NEWS17 October 2024
If you’re a tech or STEM entrepreneur wondering why some startups are more successful than others in securing funding, then here are five tips from an expert to help your fundraising and accelerate your startup’s success.
In this blog, Iain Jamieson, a longstanding and seasoned angel investor and the current Chair of the prestigious University of Surrey-operated S100 angel investment club, shares valuable insights.
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Iain’s five tips below are a small extract of a more in-depth interview.
For more expert insight from Iain, download our special 4-page, magazine-style Spark Article, which is packed with detail and actionable suggestions to support your business.
Tip 1. Have a Robust Plan
It may sound obvious but Iain and his fellow angel investors expect to see a robust business plan that includes a robust financial plan.
He says: “There’s a very high quality of business that’s looking for funding… Some businesses can start generating revenue straight away, others need investment to develop a product to then take to market. So, it’s about understanding the commercial situation that they are each in and how their business will realistically evolve over the next two or three years.”
Entrepreneurs must rigorously prepare and refine their business plans to meet the high standards expected by investors.
Tip 2. Understand and Address Market Gaps
“It’s all about knowing the market… and plugging those gaps,” advises Iain.
“If they know their market really well and can show that the gap exists and can explain how they are going to plug it, then obviously that’s a big thing.”
Demonstrating a deep understanding of your target market and clearly articulating how your product or service meets an unfulfilled need is crucial for attracting investment.
Tip 3. Be Realistic
While Iain looks for passion and drive in pitches, he cautions entrepreneurs about the dangers of overly optimistic revenue forecasts: “Many entrepreneurs come with these fantastic revenue expectations, which is good in terms of their ambition, but it rarely plays out like that.”
He explains that starting a business is tough, often involving bootstrapping and limited initial funding. It’s vital to present a grounded and pragmatic financial outlook to potential investors, acknowledging the initial challenges and demonstrating a clear, realistic path to revenue.
This honesty not only builds trust but also shows that you are prepared for the rigours of entrepreneurship.
Tip 4. Develop and Show Strong Governance from the Start
With the increased focus on Environment, Social and Governance (ESG) in running a healthy business, Iain is keen to emphasise that “Good governance can start early”. He adds: “I see a lot of business that are rightly very conscious about the environment – the E in ESG – but it’s often the G bit that needs be developed further”.
Implementing strong governance practices early can enhance your business’s credibility and scalability, making it more attractive to potential investors.
Tip 5. At the end of the day “It’s personal”- Build a Strong Personal Connection with Investors
Iain describes the angel investing process as “Personal” and the most successful pitches tend to be those that: “Strike a rapport early on in their pitch, otherwise they quickly lose their audience of investors.”
Establishing a strong rapport with investors is critical, as many see their contributions as personal investments.
For first-time entrepreneurs and those who are more naturally introverted, being part of a business incubator, like the one at Surrey Research Park, can make a huge difference.
Our award-winning SETSquared Surrey business startup incubator – recently ranked No. 1 in the UK and No. 3 in Europe by the Financial Times – offers access to business mentors, workshops and unique networking and funding opportunities, helping to equip you with the skills and knowledge to impress investors and grow your business.
Find out more about our business incubator packages and prices.
