Fundraising for a startup in Kenya is challenging. Not only is the venture capital pool not big and as established as that in Silicon Valley, but also the appetite of angel investors to invest in untested business models is very low. With most angel investors flocking to real estate, it is especially hard to get a technology startup funded with no previous bona fides. We are going to see how you can increase your chances of getting the first response which can into an investment here. Let’s dive in.
Craft a compelling pitch
Angel investors and venture capitalists receive hundreds of pitches each day. You want to answer the most compelling objections that might get your pitch deck booted before even the first meeting. A pitch deck that is well done acts as the hook that draws them in and encourages them to learn more about your startup.
- Clarity and Uniqueness: Clearly articulate your startup’s value proposition and what sets it apart from the competition in a way that investors quickly understand the problem you’re solving and why your solution is unique.
- Structure of a successful pitch: Break down the essential elements of a successful pitch, including a captivating introduction, a problem-solution narrative, market opportunity, revenue model, and a compelling call to action. You can then approach each element with the most likely objections from investors and try to answer each of those questions in the elements.
Building a robust business plan
This can vary with the industry the startup is in. You don’t have to come up with a 21-page business plan of an untested business plan with very rosy projections, you will not convince anyone to part with their money. As such, building a minimum viable business plan that highlights what’s in the product or business roadmap and how you plan to get there could be vital to showing your self-awareness.
3Demonstrating traction and milestones
There are startups that are funded with just a pitch deck and no product. But you know what? Those are the outliers and more likely than not, it will be by a serial founder who has an exit and has developed an extensive network. Otherwise, as a first time founder, it’s important to show evidence that your startup is gaining traction with the target market you claim to be going after. Demonstrating early success can significantly influence their decision to invest based on what you have been able to achieve while bootstrapped.
Additionally, you can show the milestones you have been able to achieve within a certain period of time. It’s not pretty to show you crossed the 100-user mark after one year. You need to show continuous progress even with limited funds.
Investors want to see evidence that your startup is gaining traction and making progress. Demonstrating early success can significantly influence their decision to invest.
Showcasing a strong team
If you have the right people in the bus, the destination is not important. If you get a road bump ahead, with the right people onboard you can quickly pivot. This is what investors want to see from a founding team. As such, founders with complementary skills have a higher chance of getting funded as they can get from zero to n without needing to hire a bunch of people.
So you need to show investors why your team is better positioned to win in the chosen market compared to other established businesses or upstarts that may crop up. Because, ultimately investors are investing in the team, especially when the venture is very young.
How to get investor funding in Kenya
As already intimated, getting funding in Kenya and Africa as a whole for an untested business is very challenging. Add to that you are a first time founder and the hoops you have to jump through to get that first check increase. In view of that, you can dramatically your chances of getting those first meetings which can turn into investments by following the tips we have highlighted. There are other disparate factors that can come into play before you are funded, but it’s better to be well prepared rather than go with faith.