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MetaCX CEO Scott McCorkle discusses the value of launching a SaaS business with company-building experts.
Meet the High Alpha Team
High Alpha Capital invests in both High Alpha Studio companies and outside entrepreneurs building B2B SaaS companies. Our team brings an experienced SaaS operating voice and has built a unique platform to help our portfolio grow and scale.
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Ways to Fundraise
Learning how to raise money for startups is hard. While there are numerous ways to fundraise, it’s not always easy to know which method is right for your needs. Even worse, there’s so much misinformation out there, and it’s difficult to know where your company stands at any given point. Let’s cut through the complexity of fundraising and explain how those working to build their businesses can access venture capital and other sources of funding.
Let’s take a closer look at how to raise capital for a startup and provide some insight into the challenges many companies have. Of course, the easiest way to put money into your business is to find a private investor who loves your idea so much so that they easily provide you with the funding you need. The problem with this is that today’s investors are looking for the diamond in the rough, the business with the profitable business model, and those who are truly passionate about what they are offering. Most people don’t have a private investor readily available to them.
However, you can still get startup funding that’s accessible to you no matter if you are a B2B SaaS startup CEO or operator — or other entrepreneurs looking for support. Here are a few steps to get you started.
Define Your Fundraising Goal
Before you begin to learn how to raise funds, you need to know what you need and why. The more effective you are at communicating this – and the better information you have to clearly define this, the more likely you are to get the startup funding you need.
Expand Your Circle
It’s very common for business owners to lack access to an angel investor – you may not know someone personally who can help you. That’s why you need a more comprehensive reach. Be willing to raise money for a startup online. Be ready to turn to seed funding for startups from a larger group of investors. The more open you are to who can provide you with funding, the more likely you are to find the right professional investor.
Certain industries or types of companies should research investors and influencers in their space. For example, at our venture studio, we invest in B2B SaaS companies, many of which are based in the Midwest.
Understand the Startup Funding Process
To truly learn how to get startup capital, you have to understand the process of raising funding. That sounds simple, but it is a bit more complex than it seems. It’s important to understand your market, what type of investors invest in startups like your own, and what they generally want in return. Explore how to raise funds for business models like your own with our help. You do not have to do this on your own.
If you have an idea or a concept, start working now on learning how to get investment for startup projects like your own. The more aggressive, educated, and prepared you are, the more likely you are to land the funds you need. Raise funding with confidence when you learn from us how to get funding for startup projects in place effectively and efficiently. Let our team guide you.
How to Raise Capital for a Startup Business
There are many ways to raise capital for a company. For some brand new companies, it can be difficult to find any type of support in traditional methods. Yet, when it comes to the methods of raising capital through venture funding and private investors, the doors open. Consider a few reasons why you need to learn how to raise funds for business startup efforts in new ways.
Let’s say you have a business and want to take your concept to the next level. You want to learn how to raise capital for business expansion, for example. You can try to find free government money to start a business like your own, but chances are, it will be difficult to prove the worth of your company.
Let’s say you need money to start a small business, and you turn to local banks to help you. Chances are good that they will not understand your business model, especially in the case of a SaaS startup. They can tell you how to finance a startup business with costly loans, but you’ll have to take dozens of steps just to get the door to open. In other words, it’s a long process with those who don’t understand what your company has to offer.
So, what do you do? How do you learn how to raise funds for business startup ventures for those who can actually support you and guide you?
Tech Startup Venture Funding
Focusing on tech focused venture funding is the route to take. Consider what it looks like to pursue venture capital funding as a tech startup. Tech companies tend to have a lot more pressure and struggle to find funding simply because most people don’t understand them. That is why specialized fundraising in this area tends to be best.
Angel investors tend to be one of the most sought-after type of investor method. AngelList investors are those who are perhaps the easiest to work with but the hardest to get to sign up with you. This type of investor is usually an individual or small group with available cash. They expect a higher rate of return than other methods. Investors looking for entrepreneurs often do so in areas they understand and are passionate about.
You can also learn how to find investors to start a business by looking at venture capital options. There are several types of VC funding, a method that involves more people who pool their money together to create larger investments.
Startup funding stages are also very important. To learn how to secure startup funding, you have to understand startup funding rounds. This is a series of commonly used tech startup funding in which an initial round of funding, moves from series A to series B and so on. Startup funding companies continue to support the business through Series D funding, Series F funding, and so on. If you want to raise funds for startup expansion, growth, a pivot, or other needs, you’ll work through stages to do so.
Startup funding stages are used for various types of funding, including by angel investors and VC funding. Yet, in every case, their goal is to provide funds to companies as they grow. Often, the cash comes in exchange for some type of equity or partial ownership in the company. A number of scenarios exist to help meet most needs.
Crowdfunding for Startups
Some business owners may not want to use traditional methods. They want and need funding, but they don’t want to lose ownership of their company. Crowdfunding provides that opportunity. There are many types of startup funding website based companies, including Seedinvest, Indiegogo, Crowdfunder, GoFundMe, and various others. Each one has a different style of function with various qualifications.
Using a startup funding website can be effective for some people. There are a few things to keep in mind. It is important to choose one with the lowest fees possible. You also need to develop a strategy that encourages people to invest. Many times, there are solid investors using these sites, but others, are built dollar by dollar by individuals. That means you need to have more people willing to contribute.
You also need to define what you are doing with the startup funding, meaning be sure to tell people about the company, why you are looking for funds, and why your company matters. Crowdfunding for business expansion, scaling, or other goals is possible if you have put together enough insight to support participants.
For example, to get enough people on the startup funding website to support your effort, you will need to get your business in front of a lot of people. You have to do the heavy lifting here – which means marketing your business fundraising efforts. You also need to be ready to offer something for free or some other reason why people should contribute. That is not always as easy to do as it sounds.
How to Raise Funds for Startups
No matter why you want to raise funds, there are many opportunities to do so today. You can learn how to raise funds for charity following many of these same avenues and methods. You can learn how to raise funds for a project that is important to you in the community. The key to doing well in this area is to have a clear objective and to tell people why this type of fundraising is so important. As you explore how to raise money for a cause, remember to make it personal as much as possible. That is, you want people to see why they should invest and, if they do, what good they are doing.
Another key concern is learning how to raise money fast for your project. Traditional banks may not be the fastest route. Instead, look for private investors like angel investors who share the same passion you do. These are most likely to be the professionals who want to work with you.
As you explore how to raise funds for startup goals like your own, remember that there is help available to you no matter the industry or the goal. If you are asking a question like this, “I am looking for investors for my business. Where do I start?” Turn to High Alpha for help and guidance. This is one of the best times to get your business moving. You just need the right tools and support to reach your goals. Let our team and our experience in helping startups like your own to guide you into making the right decisions.