We recently talked to Hossein Razzaghi, founder and CEO of Fancred, a fast-growing sports social network. Below, you’ll see some of the struggles and successes his company found during financing — and you’ll find some great resources to help your company.
Here is Razzaghi’s advice on financing:
You need to plan ahead
Our company invested a lot of time into forecasting costs for the first two years of our business. Since we were developing a social network, we knew that we’d need a huge capital infusion as we grew. So, we decided early on to talk to angel investors as well as venture capitalists.
We quickly found out that you need to make people believe in more than just your idea. They need to see that you have a plan for making your business successful.
You can’t do it alone
So we worked with startup incubator Techstars and found knowledgeable advisors that we could rely on. They helped us out a lot.
Networking is key
Once we started getting people on board with our business, we used those connections to reach more investors. A few fans go a long way when you’re raising capital.
You’re going to hear “no” a lot
Even with our networking connections, we learned early on that we had to put our egos aside and accept rejection. It’s hard, but all you can do is persevere — in a way, the rejection makes a “yes” that much sweeter.
Don’t stop at the first offer
Try to get more than one offer from different investors. We found that an investor could tell when we were desperate, and the terms in those situations were never favorable. Once we had some investment offers, we could leverage those with new investors. It takes some work, but you can tip the scales in your favor a little bit.
No matter how much you plan, you can’t predict everything. Your numbers will be off, or a deal will fall through. You always need to have a backup plan and be ready to roll with the punches.
Starting a business isn’t easy. If it were, everyone would do it. But if you have a really solid idea, the resources are out there. You just have to be willing to work for them and make other people believe in your dream.
Are you ready to fund your business? FedEx has plenty of resources to help you get started.
Looking for more ways to get ahead? Find additional resources for optimizing money-saving opportunities and financing your business at FedEx Smart Money Management.
The information provided in this article does not constitute legal, tax, finance, accounting, or trade advice, but is designed to provide general information relating to business and commerce. The FedEx® Small Business Center content, information, and services are not a substitute for obtaining the advice of a competent professional such as a licensed attorney, lawyer, accountant, or financial adviser.