One of the biggest mistakes tech startups can make is failing to realise that raising cash from investors can be a full-time job and take months. When you’re out and about, pressing investor flesh and running through your ‘show me the money’ presentation for the millionth time, who is running your business? Preparing, pitching, doing the books, reading the contracts and – hopefully – sealing the deal can be a time black hole and founders can’t afford to take their eye of the ball when it comes to their day job. So, in short, don’t.

My first tip for founders venturing into the funding process is surround yourself with the very best people that are capable and willing to run the business in your absence. As your business grows, you can only juggle managing your company with developing your product, marketing it, selling it and raising investment for it for so long. You also have to recognise that you’re not an expert in absolutely everything. Yes, I may know about marketing, have a little experience in marketing and have very strong ideas about marketing my business. But I’m not a marketer. I soon realised as we started going through the funding process and growing Huddle that I needed to get the very best people in their respective disciplines to help maintain that growth. So whether it is sales, marketing, HR, accounting or other areas, don’t try and wing it yourself. Hire people you trust to keep the company running and use external resource if you need to.

Careers business handshake meeting

If you decide to head down the venture capitalist (VC) route, also be prepared to kiss a lot of frogs. You’ll eventually find the right VC for you and your business, but make sure that you cast your net as wide as possible. VC funding isn’t a case of “one size fits all”, your proposition won’t suit every VC and vice versa. By meeting as many VCs as possible, you are giving yourself the opportunity to get the best fit possible.

When in the meetings remember that you’re the interviewer too and interviewing the VC just as much as they are you, so don’t be afraid to grill them too. You’re going to have to work with this VC for the next few years, so you need to ensure your ambitions and goals are aligned.

Finally, preparation is key. When meeting and presenting to VCs you need to know your figures inside out and back to front, so don’t try and cut corners. Figures you’ll need to have at your fingertips include user acquisition cost, cost to convert to paying, lifetime value, payback time, monthly churn, yearly churn and solid justifications for all projections. As well as knowing your company, metrics and product, you also need to know your competitors.

Be prepared, have a great team behind you and you’ll be ready to start the funding process!