Raising Funds for Your Start-Up
by: Stephen Tyrpak, Executive Consultant @ PQE Group
Although the number of startups in the US continues to increase following the pandemic, the funds necessary to grow these companies at the appropriate rate are not necessarily increasing at the same pace. The pandemic has caused investors to be more strategic and to lower the potential risk they may be willing to take. In the life-science startup world, this can be a very dangerous OR a very good time to initiate a business. I believe the best way to differentiate yourself when talking with investors is to have a fully realized go-to-market strategy and a cohesive, clear message that portrays a realistic sense of confidence, supported by facts, that the plan being presented is accurate and provides the fastest path to a lucrative ROI.
5 Initial Steps to Success
Although each company is unique, every company that I have helped has started with the same first 5 steps:
- Create a strong, multidisciplinary team
- Identify all relevant regulatory requirements
- Create a go-to-market strategy
- Have the strategy reviewed
- Market the strategy
Step 1 requires the identification of necessary personnel needed to support a go-to-market strategy that includes at least the following areas and strategies: U.S. regulatory and quality requirements, manufacturing, reimbursement, R&D support, sales and distribution, business development and fundraising and global market penetration. These areas are independent from each other but must be integrated into one cohesive plan. Once these resources have been engaged, whether they be full- or part-time employees or partnerships with third parties, the next step is to outline the prerequisites to reach the market. Understanding the minimum requirements needed provides a skeleton roadmap that all the other areas can be combined with to create a fully realized strategy, which should answer the following questions:
- How to get to market?
- How long that process will take?
- What is the potential revenue?
Once a strategy has been created, it is critical to have it reviewed by the prospective end users to understand if the product and the pathway to launch it is something the market needs and can accept and handle. The last thing to do before seeking funds is to create a strong, concise marketing campaign, with presentations and materials that allow investors to see the product’s potential and its prospective return. Without overwhelming investors with science or engineering, and with a clear understanding of the investment, you have a better chance of obtaining funds to start your business.
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