and delivered a great pitch, floored the investors, and are now a funded startup, BRAVO! But what now? What do you do? Surely, you can’t just rest on your laurels and expect business as usual.
As soon as you are a funded startup, you need to prepare for some sweeping changes across the organization. The growth of the startup will be fast-paced and everything will be swifter, more streamlined, and more process-driven.
So here are a few things you need to do after funding:
- First of all, share the good news with the team, you know, if you haven’t already!
- Get the word out in the market via press/media/social channels, in a way symbolizing your business venture joining the big leagues.
- Be ready to implement a lot of processes for the organization and alert the team of the changes in the operational processes.
- Get ready to hire and hire fast, and efficiently, you will need a lot more manpower to implement the goals set for you.
- Streamline the communication process across the organization and help save time.
- Implement strategies according to a 100x more hectic process.
- Learn to manage your own time even better and also practise to delegate in a much more effective method.
- Have a detailed plan/execution model to allocate the resources, time/money and most importantly, capital, which maximises the output you’re expecting.
The After – Dont’s Checklist
While it is great to be funded and everything seems fresh, there are certain things you need to definitely avoid in order to not be one of those crash-and-burn startups which will make the investors lose their faith in you. Here are some Don’ts after getting VC funded.
Don’t Forget To Thank Your Team And The Investors
Manners, the first thing is to maintain your manners even though you might feel like the king of the world right now! Be humble, thank your team for getting you to a stage from where now, you can implement your vision. Invest some time in personally thanking all Startup Investors on-board. Showing humility will evoke feelings of endearment, helping you gain their vote of confidence.
Don’t Assume that the Board Doesn’t Know How You’re Using The Money
A report indicating how you’re going to utilize the funds presented to you by the board will definitely entrust you with them. It will indicate a positive drive to do good with the money towards the business, as well as, towards the people working for you.
Don’t Keep Internal Secrets From The Team
Since every staff member, no matter which capacity they work in, is affected by the fundraising in one way or another, it serves no purpose to hide information from them. Be transparent, celebrate the success, and have an honest and open discussion about the setbacks. This not only opens the gate for free-flowing conversation but also helps establish integrity for you, personally! A team that communicates well, performs well!
Don’t Rest On Your Laurels
Funding is achieved! Now is no time to rest. There has to be a stretch-goal setting to be implemented. The problem in today’s work environment is that not achieving the goal is seen as a failure. The definition of a goal is something towards which efforts are made in a constant fashion.
Hence, it is imperative to be proactive before, during, and after your fundraising process to ensure a smooth transition for your business venture.