Startup Funding
Raising capital for a startup is one of the most critical steps you’ll take as a business-owner. Without sufficient funds, it’s nearly impossible to bring your idea to fruition. A startup’s success hinges on its ability to secure capital, and for founders outside of the US, this can be a daunting task. Here, we share our story about raising capital for our startup outside of the United States.
Researching Financing Options
The first step when considering how to fund your startup is to research the available financing options. Depending on your goal and where you are located, you may choose from a variety of sources to secure capital.
Angel Investors: Angel investors are usually wealthy individuals willing to invest in startups in exchange for a stake in their company. Angel investors range from family and friends to venture capital firms and individuals with a specific interest in particular industries.
Venture Capital Firms: Venture capital (VC) firms invest in startups in exchange for ownership of the company. VCs have a long history of investing in tech startups, and many startups have raised capital this way in order to quickly scale-up their businesses.
Crowdfunding: Crowdfunding has become increasingly popular in recent years, as it allows entrepreneurs to raise funds through online platforms such as Kickstarter and GoFundMe. These platforms provide entrepreneurs with the opportunity to reach a wide audience when seeking capital.
Government Grants: In many countries, there are government programs that offer grants to startup founders. These grants can provide much needed funds to help entrepreneurs bring their idea to life.
Our Experience Raising Capital outside of the US
When we decided to start our company, we recognized the importance of acquiring sufficient funds for our endeavor. As we were based outside of the US, we assumed it would be challenging to find an investor to trust us and invest in our company.
After thoroughly researching the available financing options, we decided to target angel investors and venture capital firms in Western Europe. We chose angel investors first and began building relationships with VCs who invest in tech startups.
Initially, we found the process daunting. We naturally had some trepidation when approaching potential investors. We overcame our fear and took the plunge, sending out emails to hundreds of potential investors.
Our Gambit Ultimately Paid Off
We put in countless hours of work, but all of the hard work and effort paid off. We eventually got our first two investors onboard. This was a huge victory for our team and provided us with the springboard to start our company.
After securing our initial capital, we were able to start building our product and begin our journey. Since then, we’ve gone on to secure additional investments from venture capital firms and even government grants.
Tips for Raising Capital Outside the US
Having been through the process of raising capital outside of the US, here are a few tips that may help other entrepreneurs in the same situation:
Research Your Options: Before you begin the process of seeking funds, make sure you do your due diligence and research the available options to find the best fit for your company.
Build Relationships: It’s important to have faith in yourself, and to be able to demonstrate that to potential investors. Make sure you take the time to establish relationships with investors to demonstrate that you are worthy of their trust.
Don’t Give Up: Rejection and failure are a part of life, and the process of raising capital is no exception. As an entrepreneur, you will encounter setbacks but it’s essential to remain resilient and never give up on your vision.
Raising capital for startups outside of the US is no easy feat. However, as our story shows, it is possible to successfully do so. Just remember to research your options, build relationships with potential investors, and never give up. With sufficient effort, you can raise the capital you need to bring your startup to life. Good luck!
