Fundraising lessons from a serial entrepreneur

I am a serial entrepreneur on my fourth venture since 2001. I am proud to have launched four successful cash flow positive companies in the past 16 years. Not all of them required significant capital to launch, and only one, my current venture, PopCom, was ideal for venture capital.

With the other three I raised seed funding from family, won money in pitch competitions, took out working capital loans, bootstrapped and relied on revenue for operations.

Before I decided to raise capital, I considered three things. How much I needed to raise based on what it would cost to operate for 12 months? What type of funding I should seek? Popular business funding includes loans, grants, accelerators, crowdfunding, angel investment and VC. And who my ideal investor was. There is no right answer to these questions. It varies for each business and stage of the company.

PopCom is an automated retail technology company. We have developed a SaaS (software as a service) product for vending machines and digital kiosks to collect customer data at the point of sale. This is a tech-driven business model, so I knew a combination of accelerators, angel investors and VC would be needed to get this company off the ground. Instead of bootstrapping and moving at a slower pace with limited resources, I realized the value of securing VC to scale.

To date, I have raised $1.3 million from investors. It is important to be aware of your valuation and dilution, and do a thorough assessment of ownership percentages and value of equity in each round of investment. Investment and VC financing doesn’t represent “gifts,” therefore structuring a plan for your capital is imperative.

Here are some of my biggest lessons from fundraising:

  • Never take no for an answer. To me, “no” just means not right now. You can always go back. A prime example of this is most of my current investors told me no once or twice. I never stopped updating them, calling them and never stopped working. It paid off.
  • Don’t listen to the noise … and there is a lot of noise and fake news, especially around female founders, regarding what we can do, what we have done and our success (or lack of success) rates. Don’t compare yourself to other founders or companies; keep your blinders on.
  • Make informed decisions about raising capital because it can be a costly distraction. With all of the meetings I had to attend, only 15 percent of my time was spent on my business and 85 percent was spent fundraising. For me, that was a problem because I was spending more time acquiring debt and less on acquiring customers.
  • Celebrate your customers, team, community and revenue as success metrics. You can extend your runway with customer revenue, which is much better than an investor check.

 

Dawn Dickson will be the keynote speaker at The Women’s Small Business Accelerator’s Annual Gala on Thursday, Sept. 27, at The Estate at New Albany. To learn more, contact Erika Gable at [email protected].

 

Dawn Dickson is the founder and CEO of PopCom Inc., the automated retail technology company behind PopCom Kiosks and the PopCom API. Dawn’s latest company was founded in 2012 as Solutions Vending Inc., after she struggled to find vending machines that could sell her roll-up flat products at high-traffic areas like airports. Dawn also missed the data she relied on to track and monitor traffic and conversion rates through her website.