Five tips to funding a startup
John Hickenlooper, now Colorado's governor, knows what funding has to do with it -- the success of a business, that is. As a Denver entrepreneur working with other urban pioneers to launch Colorado’s first brewpub and Denver's first craft brewery 25 years ago, Wynkoop Brewery Company, it was not easy. At the recent Colorado Capital Conference in Denver, Hickenlooper shared, “It look two years and over 200 meetings to raise $400,000. Those who did invest received a 90 percent return per year for 12.5 years when we sold out. Entrepreneurs, if you have been turned down over and over, don’t quit! It takes persistence.”
It still is not easy for Colorado entrepreneurs to secure funding, but RVC or Rockies Venture Club, which has been hosting the Colorado Capital Conference (CCC) for 24 years, makes it easier. RVC also runs monthly meetings bringing the entrepreneurial community together, providing education seminars, and having more companies present.
Peter Adams, Executive Director of the RVC, says, “Of the 14 companies pitching at CCC this year, eight have been identified by angels for continued due diligence, ultimately leading to investment in some of the companies. This process has led to more than 20 RVC-pitching companies receiving more than $10 million so far in 2012 with even more investment expected within the next few months in the CCC presenting companies. RVC Angels meet in Boulder, the Tech Center, and now Golden every month to collaborate on investments and create a community that makes angel investing both fun and effective by sharing the knowledge of a diverse group of investors.”
There are many entrepreneurial organizations popping up in Colorado, and now it's imperative that the community work together to minimize overlaps between organizations and to address the service gaps that remain. At a roundtable lunch held at the CCC, some initiatives were established including:
creation of a common calendar so events do not conflict with one another
angel groups agreed to work together to syndicate deals so that combined resources can better meet the capital needs of entrepreneurs. Deep dives are scheduled so that each angel group can share their best deals with peers in other cities.
Five Tips for Entrepreneurs:
1. Be Persistent. Don’t quit. Be creative and try other alternative funding channels such as friends and family, angels and angel groups, venture capitalists, incubators such as ‘Plug and Play Tech Center” as part of the Innovation Pavilion and Story Stock Exchange a crowd-funding incubator, and many more.
2. Join a Mastermind Group and learn from others. The RVC sponsors a group or organize your own group of non-competing entrepreneurs seeking funding.
3. Participate in the Angel Capital Summit. Plan to apply and participate in the March 21-23 2013 event.
4. Get connected. The entrepreneurial business community is taking steps to connect investors to entrepreneurs. Get involved—for example, consider participating in Rockies Venture Club, Silicon Flatiron Center, Meet Up groups such as Denver Founders Network, TiE Rockies, and many other groups.
5. Bootstrap. Raise cash through sales. Keep your financials as lean as possible.
Funding is a critical resource to the success of a venture. Smile, believe, have fun with it, and be open to pivots that make your venture more attractive to investors.