As for Ravid, he has led and sits on the board of multiple startups in Bangladesh. Prior to venture capital, he worked in Private Equity for a few years in New York and Hong Kong. He was the first CFO of Pathao and led the company through several funding rounds including the GO-JEK investment.
In a recent interview with Future Startup, Mr. Ravid shared 05 practical tips from an investor’s perspective for founders who are trying to raise investment.
From Ravid Chowdhury:
First, think about whether raising external capital is the right move for you and your business. Once you have investors, it’s no longer just your company. It is like a marriage, where you will have to make decisions together and answer to a board of directors. Also, make sure it is the right investors for you and they can add some strategic value beyond capital.
Be prepared. Have a pitch deck, financial model, company metrics and a data room ready. Try to anticipate follow up questions investors will have and have materials ready so you can reply immediately.
Be prepared for a lot of “Nos” and don’t take it personally. Be gracious, polite, diligent, and persistent – not pushy.
It might be a “no” today, so ask if you can follow up in a month or so with an update on your progress. After six months to a year of observing your company, and seeing the growth of your metrics, team, and execution, that “no” will turn into a “yes.”
In terms of advice for raising, just be honest and transparent. If your sales didn’t go well last month, just say so. Don’t try to conceal it or spin it. Good investors will be able to tell if a founder is being deceptive. At the end of the day, these relationships are trust-based.
I believe the most important thing about investing in early-stage companies is the founder(s) and team. In terms of skills or traits, the number one is always honesty.
After that, there are so many hard and soft skills a founder needs to master in order to be successful. Do they have the right technical skills and relevant work experience? Can they hire the right people and inspire them? Can they maintain maturity and a clear head in difficult situations? Are they good public speakers? Are they open-minded to new ideas? Do they understand how to analyze data? Can they separate their biases from decision making? Do they understand the basics of finance? There are too many skills and traits to list. And people like this are rare – I definitely haven’t mastered half the above things I mentioned myself, but I’m working on it.
Raising investment is challenging for almost every founder. Raising investment is harder than running a business, says a founder in a recent interview with FS. Understanding this tough reality is critical before embarking on your fundraising drive. The psychological aspect of raising money is much more precarious than the real hardship of it. So be prepared mentally. If you are building a startup, we have some good reads on how to startup and build a startup in Bangladesh, you can find the collection here.