Business fundraising is a process of specific steps to convince investors to invest in your business. And to succeed, you need to pay attention to the actions and how to call for business fundraising to convince investors. Let’s find out how to do it to!
1. What is business fundraising?
Business fundraising is a term commonly used in business investment. This term is an activity where a business or a startup gives specific steps to convince investors to pour capital into their business.
To put it simply, Business fundraising is an activity where you present your business idea and call on investors to support and invest in that business project. It contributes to completing projects or products and their development in the business market.
Capital is a decisive factor in developing a project or product for the market. Therefore, business fundraising can be a matter of great concern to businesses, especially startups.
Businesses and startups can start a business fundraising for domestic and foreign investors (individuals/organizations).
2. How to start a success business fundraising?
2.1 Business fundraising based on website
Nowadays, many online forums are created by companies that allow startups to start a business fundraising from investors. Businesses only need to register for an account and present their project to attract the attention of investors from everywhere. This will help you access capital more quickly instead of looking for outside.
2.2 Business fundraising based on fundraising app
Currently, mobile apps also help you find investors online easily. Applying financial technology in business fundraising helps young people have the opportunity to implement their projects from capital sources of investors.
2.3.Start business fundraising with World Bank funds.
Business fundraising for a start-up is easy for a business with a good credit history or existing. It can be assets for mortgaged to the bank.
3. Things to note when start a success business fundraising?
3.1. Make sure it’s a good and workable idea – tips for business fundaraising
It would be best if you had a good idea, at least it is considered feasible by relatives and friends. In addition, you can find yourself a like-minded and passionate person to work with and share difficulties. Many start-up models are formed to satisfy personal passions so that the original idea may be very wild.
But if there are enough elements of “clement weather, favourable terrain, united people”, that seemingly crazy idea brings unexpected success to the thinker. If you have a unique and different idea, don’t hesitate to share it because someone will surely enjoy it.
3.2 Determine which investor is suitable for your project
It would be best if you determined which investor your project will target. These are investors, including friends or family members, or outside investors such as banks and venture capitalists – who will invest through lending, buying shares or closing fit both ways.
Besides, it would help if you also found out what the investor’s biggest concern is, is it appropriate when they join your project or not. There are four things that investors always appreciate when presenting ideas: Trust, business model understanding, financial confidence, and profitability.
3.3. Value your Startup idea – importance note for business fundraising
It will help if you value your ideas and projects at each stage of development. When an investor wants to invest, you and them know how much money you need and how much capital to invest. You also need to negotiate how many percentages of shares investors hold if the project is listed on the stock exchange after business fundraising.
However, many start-up models in Vietnam have not paid attention to this. Therefore, when investors make an offer, they have difficulty determining the value of the project. They usually only base on one of two parts, the actual cost of the investment and the equity capital of the start-up.
Above is how to start a business fundraising that everyone can refer to. Before succeeding with business fundraising, you also need to have “stepping-stones” with your project, such as Impressing investors and creating potential projects, bringing ideas to reality, and far into the future.
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