CEO FastServe Anatoly Kavalenka analyzed his experience and answered one of the most important questions: when to attract investment, and why do this at all?
It is important to understand that until you close at least one deal and test the sale at least once, you do not need to take investments. Otherwise, how do you know what money will be spent on? Will you spend it on development? It is cool, but what then? What is the sales cycle? How much money is needed for marketing?
Some have a goal to raise the round, but no idea how to put money to better use. To be honest, we also were in such a situation, and now, looking back 4 months ago, we are pleased that we have not yet raised outside capital. After all, we did not have a sales plan and, apart from developing the application, there were no ideas.
We were lucky to get a piece of wise advice from one of our mentors Alexey Minkevich (Juno Minsk Lab). He asked us: "Why do you need investments? If you possess at least something then you would better sell it." We listened and according to the results of the first few sales and events, we realized how inexperienced we were before when we were actively looking for investments to have money just in case.
Do I really know the complete sales cycle? Do I really know the costs and stages of entering the market? I advise everyone to build a chain: client → discussion → signing → work. This chain should be worked out as much as you can so that each new signing takes less time, because due to the previously collected feedback and a large number of questions from previous buyers, you foresee questions of new buyers, thereby speeding up the process of making a deal. If everything is ok with this stage and the sales skill is perfected, the message you are trying to convey is understandable to everyone and does not raise many questions. If there are sales and bottlenecks are already known then it is time to attract investment and scale.
This does not mean that until the first sales you need to sit at home having to keep out of sight. Attend exhibitions, conferences, collect feedback and communicate with as many investors/mentors and people who are close to your subject. By the time you are ready to attract investments, they will be able to invest in you faster than the rest.