Fundraising is one of the biggest challenges of any startup. Swedish App Scene was able to interview Emmet King, Partner & CIO of J12. A venture company that invests in early-stage start-ups. He is also currently nominated as an investor of the year in the Nordic Start-up Awards 2018.
He shares some advice on how to find investors for your start-up.
What advice would you give entrepreneurs in trying to find investors or collaborators?
“If we are thinking about very early stage entrepreneurs who are looking for first investors and these may be individuals or angel investors, the best approach to take is to look for advisers first. Find people who have some value that they can add to the type of company you’re trying to build. People who are like-minded, enthusiastic and passionate about the vision you have or the type of product you have and that would be willing to help you before investment becomes an option.
Finding good advisers who can and are willing to help with what you’re doing and to turn those advisors into investors when the time arises it will be a natural progression.”
Emmet advises entrepreneurs to look at the way they do product development – as an iterative and co-creative process involving potential customers along the way – and attempt to replicate that approach when looking at the process of fundraising. Which results in entrepreneurs seeing their company in some sense as their product and their potential investors as customers.
This change in perception will be able to help entrepreneurs create a more valuable relationship with their investors.
Do you think it’s important for early start-ups to be a part of accelerators or incubators or is it possible for a start-up to grow independently?
“I think obviously it differs from case to case. It’s definitely possible to build a company without an incubator or an accelerator, its not a requirement. There’s a lot to be gained from being a part of the ecosystem, you’ll be able to share experiences with other founders, learn from their experiences and get access to a network of partnerships or investors. It can be an efficient way to reach a lot of the people that you would want to reach and to learn quickly. But I think it depends on who you are as a founder if that’s an environment that you will know you will thrive in.
Certainly, I would say that people shouldn’t lean on being part of an incubator or an accelerator as a stamp of quality or progress”
With all the different ideas and innovations that are coming up what do you think will be the next big thing?
Emmet mentions that he’s excited about the innovative ideas involving Artificial Intelligence, Blockchain and health tech.
“I think it’s exciting to see where smart and visionary entrepreneurs can harvest the emerging technologies towards good use cases and break through all that is hyped around them to really find a good use case and build a business around it.”
He says that creating a unique use case for these technologies would give start-ups a great advantage.
Is there a certain trait or criteria that you are looking at when deciding to invest in a start-up?
“We are looking at very strong founding teams. What we define as a strong founding team is we often talk about in terms of the soft characteristics. Founders who strike at the difficult balance of being expert and incredibly knowledgeable about their field but still retain the humility, curiosity and coachability to seek all information from other people, to take advise from others to be ready to be proved wrong by data or by customers or by whatever else.”
Aside from a strong founding team, Emmet explains that they are looking at big opportunities with reasonably high product risk and perceived low market risk. Products that from a technical or execution standpoint have a certain level of complexity, targeting large markets that are not too crowded, timing not too late, and a clear visibility towards sales and growing market share.
Looking for investors might be daunting, but Emmet encourages entrepreneurs to start approaching investors as early as possible. These conversations should help founders in several ways, not least in understanding what kind of capital they want to bring in and who they want to invite to be a part of their company.
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