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MenuWhere can I start looking for funding for my business?
My business partner and I want to start a not for profit called AssureMom.com I need to know where to start looking for funding. AssureMom.com was formed to assist the elderly and their families with the services they need independent of what Medicare and Medicaid provide.
Answers
The funding of a non-profit can be a bit more complicated than banging on the doors of a bank. First, you will need to set up the corporation, next file for non-profit status with the IRS (1023), and lastly receive tax-exempt status from your state of incorporation. At the point of submission to IRS, you have a window of roughly 2 years to fundraise while you receive your approvals. However, many foundations will not fund you during that time. That leaves you to grass roots funding.
Your success will be based on a solid business plan, and a board that is experienced in oversight. Focus on the income and expenses when you write your business plan.
Good luck in your endeavor, you may find the reward in helping people gets overshadowed by the daunting task of running the company. Keep your mission statement handy!
Sounds like you have a non-profit organization pursuing funding resources that typically revolve around grants, private donors, equity-based investment, product review, membership/subscription revenue, or events sales through the community you are building. A multiple revenue stream approach is a good strategy for a new business that's still trying to determine it's primary funding source. But you need to focus your resources and do what's going to benefit you most to get past the early challenges of your launch. You need an assessment of your opportunity and clear strategy with tactics you can execute. Let's chat.
Related Questions
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We've been open 6 months and need more financing. What are my best options?Should I look for more loans or an investor?
That depends a lot on what assets you have, and what type of business you're trying to create. Do you already have a MVP version of your product? I hope so, six months in! One option is to pre-sell your product (beta version) to your audience, which not only helps with financing but also gets them involved with improving the product you're creating. You do have an audience, right? If not, stop what you're doing or building and go back to that stage. Don't build products in a vacuum.JM
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Is fundable.com a successful tool to help raise an equity seed round for a pre-launch startup?
We have used Fundable.com successfully for two rounds of financing both oversubscribed. Here is what I can tell you. Basic info: Fundable.com's platform connects accredited investors to startups seeking investment capital. Startups have a public facing profile that includes general information about the companies product, team, press accolade, etc. If you are raising funds claiming SEC Reg D 506(b) the public profile has no information about your securities offering. If an interested investor wants to view more information about your startup and or your offering, he/she would request access to your full profile. The investor must self accredit on the Fundable site before they are allowed to view your non-public profile. The startup is notified and you have the opportunity to conduct some due diligence on the investor (LinkedIn) and elect to invite them into your deal. Your private page includes the offering (terms). All communication from this point is done outside of the platform, meaning you have the investors email address ( a good thing to have). Fundable charges startups a flat monthly fee to post a profile on the site. In addition you can opt for additional services (help) with your campaign. For a flat fee, Fundable will assign resources to help build your profile, consult with you on your raise, and assist with PR or Marketing. This includes a blast to their investor base of over 40K if my memory serves me correctly. I am sure it is higher today. Our experience: For our first round on Fundable, we elected to use the premium service. Fundable did a great job in helping with our profile. We received 50+ views per day (quite often 100+) and on days we were included in their newsletter we received 200+ views. 10 - 20% of views requested access to our full profile. and 10-20% of those responded to my request for a call. Our close rate was very high. Both of our rounds were oversubscribed in less than 4 months taking averaging $50K per investor. These are high quality investors that have not created additional work (outside of normal investor updates). Many of our investors regularly share news and information about our industry. Several have re-invested in subsequent rounds. Disclaimer: Our startup is in the consumer hardware space which I believe tends to attract high net worth individuals. Obviously results may vary, thus I cannot speak to how well a SaaS play would do crowdfunding in general. Fundable.com's premium services offering may have changed since our campaign. I am not affiliated with Fundable.com. In fact we have been successful on other crowdfunding sites as well. In Closing: I am a proponent of crowdfunding in general. It is disrupting angel investing, providing investors with greater deal flow and exposing startups to an exponentially larger audience, increasing their chances to get in front of investors who understand and appreciate that company's solution and opportunity. Most importantly it is moving capital and driving innovation! Keep in mind, securities laws have changed and continue to change due to the Jobs act of 2012. Before you offer any securities to local investors or choose to try crowdfunding, you should consult with an attorney, and take the time to learn and understand what regulations apply to your circumstances.UB
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How do founders find the right investors when it comes time to find investment?
This has been discussed many times before and rather than repeating a lot of those things here, I will direct you to one of the best resources on this topic. Clarity CEO Dan Martel recently released a video "Raising Capital Like a Pro" that covers most things you need to know about fund raising. Here is the link: http://youtu.be/7dew9hhWBB4SB
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I have recently created a profile in AngelList https://angel.co/datacusp ? I have few questions relating to this from experts.
This is a very complex question. I have personally gone through funding, I've used angellist and other platforms for this purpose. The reason for needing funds is not a concern for you at this time. Your concern is approach. Focus on that. Check out my blog Http://Unthinkeverything.blogspot.com I have some books listed there that I recommend, I particularly did benefit a lot from the Presentations one that is there on the right in my blog. Your goal is to craft an image that engages with a certain type of Persona, similar to what you should do when crafting a marketing strategy to sell your product. Then make that pitch, angel profile, landing page, pitch deck... All speak to that persona only. All you have to do is convince one person, but if you trysts focus on pleasing everyone you'll end up with nobody. That's often true because investors go for the people running the business not the MVP or idea alone. Even a great idea if not presented correctly will lose opportunity. To give you more detailed insight and guidance give me a call. This is not easy but it is a lot of fun!HV
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What is your ultimate source for business research?
In over seven years of SaaS enterprise marketing, I have found Linkedin to be the best source of information for business research in my my industry - particularly competitive research. With Linkedin, I can: - Identify hiring trends – What are your competitors and contemporaries doing as far as personnel? Are they in the middle of a big hiring spree, or are they stagnant? This can offer clues as to how their business is doing, good or bad. A sudden trend in new hires might mean they are expanding. What could this mean? A new outlet, a new product line, a new service, or perhaps just a large increase in demand. Compare this to your own situation to see how you stack up to the competition. - Identify firing trends – On the flip side of personnel analysis, assess competitors’ downsizing trends. If a sudden reduction in employees occurs, this might be a good time for you to leverage your dominance. If your competitor is struggling, it’s time to increase competitive intelligence. All’s fair in love and business. - Identify hiring anomalies - Is your competitor taking on employees with new skills or with skills that seem out of place? This could indicate an expansion, a new service or something else that’s about to happen. With proper competitive intelligence research, perhaps you can figure out what’s going on and determine if it’s something you need to consider for your own business. - Scan competitors’ new connections – Is a competitor beginning to connect with people in a new business sector? If so, this could be an indication of a new project or a new trend. Study the connections to see what they have to offer and try to see where it could fit into your business. Perhaps you too will want to connect to them. - Locate competitors’ previous employees – A few minutes chatting with a competitor’s former employee can gain you tons of valuable information. Are they disgruntled? Perhaps they’ll be willing to let you in on some operational details. In the best situation, perhaps you can pick them up for your team. - Make connections with industry peers – Find LinkedIn professional groups that relate to your business. This allows you to make new business connections. If you run a salon or a spa in Maine, connect with other salon owners in Arizona to share advice. They’re not your competitors so there is nothing to lose by sharing secrets. I hope this helps! :)JR
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