From seeking female-first fellowships to filling up your own cup, here are 13 answers to the question, “Female founders, what are some of the best pieces of advice you received about funding your business?”
Apply for PitchHER and Other Grants
One piece of advice I received about funding my business as a female founder is to look for grants and fellowships specifically designed for women entrepreneurs. Investors rarely consider these funds when launching or maintaining a business in the traditional venture capital fundraising process.
For example, I recently found out about PitchHER, a grant initiative from SheaMoisture that gives four women entrepreneurs up to $50,000 each year. Female business owners who get this grant could expand their businesses and reach new heights, which would not have been achievable without external funding.
Hire Exceptional Talent
Your brand is only as good as the people you employ. That is especially true for startups and small businesses. Investors want assurance that they’re not investing their money into a one-person operation.
They will want you to surround yourself with smart, talented, and hard-working people—those who have shown success at prior stops.
Make sure you have people you’re confident in and make sure you delegate responsibilities to them. Investors want to see a team of excellence, not just a single visionary, who fulfills their promises.
Use Personal Branding
As a female founder, you have the advantage of being able to attract investors, organizations, and companies who are interested in funding female small businesses.
In order to do so, use personal branding to make yourself the face of the company, make it more human, and identify and resonate with your audience, as well as attract people who are interested in funding female businesses.
Create a Brilliant Pitch Deck
If you want to win over investors, you first need to get in the door, which often involves sending in a pitch deck.
An interesting pitch deck should match your brand identity and clearly state your mission, the problem you solve, financials, employees, goals for expansion, and other critical data needed to decide whether your business is a viable addition to the market.
Your pitch deck should be confident and backed with research; convey why your business is different and why it will be successful.
Susan Shaffer, President, Pneuma Nitric Oxide
Ask and You Shall Receive
I learned a valuable lesson early on that there is nothing embarrassing about needing help. As women, we often mistake “having it all” with “doing it all”.
Asking for help feels like an admission of failure and a potential strike against us in an already biased industry. But there are just as many people looking to lift you up as they are hoping to break you down. If you don’t reach out and ask for what you need, you’re missing out on a world of opportunities.
And in nearly every sector, there are programs, grants, and support groups looking to even the playing field for women. Take advantage of these. The most successful entrepreneurs use every tool they can get their hands on.
Never Give Up
Don’t get discouraged. Whether you decide to bootstrap, acquire loans from family and friends, partner with angel investors, or turn to venture capitalists, the key is to be persistent. In the beginning, you may be told “no,” and that’s okay.
Don’t let a “no” stop you from funding your business. Reach out to someone else, continue to network, or look into funding your company yourself. It’s important for everyone, especially women, to not let a roadblock derail them. Keep on pushing until you find the funding you need.
Seek Long-Term Business Partners
Always approach potential investors with the mindset that you are looking for a partner who can help your business grow. Knowing that investor money isn’t just about cash, but about relationships is key.
It’s important to remember only to bring on investments when there is truly a benefit to expanding your business, as well as understanding what outcome you want and what shape or form partnerships would be necessary to achieve those goals.
Being prepared with an effective pitch and articulating exactly what kind of funding, help, and growth opportunities you desire can help ensure all parties involved have realistic expectations before signing a contract.
Sarah Gibson, Director, Proactive Healthcare
Reach Out to Investors While in a Good Place
When you look at what causes startups to fail, research shows that 40% of the time it’s because a business ran out of money and couldn’t raise enough in time to stay afloat.
To be safe, it’s best to start pitching your case to investors between six to nine months before you expect to run out of cash. This will also help you avoid negotiating with investors from a position of desperation.
Remember, the Biggest Offer Isn’t Always the Best
Taking the largest funding offer may seem like the obvious choice for a business seeking financial support, but this course of action may not always be the best decision.
This is because accepting the biggest offer might mean shouldering more debt or relinquishing a greater share of ownership in the company. Before deciding, it’s crucial to deliberate the specific terms and conditions of the funding offer, including the interest rates, repayment schedules, and equity stake.
Sometimes, a smaller offer with more favorable conditions might be a more favorable choice. Also, accepting funding from an investor whose vision and values do not align with those of the business could create conflicts and impede the company’s growth in the long term.
It’s vital to evaluate all funding options and pick the one that best suits the business’s needs and goals, rather than simply choosing the largest offer.
Look for Funding Before You Need It
You shouldn’t look for money when you run out of cash; that could make it very hard for you to negotiate terms and provide a high financial valuation for your company.
It’s important to look for funding well in advance before you end up running out of funds or start dipping into your margins. A potential investor wants to invest in a company that needs capital to grow, not to bail out of bankruptcy.
Bootstrap Your Business for as Long as Possible
Bootstrapping has several benefits, including maintaining complete control and ownership of the business, minimizing start-up costs and reducing expenses, and promoting faster learning through creative problem-solving.
By bootstrapping and proving the viability of the business, we can increase its value and attract additional investment in the future with a better negotiation position. Bootstrapped companies often have a strong sense of purpose and mission, which can foster a positive company culture and increase employee engagement and productivity!
However, it is important to note that bootstrapping may not be suitable for every single business, particularly those in industries that require significant investment in R&D. Sometimes, an external investment may be necessary to achieve growth and success.
Believe In Your Vision
Against all odds, I started my business. It was the 1980s, and I was a single mom with a big idea and a small budget. It’s still tough for women to get taken seriously in certain industries today, but back then, it felt impossible.
I can’t tell you how many rejections I received when I first started seeking funding. I was so often dismissed, disregarded, and overlooked that I lost faith in myself. A friend sat me down and said, “Just because they can’t see your potential doesn’t mean it’s not there. Focus on the bigger picture.”
She reminded me how important it was to believe in my vision, even if no one else did. I focused on exactly what I wanted and got really specific, not just about my business, but the life I want to live.
This gave me renewed confidence, boosted my resilience, and reinforced my sense of purpose. I pushed, persevered, and hustled until I had secured the capital to find my business.
Pay Yourself First
As women, we’re likely to take care of everyone else, including our business, first, and then we’ll take whatever remains financially or time-wise for ourselves. But then we can end up living off of scraps, as there are always unexpected business expenses.
Plus, when you’re working so hard and then struggling to make ends meet, you can end up feeling very discouraged. Pay yourself first to avoid that, even if it’s just a fraction of your previous salary.
When you take care of yourself, you’re in a much better position to come up with creative ways to generate alternative sources of income to fund your business.
Brett Farmiloe is the founder of Terkel, a Q&A platform that connects brands with expert insights.