Growing Your Startup
If you are raising money for your startup business it is important to showcase the key levers your business does efficiently that if a PE firm came in, you will quickly and swiftly be able to deploy the resources in those key levers to scale your business and provide a valuable return.
Some will go in on something as simple as an MVP, however many firms look for post revenue businesses that have a proven system that can use more resources to hire additional people, scale processes, or run more ad money into the top of the funnel.
Most PE Firms will want to see an exit plan within 5 years. If you are trying to bring in partners for a tech venture and can showcase a positive ROI within 1-2 years with the potential for a 200 – 300% return (and more within the first 4 years), it will be very attractive. However, some people will be perfectly fine with a long term play if there is a plan for raising future capital.
Traditional ROI are between the 5% and 15% annual return range. When going in on a business, whether a startup or a small to medium sized entity that is just getting its feet wet, most firms view this as a riskier alternative to the stock market or real estate and would like to be compensated for such if they are giving a capital infusion in kind in proportion to the risk tolerance they will allow for their portfolio.
The safer their return (in terms of the potential floor vs. ceiling of their capital), the closer you can come to the 15% return rather than the multiplier they are seeking with a buy in into a startup, but most business startups are riskier ventures that the firm is hoping will be the next unicorn and they would like to be compensated for such risk.Â
Showcase conservative realistic projections whilst still showcasing the attractiveness of the total addressable market.Â
Do not just add costs and expenses for the sake of it. The best ones to embark on are the ones where the founders have a clear understanding of their absolutely necessary expenses and what it takes to make it profitable with an exact timeline projection.Â
At JARBLY, we help you discover this.Â
Many startups will look to raise in the form of a seed round with an angel. If you are doing considerable business, you will want to consider a more serious affiliation with a VC firm.Â
The amount of equity you will may look to give up or debt you may have to take on will be dependent on how successful your business is and the potential for growth.
Contact us about your business to see if it would qualify and consulting on such regarding a pitch deck materials which we can be retained to create. We typically look for businesses with MRR above $15k+ but are open to a variety of businesses and concepts including pre-revenue.
Contact us to help you with guidance on your venture or startup:
Phone – (800) 773-1523
Email – support@jarbly.com
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Jarbly is a leader in business consulting with expertise in helping with revamped strategies, enhancing valuation, positioning for an exit, and business and real estate sales.
Contact Us
- Phone: (800) 773-1523
- Email: support@jarbly.com