A Guide to Raising Capital Part 3 – Creating Momentum
Raising capital is something that we live and breathe at Wholesale Investor — our business centres around the fundamental concept of generating momentum and getting investors eyes on opportunities. I have raised capital twice, but much of my experience comes in the form of witnessing first-hand, the capital raising journeys of the companies on our platform.
In part III of my ‘Guide to Raising Capital’, I have decided to focus on the concept of momentum, how to create it and why it’s not only important but vital.I have created an equation that for me, acts as the essential starting blocks that will establish the right momentum for your company when it comes to sparking investor interest. The equation is simple in theory, but tricky to master and when you do master it, that is when momentum comes.
It looks like this: 1 + 2 = 3, simple right… wrong! Below I’ve outlined what each number signifies.
1. The concept that nothing appeals more to investors than being able to invest in a ‘hot’ deal or company in a ‘hot’ sector. Just like in the fashion world, investors keep up-to-date with the trend and the trick is to know where that trend is live and when. For example, Fintech right now in Australia is ‘hot’.
2. The key components of business. This essentially means that momentum can be attained by your company having the right idea or mission, team, business model and to some extent, existing funding, for companies not engaging in seed funding.
3. Timing. It is all about timing. However, even if the time is right, you will not gain momentum unless part 1 and 2 of the equation are complete and combined.
4. I know what you are thinking, “he only has 1 + 2 = 3”, well, the reality is that nothing is ever as simpleas 1 + 2 = 3. Number 4 is your backup plan. What happens if your sector is not hot? What happens if your business lacks funding, or you lose an integral team member? Then, number 4 comes into play. This is your ability to focus on investors and key partners who can derive or gain most value from your business at a time when it is not hot.
In most cases when the sector is not hot, it comes down to luck. If you get ready, stay ready and are always raising, you set yourself up to be as lucky as possible and thereby achieve great results. This is maintaining momentum.
IF YOU’RE RAISING CAPITAL OR LOOKING FOR YOUR NEXT INVESTMENT OPPORTUNITY visit www.wholesaleinvestor.com.au or contact us at firstname.lastname@example.org today.
Look out for Part IV of my guide to raising capital, which will focus on when the capital raising really begins. If you would like to know more about my experience in raising capital, get in touch with me on LinkedIn here, or fill out this form to speak to a WI Capital Raising Consultant and tell us more about your ambitions
to raise capital.
Read part one and part two of this guide. Click here for part four.
A Wholesale Investor insight by Steve Torso, Co-Founder and Managing Director
Wholesale Investor is Australasia’s leading investment platform that connects innovative, emerging companies that are looking to raise capital with our active, engaged and growing ecosystem of over 21,500 high-net-worth investors, fund managers, family offices, PE and VC firms, government bodies and industry participants.