www.simplyaroma.com
I agree with Ian. This is the kind of business that is unlikely to appeal to a VC. Private equity investors might be attracted to this at a much later stage of the business, but at the early-stage, this is a difficult business to fund with outside investment.
Your challenge, and really the challenge of any small business entrepreneur is that investors are going to look for a *significant* ownership stake in your business for a relatively small amount of capital. For something like this, it wouldn't be a surprise to see an investor ask for 30-50% for $50,000 to $100,000. If you really are confident that you can generate $1,000,000 in your first year (although most businesses in any sector don't), then I'd encourage you to find personal loans from friends and family that will provide you the needed cash.
Happy to talk to you in a call to explore your options in more detail
I work with some very large companies that can not find a VC even with a great product. In my opinion, you are concentrating on the wrong thing. Concentrate on the market before the product. Once you have sales you may or may not want a VC and you may be able to say no to some bad offers.
I agree with the other answers. But one additional source of investment is the suppliers who will benefit from your $1m in first year's business. If there is trust between you and them, there may be forms of investment they are willing to make. Could be money. Could be credit terms (i.e. "pay in 90 days"), and so on. Similarly, if there are major customers who will benefit from this business (maybe a marketing agency you put on parties for, for example), they may be able to kick something in.
Hi there, I've worked for a VC firm running a consulting practice and advised pre-revenue startups on their fundraising. Sorry, as others have mentioned your business is unlikely to attract VC investment (service-based businesses are usually unattractive to VC's).
The first question I would ask is, if an investor were to give you all the capital you asked for, what would you do with it?
If it's for purchasing equipment, perhaps you could get favourable vendor financing. If it's hiring employees there could be a government granting program that you qualify for (I know this exists in Canada for hiring young employees).
An old boss used to say 'equity is like toothpaste, once it's out it's really hard to get back in.' So with any investor take a hard look at why you need the money in the first place and if there are non-dilutive options you can pursue first to accomplish the same goal.
I hope this helps!
I have 25 years of experience working with early stage technology companies and investors.
I’m often asked about fundraising strategies for VC funds and angel investors. After raising capital and exiting from multiple startups and investing through 15 venture funds and dozens of angel investments I have seen thousands of deals.
I’ve found that the most productive use of time for both of us is scheduling a call through my profile.
