Raising money can transform the future of a business, but it's also a perilous exercise. Many projects fail not because of a lack of potential, but because entrepreneurs make strategic mistakes in the face of investors. Here are the ones you should definitely avoid.
Fundraising is based above all on solid financial data.
Common mistakes:
An investor expects the rigor and transparency.
Ask for too little, and you may run out of cash quickly. Asking too much and you feel like you're not in control of your growth plan.
The ideal is to justify each euro: recruitment, R&D, marketing, expansion...
Not all investors are created equal.
Classic mistakes:
An investor should be a long term partner, not just a funder.
A good project can fail because of a poorly prepared pitch.
Common pitfalls:
An investor must understand your project in a few minutes and perceive your determination.
Fundraising is not the only solution. Many entrepreneurs close themselves too quickly to other options: bank loans, leasing, grants, grants, crowdfunding, ICO... Showing that you have explored several options reinforces your credibility.
Fundraising is a demanding exercise that requires preparation, lucidity and realism.
Avoiding these mistakes will give you a competitive edge and increase your chances of winning over the right investors.
