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MenuWhat metrics are investors looking for in a fashion/clothing/apparel startup?
2 years in business w/ $2M+ in total sales. All online sales. 90%+ gross margins, 10,000 + unique customers,... BUT what specifically are investors most concerned with? Looking to raise $1M at a $10M post.
Answers
Team is more important than the startup itself. Investors prefer invest in the Jockey over the Horse. There may be n number of reasons for not getting through the funding rounds. If your startup is able to provide 10x return I can invest straight away. However, I will look at the team first and foremost and then I will look at the management skills and then I will come to other metrics like traction and scalability.
We just closed an investment for our apparel company. Our experience is that it depends on the type of investor. Different investor, different focus. We found many looking for a tech component, but that maybe had to do with our location and with the profile of investors we approached. They are looking for disruption. We were surprised that it was fairly easy to talk to potential investors. We customized the information based on the individual investors profile and interest. Happy to offer a call.
- repeat customers/revenues?
- LTV of customer vs user acquisition cost
- engagement of customers with brand
- growth rate
- management
There is much more and this question is hard to answer without more details. Set up a call and we can get you to the next level of understanding w/in 30-45 minutes.
j
Hi, Hope all is well!
If you are looking for raise in fashion clothing, I have some good ideas.
Best regards
Nagy Roshdy
Metrics that investors looking for in a fashion/clothing/apparel start-up are as follows:
1. Check Yourself (and Your Track Record): As an independent fashion business, do you know what your track record is? And, not just the track record of your existing business your track record as an entrepreneur, too. Before you get started, know what you are bringing to the table. Investors are looking to take on investment that comes from entrepreneurs who have had some relative success within their careers. Your entrepreneurial history and the results of your existing business models combined can paint the right picture to your investors.
2. Unicorn Status: What is it about your business that could be considered the next unicorn? Do you have access to a network of social media influencers? Does someone in your family own a factory? Start to think about the key things about you and your business model that stand out and make you unique. That is what investors want to know! When we think about companies like Warby Parker or Bonobos, they started small, and they were at the forefront of their times. Leveraging technology helped them scale so what is that element for your business? Here is another great example. For a company like Revolve, its unique value is in the social media celebrity-curated brands that are being produced.
3. Know What You Want: Lastly, do you know what you want out of an investor? This question is just as important as the flipside. Is another million-dollar investment going to take you that far? For a successful experience with an outside investor, you must first have a strong understanding of your needs, how you plan to use your resources, and what a prospective ROI will look like. As tempting as it is to model your business after Silicon Valley, just remember: As a fashion brand, you are not a technology company. While technology is part of the picture, you are not just investing in systems but in actual product and inventory. That makes it even more important and valuable to minimize risk for your investor, for your own business, and to ultimately maximize those returns.
Besides if you do have any questions give me a call: https://clarity.fm/joy-brotonath
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When raising money how much of equity do you give up to keep control? Is it more important to control the board or majority of shares?
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