Tips on Raising Funds as a Vegan Startup
So, you think you have the next big idea that will revolutionize the vegan market and even attract crossover customers? Awesome! But, without a minimum of funding, even the best ideas struggle to get off the ground. So, how do you find investors and successfully become the next household brand name? Let’s talk about some key tips to get you on the right track.
1) Build your network
If you’re new to the startup world and unfamiliar with how investing works, start by reaching out to trusted friends and colleagues who can help point you in the right direction. Build relationships with people in the investment industry and entrepreneurs who have previously launched startups. Attend conferences and tradeshows when possible, and make as many connections as you can.
2) Prepare a rock-solid business plan
Imagine you’re an investor. Now, answer this question: would you be willing to give money to someone with a great idea but no action plan? You probably answered “No,” because you want to feel confident that you’re not just throwing cash out the window. As an investor, your goal in spending money is making money down the road. Your business plan provides you with credibility and serves as reassurance for potential investors. It should demonstrate your company’s viability and scalability in the marketplace.
3) Do your homework on potential investors
Make a list of potential investors that may be in tune with your startup’s mission, and then take the time to dig deeper. Research their portfolio to see which companies they’ve backed previously. From there, narrow down your list based on your findings. Check LinkedIn for mutual contacts that may be able to facilitate a connection with your target investors.
More and more vegan investment companies are popping up, so those are a great place to start, but don’t discount traditional firms. Since brands like Beyond Meat and Impossible Foods have become mainstream, investors are more aware of the money-making potential of vegan products that were formerly viewed as niche.
4) Consider equity crowdfunding
Equity crowdfunding is similar to traditional crowdfunding, but instead of pledging a specific amount and receiving a product in return, you receive equity in the company. Asking everyday people to invest in your business allows you to seek out a highly targeted audience. Although securing large lump sums from individual investors on crowdfunding platforms is unlikely, the idea is to draw in high quantities of modest-sized investments. This is also a great way to ensure your investors are on board with your mission. Since your shareholders want to see you succeed (both from an ethical and monetary standpoint), they will likely promote the brand to their friends, family, and social networks. And boom! A grassroots marketing campaign is set in motion!
Being an entrepreneur is not an easy job, and a vision alone won’t revolutionize an industry or make you rich. However, with research, planning, and finding the right people to invest, what was once just a grand idea now has the potential to transform a market. So, let’s take these tips on raising funds into consideration, and go change the world!