While the startup world is renowned for being hugely exciting, from an investment point of view, startups are risky. That’s because without a financial history or record, a lender has no indication as to whether or not the venture will be a success, thus whether they will get the returns they are seeking.
At Lime Advisory, we have gained a name for ourselves in the startup community, having partnered many new businesses with suitable lenders and investors. This is how we have come to understand what lenders want to see from a startup business proposal/plan and that is traction. But, how can a startup illustrate traction before actually gaining traction?
Below, we provide a few tips all startups seeking seed funding should take note of.
Illustrating that your team has a great track record will be looked on favourably by lenders and investors, suggesting that the startup will be in good hands and have a strong chance of achieving its growth ambitions.
Whether you are a startup bringing a product or new service to market, having a mock-up of what it is that will generate revenue will allow a potential lender to visualise the business in action, deciding whether or not they think the startup has legs.
Any good startup will have conducted intense research, having delved into the market they are looking to operate in and gained some feedback from would-be customers. Whether this is in the form of an online survey or even a focus group discussion, having proof of positive feedback will go a long way in swaying a lender to take a punt on you.
If you already have pre-orders and interest in your business then your potential funder needs to know about it, with such data being proof of concept that will make you seem less risky from a lending point of view.
A robust online marketing plan is the key to any successful venture, with more than 85% of business sales and deals now being conducted online. This is why any sensible lender will want to see that you have considered marketing funnels, have conducted competitor analysis and have a clear plan on how to gain traction through marketing activities. It may be the case that your startup has already gained traction online and already boasts a strong following and engaged user base/audience. Any way in which you can display this will be advantageous during the seed funding application process.
Are you a startup in need of business funding?
Here at Lime Advisory, we work with businesses of all shapes and sizes. From multinational established brands to entrepreneurs at the ‘ideas phase’, our suite of financial services have been designed to support all businesses with all objectives and missions.
That said, we are hugely in demand amongst startups, having helped a large number of startup businesses access the seed funding they need to enter the marketplace with a bang!
Are you a startup in need of business funding? If so, contact our team of advisors today and allow us to discuss the many funding options available.