What is a Fundraising Story?
Fundraising is storytelling. Anyone who’s tried to raise a dollar knows this. But what does that actually mean? How do you create a fundraising story?
Fundraising is storytelling. Anyone who’s tried to raise a dollar knows this.
But what does it mean to create a fundraising story? We know we want our investors to feel something. We know we want some sort of problem-solution structure.
But how do we pull together a story that actually moves someone to put their money in our businesses?
One definition of story is “an account of events in the evolution of something.”
The key word here is evolution. Something changes as a result of the story, and most importantly, something changes in the viewer.
What is the evolution we’re looking for in our investment pitch?
The evolution of skeptical investor into an excited investor, by evolving/changing their understanding of the world and what's possible. It’s the creation of a desire for the future you’re trying to build.
If your pitch helps an investor check these 3 boxes, there’s a good chance they’ll give you money. The investor:
1. Sees the world you’re trying to build
2. Believes that world is one that is worth having and will drive financial results
3. Believes you can actually build that world
Let’s dive into each of these points.
An investor needs to see the world you’re trying to build.
You need to have a vision for the world that’s different than today, because that delta is where value is created and money is made.
That vision can be huge, like saving the planet, or more simple, like introducing a better mixed cocktail to the market. The exact vision doesn’t matter, what does matter is clarity in vision and communication of that vision, and a clear connection to how your product brings that vision to fruition.
Saying you want to save the world from climate change by introducing a new social shopping app isn’t going to get you investment. Those two points are so radically separate.
But if you want to change the way people discover new products by introducing a new social shopping app, you have a chance of getting that money.
An investor needs to believe that world is worth having and has potential for financial return
Someone will invest in your company if they see your vision and they believe in it. They think what you’re trying to do is something that’s worth doing, from a societal and economic standpoint.
Maybe they agree that the current shopping experience is broken, or that climate change is the number one problem to address in the world.
Sometimes investors will come in with a pre-defined belief. Other times we can help investors see why this is a world worth having through our story.
But if they believe the future you’re trying to create is worth creating, then they’ll have a desire to give you money to make it a reality.
In all situations, we also need to include some indication as to how this new world means money for you and for them. Sometimes that will be obvious, and sometimes you need to get more explicit, especially when you exist in a market your investor may not know much about.
An investor needs to believe you can build this world
If an investor understands what you’re trying to build and believes that it’s worth building, the final step is to convince them that you can actually build this world.
You can have the most exciting vision in the world, but if you can’t bring it to life, it’s nothing more than a dream.
In your investment story, you want to include the most powerful proof points that you can bring this to life. That means traction, team experience and capabilities, advisors, support34w, intellectual property, and more.
Bringing it home
If your story accomplishes these three goals - presenting the world you want to build, persuading an investor it’s a world worth having, and convincing them you can build it - you are well on your way to a fresh check from an investor.
The ways you can achieve these goals are infinite, there is no one form this story needs to take.
If you need support and guidance putting this story together, we’re here to help.