The greatest mystery about pitching investors seems to be what investors are looking for in a startup. There's no mystery to it; the thing investors care about most is traction. Traction means that people like your product, your business model is working, and you have a high probability of future success. Product-market fit is the prize that every startup is pursuing; traction is the best measure of your progress.
That's why the first thing you need before you pitch investors' traction. This doesn't mean that you can never get investment without traction; it just means the very best way to get VC investment or angel investment is to demonstrate traction.
Traction is shown through profits, revenue, customers, free users, and proof of customer need/problem. The best way to get investment is to start building your product and testing it in your target market before you begin fundraising.
Investors love to invest in companies that don't need them. If you have a lot of traction in a large market, you shouldn't have any problem raising money. Traction makes up for a lot of deficiencies in your team and product. The more you need investor money, the harder it will be to get.
Traction isn't free, but it can be cheaper than you think. 77% of small businesses get started using the founder's savings, and a third of all small businesses get started with less than $5000.
Raising investment has become a badge of honor in the startup world. But having extra money on hand early on is not always beneficial for a startup. While early-stage investment seems like it would help you be more successful, it's not a predictor of success. In fact, 60% of companies that raise pre-seed money don't make it to the next round of funding.
The greatest mystery about pitching investors seems to be what investors are looking for in a startup. There's no mystery to it; the thing investors care about most is traction. Traction means that people like your product, your business model is working, and you have a high probability of future success. Product-market fit is the prize that every startup is pursuing; traction is the best measure of your progress.
That's why the first thing you need before you pitch investors' traction. This doesn't mean that you can never get investment without traction; it just means the very best way to get VC investment or angel investment is to demonstrate traction.
Traction is shown through profits, revenue, customers, free users, and proof of customer need/problem. The best way to get investment is to start building your product and testing it in your target market before you begin fundraising.
Investors love to invest in companies that don't need them. If you have a lot of traction in a large market, you shouldn't have any problem raising money. Traction makes up for a lot of deficiencies in your team and product. The more you need investor money, the harder it will be to get.
Traction isn't free, but it can be cheaper than you think. 77% of small businesses get started using the founder's savings, and a third of all small businesses get started with less than $5000.
Raising investment has become a badge of honor in the startup world. But having extra money on hand early on is not always beneficial for a startup. While early-stage investment seems like it would help you be more successful, it's not a predictor of success. In fact, 60% of companies that raise pre-seed money don't make it to the next round of funding.