In the lifespan of a startup, it’s a common practice to seek out funding to support growth and product development. This funding can contribute to vital activities that ensure success.In 2022, an analysis was done on why startups fail and found that 44% closed due to a lack of funding. With the current competitive state of venture capital, many entrepreneurs are fighting for funding, leaving them to look to creative solutions to support efforts.
Last year the available venture funding for startups dropped globally 35% from the previous year. It’s theorized that the market is self-correcting from the accelerated growth of 2021, but regardless, it feels as though funding has slowed down to a snail’s pace. Founders need to be strategic about how they position themselves for potential investments. A powerful method to attract new investor attention as well as increase existing investor confidence is through media exposure which has multiple benefits for companies. Telling your story and having that published in key publications along with enhancing your social media can expand your reach and validate the solutions offered by your company.
Drive The Conversation With Your Story and Mission
Having your company covered by the media can have a major impact on your overall goals as the reach of target publications can directly land in front of the audience that will move the needle for your bottomline. It increases brand awareness and creates a buzz around your company – which investors love whether they openly admit it or not. The validation of a third-party that is meant to be objective, lends credibility to your company and demonstrates a level of confidence from people in the industry that know the landscape.
Every business has a unique story but without proper media coverage your story may never get out to the masses. The companies that are able to successfully tell their story effectively and early are able to secure funding, accelerate their growth and develop products quickly. If your competitors are doing this better than you it can create a real advantage and vice versa.
Telling the story the right way for your audience also matters. There are many funding sources available so be sure to align your messages with the focus areas that are of interest to your investors. Creating a narrative in the media that resonates with the specific investors you’re approaching increases odds of closing those deals.
Embrace Social Media
Social media is known for garnering customers, but it’s also known to increase startups ability to find funding. A Wharton study found that an active social media presence increases the probability that a startup will close its round, increase the amount raised, and build more investor options. The Wharton study specifically focused on how Twitter influenced funding. For example, the study found that one deviation improvement in the Twitter influence measure brought up to $1.5 million in the 2nd round of funding. In comparison, the study noted that overdoing social media can have adverse effects, companies that tweeted over 580 times a year saw negative outcomes.
Having an active social media presence has other unique benefits for your company as well. It allows personal control over how your company is presented to the public and gives you a place to spread your own story and persona. Social media can help reach a broader audience and possibly position you in front of different types of funders.
Build Credibility Become a Recognized Industry Presence
A company can build its credibility through the means mentioned above can do the job but a fully integrated strategy that leverages industry events and awards can propel an organization to new heights. Awards that recognize your organization, executive team or product can signal to potential investors that there is market confidence in your solutions and that the team leading the company is competent. Especially if you are raising pre-seed/seed/Series A funding, this can support your pitches to these investors and highlight the lucrative opportunity to invest.
Some of the hardest thing to do prior to actually pitching is even getting in front of the people that can actually write a check. By attending industry events you can naturally bump into these investors, and if you are one of the speakers leading a discussion that elevates your name and organization even further. Networking is a powerful tool that can open many doors to your next funding opportunity and utilizing every tool to do so is just as important to your company’s long-term viability.
The venture capital industry is in an unpredictable stage. Startups and entrepreneurs need to nimble to succeed in these trying times. Utilizing the media landscape to familiarize investors with your company, the problem you solve and your unique benefits before a funding round has proven results. Whether you decide to up your social media plan, gain publicity through media coverage, or build up your standings through an award/speaking opportunities, your company will have best prepared itself for its funding raising.