Raising money for your startup(The Hard Way)

I needed 5 mn dollars to get started. In 2009, start-up capital was limited in
India & few VC firms only invested in growth-stage companies vs true blue
start-ups. It took me 18-20 months to raise my first start-up capital.

Back in 2009-10 unlike a conventional tech sector like e-commerce which garnered
a lot of VCā€™s attention, setting up an entire B2C branded business like Milk
Mantra was tough as it involved manufacturing + deep supply chain.

My learnings from my experience

1. Raising money in an impact sector vs tech is tough:

Plunge into the sector only if you have the expertise in it. Approach impact
sector investors first. They know the space well.

2. Be ready for the long haul:

Your idea should have translated into a small yet scalable model before you
raise money. Investors bet on impact + scale & not ideas alone. Anticipate the
challenges before you raise money. If you under raise, you will shoot yourself
in the foot.

3. Raise as you scale:

Don't just scale to raise but raise to scale. If your business model can sustain
via bootstrapping or on a bare minimum capital, opt for it. Keep overheads low.
Overcapitalised startups run the risk of trying to justify to their investors
all the time.

#startup



Posted by Srikumar Misra on LinkedIn
link: linkedin.com/in/srikumarmisra