1 min read It’s not about how much you invest; it’s how much investment you can attract
There’s an ongoing debate between investors and startups about how to bring more funding to the startup and growth stage companies. This debate has bubbled over with the blogosphere bantering posts back and forth between the investors demanding better startup deals and startups demanding more funding from investors.
The Argument
According to investors, there is plenty of money to be had. The startups argue the opposite.
Funding
The burden of funding rests squarely on the shoulders of the startups and the investors. The startups need to look nationally for funding as the world has gone vertical. Investors are increasingly looking for deals that match a specific criterion (e.g., a wearable value with $1M in revenue and a fundraise of less than $5M). The chance of a startup finding all its funding in a specific state or region of the US is quickly shrinking. No longer can you find all your funding in your backyard as the startup looks nationally; the range of competition increases. Startups must bring their A-game to the national table — B players need not apply.
The question is no longer how much funding you will deploy in companies but also how much your financing can attract from the national stage. The investor’s funding should be leveraged to bring in more dollars. All funds are limited, but its ability to attract more funding is unlimited. Investors need to build syndicates with their financing. Investors must bring their A-game to the national table — B players need not apply.
For those who are investing, thank you. Now let’s talk about how your funds can be leveraged to attract more capital, particularly from out of state. For those who are starting up a company — thank you, too. Now let’s talk about how you can take your startup to the A-game level.
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Hall T. Martin is the founder and CEO of the TEN Capital Network. TEN Capital has been connecting startups with investors for over ten years. You can connect with Hall about fundraising, business growth, and emerging technologies via LinkedIn or email: hallmartin@tencapital.group
