One thing that high tech startups have in common is the need for seed funding to take innovative ideas from the pencil and paper planning stage into development, which is then followed by growth funding, where necessary funds are raised to continue to the production stage. As the sheer numbers of new startups out looking for backing grows, the difficulty in obtaining adequate capital becomes more difficult. Failure to find money at the right stage has buried many a good idea.
Ways to Grow a Startup
Besides meeting with angels, financial institutions, private investors and even taking the project to the public with crowdfunding, there’s another step that is often overlooked. Instead of leaving marketing to the end of the development process, it can actually make important waves that will catch the attention of investors before the production line is ready. According to Amir Hirsch, “Technology is not a prerequisite for business success, but marketing is.” Hirsch, an MIT grad, recently penned a post illustrating the advantages of strategic marketing early on, before the idea is has reached production. Similar to crowd funding, taking the product in progress to the general public can raise interest that will cause investors to be falling all over themselves trying to be the ones to back that project.
Validating a Customer Model to Attract Investment
A study that was done at Stanford showed that early marketing to the public can create traction in the market that would help in raising funding needed to get through the production stage. What is the best way to get your idea to the general public? Keep it simple. Don’t go into technical details describing why the product is so fantastic, but use simple tactics to tell your potential market what you are making and how it will help them. Compared to development dollars, marketing does not require huge sums but can build strong customer interest that can be perceived as lowering risk to potential investors.