One of the most magical moments for any young entrepreneur, or founder, is for someone to give you his or her hard earned money, to support your entrepreneurial journey. When people do that, they actually believe that you will work HARDER than them, and do expect that money to grow faster under your care. In other words, if they work hard and smart to earn that money by putting in 8 hours, you need to do more than 12 hours, because your work rate must be higher than someone who invested in you. If they are sleeping, they expect you to be working for them!
It is a responsibility and absolute commitment to do all necessary to return that confidence, that in Nigeria and broad Africa where capital is limited, someone is supporting your mission. Those your investors have modeled that you are better and more positioned to grow that money than they could do. If not, why should they give you the funds?
The best time to prepare to raise capital is when you may not even be raising money, just as the best time to audition for a great job is when there is none advertised. Simply, raising money at the early stage of a business is about YOU because YOU are the company and the product. Investors get hundreds of pitch decks, but in the ocean of those documents, they are looking for PEOPLE to invest in. Forget the ideas, they want to invest in humans.
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It comes down to integrity, trust and tenacity; I call this ITT Capital, and it is not built in a day or during fundraising. Rather, these are things which are demonstrated over years in transactional forms in dorms, canteens, etc. Can your classmate give you money? Can your colleague at work do the same? Can you auntie invest in your business? If you think they have the resources but refuse, it is possible your ITT Capital is poor before them.
Investing life is made up of two phases – the transactional and relational. The ITT Capital takes care of the transactional part. If you do well therein, you will unlock the relational component which opens opportunity for investment and ideally a long-term relationship with your investor.
And in that relationship, you must keep answering: Who comes first in a moment of truth? The person who gave you money or you? That woman or man or company which believed in you to give money should at all times come before you. If you have that understanding, you will win the future.
Get it from me. People can only give you money if they respect you. An investor can only invest in YOU if they feel they can work with you. Forget your idea or whatever you think you’re building, the real product and company is YOU. If they do not like YOU – the product – they will not buy those shares (yes, invest in your company). To build a great company, you must first build YOU (i.e. yourself) for investors to have confidence to support your journey.
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In summary:
Who am I?
Who do investors say I am?
And when you create a product or service, you go further to ask:
Who do the prospects/customers say I am?
And as the company grows and hires people, you ask:
Who do my employees say I am?
What you get from these four questions, the alignments, misalignments, and contradictions, will tell you what is and is not. The truth is almost always within…