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There are 1731 start-ups in South Africa that are registered on Angel, a site where startups gather. What does that mean for startuppers in SA? It’s pretty tough out there.
Having a great thought starter for a startup is one thing but getting investors to back you is another. Luckily there are also plenty of investors out there who are willing to buck up great ideas. African tech startups smashed funding records in 2018 as 210 startups secured $334.5 million worth of investments, according to Disrupt Africa’s annual African Tech Startup funding report.
Here are a few ways to get people on board to back your startup:
Back yourself first
Napoleon Hill said, “What the mind of man can conceive and believe, the mind of man can achieve.” These words should be a mic drop moment for any startupper. Whether you have a plan to improve public health or an idea for a tech breakthrough, believe that it’s possible and believe in yourself.
When you talk to investors, have a quick pitch ready that summarises your startup idea and why you believe in it. This will be the first step to getting investors on board.
Look out for big investors with big ideas
Before spending too much time searching for covert investors, look for businesses who already have interest to invest in young startups. Companies like Total, for example, have invested into startups through the Startupper of the year challenge by Total. The challenge, that’s extended to 55 countries across the world, aimed to support great ideas that could grow into even greater businesses. The winners from each country received financial support, publicity and coaching to successfully build their startup from the ground up.
Know your crowd
When you approach potential investors, educate yourself in the their investment objectives and remember that they want to see how your business is going to make them money. Make sure you know what type of investor you want. Alejandro Cremades, author of The Art of Start-up Fundraising & Serial Entrepreneur, suggests eight types of investors that you could approach:
1. Friends and family
2. Government and banks
3. Angel investors
4. Angel groups
5. Accelerators and incubators
6. Venture capital firms
7. Family offices
8. Big corporates.
Different sources of capital will be more advantageous and valuable to your startup at different points in time. But the golden string between all these stages will be to keep your network of investors growing and happy.
This post is sponsored by Total produced by BrandStudio24 for Fin24.
