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  • How To Get Funding For My Idea?

    How to get funding for your idea is a question which leaves many dumbfounded. In this article i try to explain what you as an entrepreneur must do before you try to raise funds for your idea.

    By idea i mean that you have either a prototype or a working product. Having just an idea will get you no where as explained later in the article.

    Think of a worthy idea

    Before you try to raise money for your idea make sure it is worthy. The idea can come from anywhere. It can be a new and unique idea, or improving an existing one.
    However there have been cases where the most useless of ideas have been funded and I believe that is just a waste of energy and money.

    Do Your Home Work

    Before starting work on your idea you must first define a user persona which explains who your ideal user or customer is, what his personality is, what his income is, what inspires him.

    Build Your User Persona

    The user persona helps you to understand your ideal user and it will make it easy for you to build your idea and target to the correct market.
    You must then use your user persona to find a problem in your market and pitch your idea to them. If your idea solves a pain point for your market and if they accept it and are willing to either use or pay for it then you are on the right track. If you find something lacking then you will have to pivot and include what is missing, and get rid of what is not important.

    Build Your Business & Marketing Plan

    Always have your numbers ready.  An investor always prefers an idea which already is already being executed and has paying customers and sales.
    A business plan also contains your current costs, expected costs, revenue, expected revenue, etc…
    A marketing plan helps you chart out how you will conduct your marketing efforts. Having a business and a marketing plan explains what you plan to do, and also helps understand your business goals.

    Execution is Extremely Important

    An idea which has not been executed has no value. Unless you have done some form of work on the idea, no one will fund your idea. Executing an idea shows to the potential investors that you are willing to work on your idea.

    Even if you have not yet executed on your idea, but have done your initial homework even then you might get funding for your idea.

    Getting funding for your idea

    Getting funding for your idea
    Source for image: http://techzulu.com/wp-content/uploads/2013/05/vc-funding-now-what.jpg

     

    Where can I get funding from?

    There are a number of different sources which you can get funding from.

    Borrow from your family and friends

    This is the first place where you should go. There is a high chance they will give you the money  for being family but you have to prove them your idea’s worth. Also you might not have to give any equity since you are borrowing money.

    Look for Angel investors

    Before you can apply to venture capitals and have already exhausted your family and friends for funding, try to find an angel investor. They will either give a convertible loan or ask for equity. Angel investors invest their own money into these startups and as a safeguard also want a high return on investment as there are very chances that the startup will fail.

    Try To Get Venture Capitalists on Board

    Venture capitalists like the Angel investor invest money for equity. Before investing into a company a venture capitalist will have due diligence done and may not invest in your idea if they do not seem it to be a viable investment.

    Bootstrap your way

    If you can afford it it is better to pay from your own savings, then you do not have to share ownership with anyone. You can either spend from your savings or from your monthly paycheck if you have day job. You can also take on consulting work while you work on your idea. The money that you earn through the work can also be used to pay for your idea.

    Crowd Funding

    A new phenomenon which has taken the world by storm is the crowd funding platform such as kickstarter, and indigogo, where you can post the details of your project and your pitch and have others fund your project for no equity. If your project reaches the target then you will get the target. However, since there is no equity involved you have to provide the backers with something in return.

    Conclusion & Disclaimer

    There is no guarantee that your product will be funded even if you have done all of your home work and have a product. If the investor finds the investment to be a good one then he will do so, and also how you pitch to the investor will also matter. Even if you have the world’s best product but you get your pitch wrong no one will invest in your idea.

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    January 12, 2015 • Entrepreneurship • Views: 4229

  • Fire Side Chat with Badar Khusnood of Google Pakistan

    On Wednesday 19th November 2014 I attended a fire side chat with Badar Khusnood Pakistan Country Consultant Google, organized by Startup Grind Lahore which is powered by Google for Entrepreneurs. The host for the evening was Zohaib Khan Director of Startup Grind.

    Many things were discussed, where questions were answered from various topics such as incubators, accelerators, how a non-techie can play his role in a startup.

    Following is the round up of the things discussed:

    What Badar’s role is at Google Pakistan, and how he started his careers. He explained he graduated in Economics form Lahore School of Economics, and joined Nishat Textile. Then he moved to work for Small and Medium Enterprises Development Authority. He then further told us what he does at Google. He is involved in conducting market research and also helping Google understand the Pakistani market. He was also instrumental in the role of Google’s Chairman Eric Schmidt visiting Pakistan in 2012, and also the visit of Nelson Mattos, VP Emerging Markets Google.  Badar is also part of a Google Scouts program in which was started in 2005 by Google to scout for emerging markets in the world.

    The issue of youtube being banned in Pakistan and what it would take it to be un-banned. The main reason that he gave was that in countries such the offensive video which caused a hue cry has been banned in many countries, but the problem in Pakistan is that in order to do so youtube would have to be established in Pakistan with a domain of youtube.com.pk or youtube.pk and in order to do that legislations and laws are required to be in place for such a thing, but unfortunately in Pakistan we lack this. Google can not implement the ban just for Pakistan on youtube.com website as it comes under US laws, ad jurisdiction, while the .com.pk or the .pk version will come under Pakistan’s laws and jurisdictions.

    Differences between incubators, and accelerators were also discussed where the audience also posed their questions which were answered by Badar. Basically incubators are supposed to build a proof of concept of an idea, and the idea is validated at this stage. Accelerators come at the stage when the startups are to further grow and build their products and ideas.

    The models to generate funds for the company which companies follow, and he listed the following as the ones which a startup can adopt:

    • bootstrap your startup, that is spend your savings on your startup
    • ask your family and friends to give you the money
    • find an angel investor to invest in your startup
    • offer your time for money become a services based company doing freelance work for clients and then use the money earned to support your products
    • find venture capitals to invest in your company

    Google’s interests in Pakistan and also how Google has helped Pakistan in times of need were also discussed. We were told that USD $1 million were distributed to non-profit companies who were working to help ease the effects of the 2010 floods in Pakistan.

    Furthermore, it was emphasized that an entrepreneur should be a jack of all trades, and that he should acquire skills in the fields which require building, running and growing a business. Such fields include, technical (IT), marketing, accounting, sales, and administration. It is good to hire some one for that particular post, but if you are starting out, you should learn as much as you can.

    Networking is also very important, as entrepreneurship can not be done alone. Meet new people and find a common connection with that person whom you want to meet. The only way to do that is to get out of the building and to talk to people, attend events.

    After the talk I met with entrepreneurs from different companies, and shared ideas and discussed strategies with them.

    Overall the talk and the networking activity that followed was quite engaging and inspirational and i recommend that entrepreneurs who are starting out attend such events so that they too can learn and network with other entrepreneurs.

    The pictures below have been shared with permission from Startup Grind Lahore.

    The pictures were taken by ShutterWorks Photography.

    Updates: The date of the event was corrected. The actual date was Wednesday 20th November 2014.

    The source for the pictures was added.

    • Fire side chat with badar khushnood
      Fire side chat with badar khushnood

    November 25, 2014 • Entrepreneurship, Pakistan, Technology • Views: 3529

  • My First Lesson As An Entrepreneur

    Be like a bamboo, firm yet flexible

    Know when to stay firm on a decision and when to be flexible. That is key in maintaining relationships.: Just today I had to take a decision on a client which is bad for my short term  but good for our long term relationship with the client.

    Just yesterday I had to take a decision on a client which is bad for my short term but good for our long term relationship with the client.

    This is what as businessmen we have to do. What happened was that there was miscommunication between my business partner and the client. Apparently my client thought that we would be building the android app as well in the same cost that my business partner had quoted to him which my partner thought was just for the website.

    Another complication in this was that my client was a former colleague with whom I have had a good relationship in the past and did not want to spoil it.

    I found out only day before yesterday that we were to build an android app. My partner’s  mistake was that he misinterpreted. The client’s mistake was that he forgot to mention the app in the emails which went back and forth between the partner and client. My mistake was to not be part of the communication between my client and my partner from the beginning.

    I had two options in front of me:

    1. Demand that the client pays
    2. Bend and be flexible and facilitate the client

    I wanted to take the first option and demand money. I wanted to be paid. I deserve to be paid for the work that i am going to do. What would have happened either the client would have agreed and paid up, but that would deteriorate our relation ship with him, and there is a chance that he might not give his next project to us, or he would have taken the project else where.

    In both the scenarios we would have been at the loosing end. The client would have gotten his work done from someone else, but we would not have any work.

    The relationship was deteriorating between us and the client and I knew the problem lay at both the ends and this needed to be resolved. So I decided to take the bullet. I told the client that we will do the android work for free. I know I needed the money but I needed the project and future projects from the client as well, which i believe is better for us in the long term.

    I am a beginner at this and I am learning along the way of what I should do and what I should not do.

    Lesson learnt: Always be at all the meetings and be in the loop. I trust my partner but after this I have to know what is happening, and most important of all bend, be flexible like a bamboo.

    I would like to hear from your experiences. How would have you handled this situation? Did i do well? Only time will tell if my decision was right.

    Source of the featured image is Shutter Stock

    May 22, 2014 • Entrepreneurship • Views: 3179