TL;DR

Designing a capital raising framework for early-stage ventures across pre-seed, seed, and Series A stages to help them approach the daunting task by enhancing their capital raising capabilities

​

PROJECT SPONSOR

Queensland University of Technology - Australian Centre for Entrepreneurship Research - led by Timothy Hor Former CEO and founder with extensive experience in raising capital and building businesses in the Asia Pacific region.

ADDRESSING THE CHALLENGE
Over 90% of startups fail to raise capital successfully, with poor investability and timing being key factors. While debate continues over the exact figures, they underscore a reality that founders cannot afford to ignore - raising capital requires careful assessment of readiness, strategic clarity, and process execution.

 

The key question facing founders is not only how to assess and execute capital raising effectively but whether they should raise venture capital in the first place!

 

The goal of this framework, emerging from doctoral research and extensive practitioner experience, is to provide an assessment framework that assesses a startup's fundraising readiness and guides the process.

​​

BUILD AN ASSESSMENT FRAMEWORK FOR ASSESSING CAPITAL RAISING READINESS

The framework is built on three key artifacts grounded in design science research. First, three Design Principles comprising Strategic Clarity, Investment Readiness, and Process Savviness guide the overall approach.

 

• Strategic Clarity brings focus to the fundamental aspects of fundraising preparation. It helps founders align their business goals and strategic mindset with their fundraising objectives. Through this lens, entrepreneurs can realistically assess their capital needs, ensure alignment with current stakeholders' expectations, and fully understand the implications of exchanging equity for capital.

• Investment Readiness evaluates the critical elements that make a venture investment-worthy. This dimension examines market size and growth potential, assesses team capabilities and organizational structure, measures product/market fit through concrete metrics, evaluates business model scalability, and analyzes financial health and projections.

• Process Savviness provides guidance for the actual execution of fundraising. This pillar helps founders organize and leverage their networks effectively, develop and implement investor engagement strategies, establish legitimacy in the market, execute their pitch process, and navigate term sheet negotiations successfully.

​

Second, a Process Model structures the fundraising journey through three iterative phases: Triggering for clarifying strategic clarity and discerning investment readiness, networking-engaging-pitching for networking, engaging, and establishing legitimacy and negotiating-closing for negotiating term sheets and due diligence with investors.