Securing funding for startups through venture capitalism

 

According to Scott Tominaga of PartnersAdmin LLC, for each startup that gains needed venture capital, most fundraising plans, for one reason or another, fail. Sometimes, it's just pure bad luck, but other times, it can be controlled.

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Scott Tominaga revisits a previous topic for today's blog and shares some steps startup owners can take to earn trust and credibility from potential venture capitalists.

1. Know which venture funding best fits the company's goal.

People have to remember that expert venture capitalists are not interested in linear growth, expecting no less than a return that's several times their initial capital below a span of seven years. Startup owners have to be candid about their business objectives and build their plans around clear-cut tactics to achieve quick growth. That way, they can present these convincingly as most VCs immediately recognize future failure when they see it.

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2. First impressions are as important as anything else.

When facing VCs, startup owners need to introduce themselves properly. Scott Tominaga notes that one of the best and most effective methods of introduction is through the investor's portfolio's founder, as this would have already earned the investor's trust. Startup founders can also opt to be introduced by a client who genuinely believes in the company's product or service and has the credibility to convince VCs that what the company is offering is very much needed by its target market.

Scott Tominaga is the Chief Operating Officer of PartnersAdmin LLC. He has almost two decades of experience in the hedge fund and financial services industry. For more insights on the financial and alternative fund industry, visit this blog.