Expert interview: 13 questions on Funding & Pitching (part 2)
Andrea Cockerton, founder of Mudhut Consulting, the Cambridge-based venture market consultancy works with entrepreneurs of both start-ups and more established SME's on pitching for business critical investment or deals. For The NextWomen she answers questions on funding & pitching. This is part 2.
Is it true that you can better ask for more than you need than exactly the amount or less?
In my view you need to ask for the right amount of money for what you realistically - with ambition - believe your business can achieve and needs to do so. However, you need to be canny about the fact that market forces, economic trends, competition and so on and so forth can all impact on your targets. An investor needs to see that you are not blinkered and are considering all these things - that you are focussed but flexible. Having said all that, often companies do seem to underestimate exactly how much
money they will need...
Is there a rule for what an angel investor seeks as shareholding?
Not to my knowledge, but of course they are likely to want as much as they can get! Generally companies want to give away less, and investors want more than is on the table. Beware - if you have a ludicrous valuation, investors could well walk away without even discussing it. Be sensible and
get practical advice. There are many different ways how an investor valuates a business.
Is money more or less important than expertise?
They each have their value, and at times exceed each other in importance. But you can do without neither.
How many times should you pitch before you are successful?
Pitching is both a science and an art, and so many factors will impact on whether you are successful or not, for example - is your business actually ready to take on investment, is the management team in good shape, economic factors, how much of the investment fund is left, whether you get on with
the fund managers and so on. Some individuals are lucky and all the factors are in place within a few pitches, some less so. If you really are suitable for investment, and honest advisors and industry experts feel the same, keep going.
What is the most popular feedback that entrepreneurs receive from finance people?
Your valuation is ridiculous / come back when you have your first client!
What is the best way to get in touch with financial people? just by mailing their websites? via contacts etc.
Personal contact has been proven to be the most successful way in to VCs, so use your network as much as you can.
Do you have any names entrepreneurs should know in raising finance?
Have a look at the British Business Angel Association for angel networks, or consider buying the VC pro database, which has a full list of global VC investors.
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