Want to learn how to raise funds in large amounts for a business or project?
Maybe yours is a capital-intensive business, or you’re at that point in your company where you need a major infusion of capital to grow, expand or turn around the business.
In my experience, when it comes to fundraising large amounts for business, the higher you go, the harder it becomes.
It’s hard. But the good news is, it’s not impossible.
In this article, I’ll show you how to raise funds for a business, especially if you need large amounts of funding ($500,000 and above).
These insights are distilled from investor activity, market realities, real-life success stories, and my first-hand experience working with students and clients on the frontlines who are trying to raise significant amounts of funding for business.
You’re going to learn quite a lot from this.
Let’s get started!
1) Pitch at a major business competition
In 2018, a Ghanaian start-up business known as Agrocenta won $500,000 in investment at a pitching competition in Geneva, Switzerland.
This annual competition, known as the Seedstars World Summit, features entrepreneurs and businesses from across the world who pitch to an audience of investors, international media, and other stakeholders.
That year, Agrocenta beat 65 other finalists from across the world – including 21 from Africa – to win the $500K grand prize.
At the time, Agrocenta was a small company with an online platform that connects smallholder farmers to a wider market, access truck delivery services, and real-time market information.
Every year, there are dozens of competitions just like Seedstars that provide strategic opportunities for entrepreneurs and business owners to raise funding to support and grow their businesses.
Entering most of these competitions is free. You don’t have to pay anything.
All you need is an innovative or impactful business, and the ability to confidently and convincingly pitch your business on stage to investors.
Unfortunately, many entrepreneurs don’t know how to find these competitions or how to pitch their business in a way that increases their chances of raising funding.
That’s why we created The Funding Masterclass.
Inside our Funding Masterclass, you will learn how to raise funds by targeting major competitions, and how to package and pitch your business before an audience in a way that positions you as an attractive investment opportunity.
2) Convince venture capital investors
If you’re looking to raise up to $500K or more for your business, venture capital is a great option.
Venture investors have very deep pockets. Every year, venture capital investors alone invest over $300 billion into all kinds of startups and businesses across the world.
According to KPMG, the average investment is about $1.2 million for seed/angel deals, $4.5 million for early-stage deals, and $9.9 million for later-stage deals.
In Africa, venture capital investments have significantly risen from just about $277 million in 2015 to almost $2 billion in 2021.
And several entrepreneurs and businesses are successfully attracting funds from venture capital.
In early 2021, Flutterwave, a Nigerian business that helps businesses accept payments online, raised $170 million from a group of venture capital investors.
In Kenya, Pula, a company that provides agricultural insurance to farmers, successfully raised $6 million in venture capital.
And there are several other success stories just like these.
However, raising funds from venture capital investors is not exactly easy. The competition for venture capital can be very fierce.
Having a good, lucrative, or innovative business may not be enough to attract venture capital.
That’s why you need to understand how venture capital works, what the investors are looking for in a business before they invest, and how to target, approach and pitch to venture capital investors in a way that maximises your chances of getting their money.
Inside our Funding Masterclass, you will learn where and how to raise funds by targeting the right venture capital investors, and how to engage them until you close a funding deal that works for you.
3) Get a credible backer
South Africa’s Anna Phosa has built a successful piggery business by having credible backers.
Many business owners are unable to raise sufficient capital from the banks to grow their business.
And it’s a very frustrating experience for entrepreneurs who don’t have the collateral, track record, or guarantees that most banks ask for as a condition for extending a loan.
But this is a fixable problem if you can find a credible backer for your business who can influence the bank’s decision in your favour.
This was the exact strategy used by Anna Phosa, the founder of Dreamland Piggery & Abbatoir in South Africa, to raise a $1.9 million loan from ABSA Bank to expand her business.
Based on a major contract with Pick ‘n Pay, a major supermarket chain, to supply 100 slaughtered pigs a week, Anna was able to get the loan and expand into a 350-hectare farm property.
Your credible backer could be a major customer, a key supplier or distributor, or a strategic partner who can give your business the clout it needs to be attractive to banks and potential investors.
For Paystack, the Nigerian company that raised more than $200 million in less than 4 years, its credible backer was Y Combinator, the US-based business accelerator program that introduced the first early investors to the company.
In our Funding Masterclass, you will learn how to raise funds by finding credible backers, and creative ways to leverage partnerships and relationships to increase your chances of raising funding for your business.
Some of our students have raised funds from alternative sources because they were able to develop and structure deals, partnerships, and relationships with credible backers.
If they could do it, you can do it too.
4) Have a new, unique or innovative business concept
The “Omni-processor” waste recycler raised over $1 from the Bill & Melinda Gates Foundation.
The world is changing fast. And to stay ahead, businesses have to find innovative and creative ways to beat the competition.
That’s why investors are more attracted to businesses that are built on an innovative or disruptive concept.
The truth is, if there’s nothing new, unique, different, or revolutionary about your business that gives you a competitive advantage, you’re really going to struggle to raise any serious funding from investors.
And there are several interesting success stories that prove that investors are biased in favour of innovative businesses.
Bridge International Academy’s low-cost and technology-driven innovation to primary education in East Africa attracted over $100 million in capital from investors that include the Omidyar Network and Mark Zuckerberg of Facebook.
Janicki Bioenergy (now Sedron Technologies), the company that developed an “Omni-processor” that recycles human waste into clean drinking water and electricity, raised over $1 million from the Bill & Melinda Gates Foundation.
Interestingly, when you track the kinds of businesses in Africa that continue to raise funding from investors, you will find that they’re based on innovative products or services in industries like agriculture, e-Commerce, retail, financial services, healthcare, etc.
In our Funding Masterclass, you will learn how to raise funds by understanding how investors assess a business before they invest, and how to position the unique and innovative aspects of your business in a way that makes you more attractive to potential investors.
5) Target international development funding opportunities
Yalelo, a Zambian aquaculture business has raised millions from international sponsors.
Sometimes, you have to look beyond your country, region, or local environment to raise the kind of capital you need to grow or turn around your business.
Every year, billions of dollars are invested by international development funds in a wide range of for-profit and non-profit initiatives.
Most of these funds come from private charities and foundations, and agencies of the UN, World Bank, regional development banks, and development agencies of foreign governments like the USA, the UK, Germany, France, China, Norway, and several others.
These funds are often available as grants, low-interest loans, or private equity investments.
USAID awarded grants of over $2 million to solar energy companies in 9 African countries to provide off-grid electricity to nearly 300 healthcare facilities.
Humania, a private healthcare company in Egypt, raised $125 million in funding from a group of international development funds that included the World Bank’s IFC, the OPEC Fund, the European Bank for Reconstruction and Development.
In 2019, FinnFund, Finland’s investment fund for developing countries, invested $6 million in Yalelo, an aquaculture company in Zambia.
Despite the availability of significant funding from these international sources, many entrepreneurs and business owners still don’t know how to access these opportunities.
Inside our Funding Masterclass, you will have access to the profiles and contact information of several international development funds that actively provide grants, loans, and investments to companies and businesses in emerging markets like Africa.
You will also learn how to raise funds by applying for these funding opportunities in a way that boosts your chances of getting financing.
Raise Up to $1 Million for Your Business.
Are you looking to raise between $10,000 and $1 million (or more) for your business, project, or non-profit?
Have you been trying to raise money on your own without much success?
We can help you overcome this problem, so you can finally raise enough money to start, grow, or turn around that business.
Since 2015, members and alumni of our program have used creative strategies to raise over $5 million in grants, equity, and debt funding for different types of businesses and projects.
And we can do the same for you, if you’re willing to learn and apply the strategies we’re going to show you.
But first, we need to know if your business or project qualifies for funding.
Don’t procrastinate. This will take less than 2 minutes.
See you inside. 🕥