Friday, 3 August 2018

Why am I not getting funding for my Startup Business?



Good morning Everyone,

You're welcome to another episode of Funding Friday!

If you have been in this startup game for as long as I have you would know that cash is the lifeblood of ensuring that you keep your idea alive whilst you work to build your customer base. 

Funding is the bane of why many ideas in Nigeria and even all around the world either don't come to fruition or don't exist for too long before they fail. 

I mean,

CASH IS KING



People tend to believe in the fairy tale that once you have found a built a product or a service that customers would usually follow suit. This is what it seems on the outside.

On the inside, the startup founder, or in our case, the startup team usually have to build our first prototype and understand how customers react to that product and continuously iterate the product to suit the needs and expectations of our customers. This continuous iteration process often requires money to continuously refine the product and the distribution mechanism.

Seems like a lot of grammar,

I pretty much mean, a startup requires money to reach product-market fit.


In Nigeria, it is much safer to work for a while, learn how processes work in a company, save up before launching your own business. It gives you enough room to bootstrap without living from hand to mouth and of course, you understand that the possibility of that business failing is much higher than it being successful so you have enough leeway to handle that eventuality.

For an Entrepreneur like me, I can't begin to iterate how many applications I have made to raise seed funding for HubbonNG so that we have substantial capital that would sustain us until our product is ready to officially launch and attack the Nigerian market aggressively.

Let me just iterate just a few applications that I have made over time

1. YouWin Grant (Local)
2. Growth and Employability Grant (Local)
3. Tony Elumelu Foundation Grant (Local)
4. Joan Agha Foundation Startup Grant (Local)
5. Mastercard Zambezi Prize (International)
6. CodeLaunch (International)
7. Facebook Accelerator (Local)
8. Young Entrepreneur Unilever Award (International)
9. Reginald Mengi's "Dream to Greatness" Grant (International)
10. Anzisha Prize (International)
11. Seedstars (International)



This list doesn't even reach 25% of all the applications that I made only in the month of June this year.


HOW TO FUNDERS PICK COMPANIES THAT THEY INVEST IN?

We both know grant applications aren't an exact science and when I was discussing with a friend a couple days ago and I informed him that these applications aren't an exact science. The funders would have to sieve through your application through these phases.

1. Completed applications. 

Incomplete ones are automatically thrown out.

2. Fit for purpose.

 Funders generally have particular businesses they fund (IOT, Healthcare) while some are sector agnostic. The ones that don't fit their mission are also automatically thrown out.

3. Market readiness.

This is where most of us get thrown out. We are either too early along our traction model that 
the funders don't consider our application to have enough impact that their fund would be able to gain an exponential effect. 

"Funders want to put their money on sure bets"


When you apply for a particular funding opportunity. Ask yourself, would the funder smile like in the picture above?

4. Your Team



Often times, as you continuously put in applications to funders you would see a pattern. Even when you are applying for a grant, they are interested in understanding you or your team that would be executing this fund and your capacity to actually build the company and create the impact that you must have sold to them as "larger than life". Often times, this is where the importance of building world class teams because vital. This is where most times, working for reputable companies before you eventually launch your startup works for you. Couple weeks ago, I met Onyeka Akumah, CEO of FarmCrowdy and his resume alone, working for companies like Travelbeta, Jumia, Konga, British Council as well as having run a startup that failed has made him any ideal candidate for any funder both on the local level and the international level. 

This is the reason that Uche and I, despite running our startup, take out substantial time to access learning material and build our portfolio's in order to build our skill set and credibility for funders. Your idea might be crazy good, but if the funders do not think you have enough about you to give you money, they won't. Simple as that.


5. Impact

If your application is airtight up this point, you have done well. Right now, the funders would then have to go on a whim and determine which businesses address a bigger pain point.





Compare these 4 Companies and choose which you would put your money on,

1. FarmCrowdy : https://www.farmcrowdy.com/



They empower farmers by finding well meaning Nigerians who would invest in their farms and the returns from the harvest would be split between the farmers, the sponsors and the company. They are ending poverty, one farmer at a time.

2. Snapchat:  https://www.snapchat.com/



They enable communication through pictures. Enabling you change the way people view you as well as move around through their snap maps. The pictures and texts disappear too. Everyone should jump on it because its fun.




Simple. Secure. Reliable messaging.

With WhatsApp, you'll get fast, simple, secure messaging and calling for free available on phones all over the world. (data charges may apply).

4. HubbonNG: https://hubbonng.com/



Effective and Reliable Shipping.

HubbonNG works with you to find a reliable delivery partner that would help you get your parcels wherever you want. We are investing in young people to make it simpler for people to ship parcels. Empowering the Youth, one rider at a time.



Let me give you a good way to measure and assess this.

Take it as some sort of guideline. Nothing you do not already know.


MASLOW'S HIERARCHY OF NEEDS



Let me give my own assessment since it's my article. You can give your own assessments in the comment section below

1. Farmcrowdy gets my money first. Because food is essential to everyone and if they are ensuring food security, they are already touching many lives. (Physiological needs)

2. HubbonNG, not because I work in the company, but because mobility is central to enabling people and goods to move around. (which comes in both part 1 and 2). I mean if farmcrowdy makes the food. HubbonNG brings it to your doorstep!



3. Whatsapp comes quick third because they ensure that people can communicate easily (Love and Belonging). They aren't possible on basic cellphones so its a sort of a luxury.

4. Snapchat comes far fourth, because it comes with esteem, I want to communicate and take custom and funny pictures. I don't need to worry that the person could blackmail me because the messages would disappear. LOL


You might be thinking, I might just be hyping HubbonNG.com

But think about it


You can get anything delivered to your customer, friend, family member within Abuja by booking a delivery on https://hubbonng.com/.

Become a regular customer and get access to great opportunities. Click here Sign Up on HubbonNG today!


Best regards,
Ejieji Muna
(Co-founder, HubbonNG)

No comments:

Post a Comment

Love the article? Subscribe to our mailing list

Most Viewed Posts

Contact Form

Name

Email *

Message *