Talking to tech founders, developers, venture capitalists, or tech journalists can be mono-dimensional. Some people in this ecosystem don’t even think about the possibility to start a company without venture capital. They forget that there are many ways to build a successful company outside the venture capital track. For example, you can build a business that actually makes money from early in the beginning, and those revenues actually exceed the costs and not the other way round! If you can build such a company, e.g. consulting businesses, or agencies, don’t worry about investors, and go for it.
APX and other venture capital investors – such as business angels, venture capital funds, family offices – invest in different companies. Those companies depend on venture capital to ultimately reach profitability. They cannot grow at all without it, or they can’t do it as quickly or successfully. They can’t take off without external funding – and traditional financiers, like banks, typically don’t take the risk.
Presuming that your business idea requires venture capital funding: you want to validate your key assumptions. Is your product solving a real problem of a real customer? Who is paying whom for what, when, and how? Is the market big enough so that your company can earn investors a high return for their venture investment? Who are your direct and indirect competitors?
Venture capital investors will challenge you on various topics. They need to understand, inter alia, your vision, KPIs around early traction, your financial model including unit economics, your product plan and roadmap, sales and marketing, and your team setup. You should make sure that you can deliver accordingly, and be prepared.
Throughout more than 100 initial investments at ASPnP since 2012 and 30 at APX since 2018, as well as hundreds of follow-on financing rounds, our team has a solid understanding of what venture capital investors will look for. Through the APX cash investment and our Tailormade Program, we will share these insights with you. And we will unlock our broad and deep network of mentors and experts. Through this, we will all help you to become ready for the next investors.