Is Your StartUp Eligible For Fundraising Assistance?

If you’re a start up high growth business who needs to raise funds, we may be able to help.

Upstart can connect you with the Angel network and help to prepare you for fundraising; and as our Angel network is a partner with the New Zealand Venture Investment Fund you may be eligible for matched funding. That means that whatever funds you raise from Angels, NZVIF may match it dollar for dollar.

Startups which have experienced the most success with fundraising have often had a specific growth project in mind such as international expansion, and have at a bare minimum completed market validation and achieved proof of concept.

Most often companies utilising our fundraising services seek funds ranging from $400k to $700k although amounts up to $2m have been presented to the Angel network.

Why Would You Want To Fundraise?

Start up and high growth businesses frequently do not have the cashflow or resources required to grow the business at the rate that is possible in the marketplace. The rule of thumb is, if you want to grow quickly fundraising can help you do that – but you’ll need to know that with it comes responsibility to follow a business plan, have a constitution and shareholders agreement, and you’ll need to put a Board in place.

Sometimes your early investors contribute more than their money to your venture – they could contribute specific expertise and connections that may make all the world of difference to your startup. And yes, you will dilute your ownership in the startup as a result of fundraising. The theory is, a smaller percentage of a big pie is worth way more than a larger percent of a small pie.

An alternative is to bootstrap – use sweat equity, resourcefulness and influence, friends, family and your own money to grow your business. This way you retain full control and ownership, but you may compromise your growth.

What Does Fundraising Cost?

When you partner with Upstart to fundraise, you’ll pay a 5% commission. That means that it’s success based, so low risk for you.

What Do We Look For?

The Investment Committee will consider the following:

• The people/promoters of the business – their motivations, skills, talents, and history.
• The business proposition – is there an unmet met with identified customers who have a desire to buy, with competitors who do not represent a significant threat to the business, a strategic plan which can be executed effectively, and an exit strategy?
• Governance – who is on the Board and what is their expertise and history?
• The market and realities of execution
• Financials – do they make sense, strategies to counter potential downside, and assessment of what will happen when the first tranch of funds runs out.
• Intellectual property
• Minor shareholders and the nature of shareholder agreements

Although start up companies in business incubation usually achieve better fundraising results, all start up companies regardless of whether they are in incubation or not, are able to apply.

Please contact Murray Downes to discuss:  murray.downes@xtra.co.nz or phone 021 886 678