By Fola Daniel Adelesi
Fundraising is a common in a founder’s journey. In a business cycle, there is a need to raise funds at one point or the other. But the question is how can this money be raised and from where?
People sometimes forget that the lack of funds is not always the problem. Whether you are an aspiring entrepreneur or already run a small business, there are some details you need to pay special attention to when raising funds.
Do not be discouraged when a prospective investor or creditor turns your proposal down. This does not necessarily mean the idea or value proposition isn’t brilliant, perhaps your fundraising approach needs a little tweaking. Rather than giving up or abandoning your project, consider these three elements of successful fundraising:
- Relationships: It is difficult to build a business without building relationships first. If you are solely counting on your knowledge and expertise to attract potential investors, then you are setting yourself up for failure. It is easier to get people you already have a relationship with to assist you in raising funds, rather than approaching complete strangers.
- Clarity of Purpose: Even where relationships exist, merit should not be ignored. Being familiar with your target audience is not a guarantee that they will fund your business. Before approaching them, put together a clear value proposition, supported by solid research and track record. You aim is to show the viability of the idea you need the funding for. Ensure that your idea is clear and concise to your audience.
- Strong Communication: Communication is key in passing your message across to the people you intend raising funds from. When fundraising, you must be able to tell a story that resonates with your audience, highlight your value proposition to them and the impact their funding and support will bring to the project being funded.
A good business proposal must show a value proposition that has been effectively communicated. The prospective candidates for fundraising must be convinced that you know your onions before they make any decision to support you.
While the points raised above do not guarantee access to funding, it sets you on the right path towards getting the desired support.
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