As an entrepreneur, I personally know how stressful the fundraising process is. When I first went through a funding round I was completely alone, depending solely on my personal knowledge of how the process should be conducted. That is why I founded RockThePost, an online investment fundraising platform. I wanted to create a seamless process of fundraising with entrepreneur support, easy access to accredited investors and highly vetted companies.
The first issue I noticed was how much time and energy I had to spend just to get in front of venture capitals. It’s a full time job! Knowing the sheer number of requests that they get, it makes sense that their rejection rate is so high. In fact, I was tweeting with Mark Suster a few days ago, a two time entrepreneur turned prominent VC located in LA. He posted a picture that showed 868 unread emails, which he said, is a good day. I wonder what his inbox looks like on a bad day. With 500,000 startups being created each month alone, it seemed like there was a huge percentage of companies who were just falling through the cracks.
The traditional offline fundraising process is long and stressful, most of your time is spent waiting around for a reply. Venture capitals receive thousands of submission each year, and clearly need a better way to sift through all of that clutter and find the brands they are actually interested in.
By utilizing this process online, every company can now create their own profile, available for all accredited investors to browse. This way, the process to invest in startups reviewing a company is fast and painless; with no back and forth phone calls or meetings.
Once the fundraising process moved online to methods like equity crowdfunding, it just opened up to an even larger crowd. Venture capitals are amazing for so many startups, but all those companies who are at the friends and family stage there are tens of thousands of accredited investors who would be interested if they had some way of accessibility.
That is where the floodgates can really open with online investments. By creating a clear company profile and uploading all of their necessary documents, each startup can showcase their brand, allowing potential investors to browse through their information before scheduling time consuming meetings.
Not only is it easier to browse these ventures, but the due diligence process is that much faster. With all the company’s documentation listed on their profile, investors can review all the necessary information at their leisure. Not only does this make the process more convenient, but also it allows for these investors to review a greater number of raises in a shorter span of time. Most investors are stretched very thin and don’t have the time to spend searching for investments. This way, the process is brought to them in a quick and easy manner, widely increasing the pool of investors.
Once an investor indicates their interest in a company and wants to move forward with startup investing, the company itself must then approve them to ensure that both parties are satisfied with the partnership. It really is as simple as that. Once both parties approve of each other, the investment can be finalized online.