For an entrepreneur, starting one’s own company is both exciting and of course challenging. Being one’s own boss? Making one’s own schedule? Check and check — all positives. With that said, you’ll also want to be aware of the challenges that lie ahead as you plan to get started.
First, when it comes to potential fundraising for your company, prepare well in advance to meet with investors. Any venture capital firm will want to see solid data showing that your overall and addressable market is substantial—and that you have a first-mover advantage. Show what is different about your product, process, price or niche.
Display that you have done extensive due diligence. It is critical to support your pitch with data-based, industry-relevant metrics, and be sure to include revenue potential. While this may seem incredibly obvious, you would be surprised at how often it is overlooked.
Not all venture capital firms are alike or have the same investment philosophy. Some specialize in one area of investment, like green technology. Others only want startups that sell into Fortune 500 companies. Study them through their websites and the business media to ensure there is a potential good match.
Second, be able to demonstrate that you are not a one-person show, that you are ready with a solid, credentialed management team whose skills complement yours. Team-building is hard work. It’s not just finding the right candidates for certain roles — it’s factoring their cost into the equation and determining how they fit with your culture and other members of your team.
You will need each person on your team to buy into the overall vision. Take every opportunity to bring it up in meetings, in conversation, and in the normal course of your business.
Last, keep your enthusiasm alive and your passion burning. Even after 15 years of advising businesses on what it takes to grow, my day job doesn’t feel like work. I’ve always had a passion for investment and a passion for developing businesses. I truly appreciate the startup culture and creative mindset of entrepreneurs.
Maintaining your enthusiasm may be one of the biggest challenges as you strive for a successful launch and navigate the capital-raising part of building your business. Dealing with the unknown can be daunting. Sales, profits, customers – it all can be volatile and that is one of the hardest parts of being an entrepreneur. Keep in mind your enthusiasm will go a long, long way when meeting with venture capitalists and other investors.