Fundraising is an ever-evolving landscape, so each month, we speak with a seasoned investor to bring founders up-to-the-moment insights and tactical advice for their next fundraise.
In this episode of Fundraising Today, Mercury’s Head of Community, Mallory Contois spoke to Nikunj Kothari, angel investor and product lead at Meter. Here, he shares insights on the current fundraising environment and advice for early-stage founders looking to raise.
Click play to watch their discussion or read the key takeaways below.
1. The current environment is challenging. The fundraising environment, whether from angel investors or established funds, is currently challenging due to macroeconomic factors like rising interest rates, inflation, and geopolitical uncertainties. It's been a roller coaster for founders.
2. Investors are looking for a few key traits. To attract investors, focus on having a strong team with unique insights, a clear value proposition, a large addressable market, and a defensible competitive advantage.
3. Certain sectors are gaining momentum. AI/ML, healthcare, climate tech, defense, and cybersecurity are experiencing favorable tailwinds. On the other hand, consumer and crypto sectors have seen a lack of momentum due to market downturns.
4. Aim to solve multiple problems. Startups that can consolidate multiple solutions to help companies save time and money are gaining attention, regardless of the sector they operate in.
5. Founders raising now should remember these fundamentals:
- Clearly articulate your startup's story.
- Be realistic about valuation and avoid requesting unrealistic valuations.
- Focus your efforts on building your company; growth is key.
- Leverage angel investors for advice and introductions; even small checks can lead to significant support and guidance.
6. Tap into the expertise of angel investors. To find the right angel investors, consider directories, but also be strategic. Look for angel investors with experience in your specific industry or area of focus. Building relationships and seeking advice can often lead to investment opportunities.
Undoubtedly, the fundraising environment is challenging, however, founders can attract investments by focusing on key traits, staying realistic, and partnering with angel investors strategically — particularly those with deep industry experience.
You can reach out to Nikunj through his active Twitter account (@Nikunj) or via email at [email protected].