Planning to Raise Capital The Strategy You Choose Today Will Change Your Company’s Future

Posted on Thursday, April 17, 2014 by BJ LACKLAND

Financing discussions for early stage software, technology and app companies typically focus on the sexiest and most elusive source offending - venture capital. But the truth is VC is not the only, nor the bestoption, for early stage businesses. There are emerging sources of capital that may make more sense for your business.

 

At Lighter Capital we spend a lot of time talking to earlystage tech entrepreneurs about what kind of funding makes the most sense forthem. With the proliferation of cloud-hosting platforms, the funding pinchpoints have changed considerably. Before, Series A VC rounds were considered critical for developing and launching products. But today most companies arelaunching minimum viable products after seed rounds or simply bootstrapping. Asa result moving from launch and initial traction to growth has become the most challenging part of the funding question.

Making the right funding choices at this stage affects the future trajectory of your company - how much control you will have over yourbusiness, and ultimately how much value you will extract from it.

What’s important – from launch to sustainable growth – is tomake sure you are aware of all the funding options and figure out what is rightfor you. Start with your long-term goals for the business and work backwards through the funding road map to determine what sources of capital are best at what points of development.

  • What do you want the business to look like in 1, 5 or 10 years? (Is your motto “go big orgo home” or “built to last”?)
  • Who do you want as partners owning and controlling the business with you? (Who makes the big decisions, the co-founders or the investors?)
  • What do youwant your role to be? (Will co-founders run the business for the long haul, orbring in “professional” management before long?)
  • How much capital do you need to grab the opportunity in front of you?
  • What are you willing to give up for that capital?
  • And finally, what forms of financing fit your goals at each stage of company development?

These are only some of the questions that help shape your company’s long-term plan financing roadmap.

If you are interested to learn more Lighter Capital ishosting a special webinar – Funding Options for App Companies on April 29th10am PDT / 1pm EDT. From startup through the $10M revenue milestone we discussthe different available funding options their pros, cons and costs and what toconsider when evaluating their fit with your business. You can register here.

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