Common Mistakes Why You Fail To Raise Money (And What Can You Do About It)

Every two weeks one Techstars Startup Weekend event postpones or cancels due to the lack of funding. Many events in different regions face the challenge of attracting sponsorships. Here are the most common mistakes:

1) Setting A High Budget

SOLUTION: If you are planning to raise $10K, ask yourself, can you revise your plan to accomplish the same with $7K? Most of the time, organizers ask for arbitrary round numbers like $10K or $15K instead of the actual amount of money needed to achieve specific milestones.

Think about what can you cut. Work to re-budget. Spend a little bit less on marketing. Cancel your fancy T-shirt and video producing.

Be creative how you can spend the money productively. Spend time polishing your budget forecast, so that you can confidently tell sponsors why you are only looking for $7K, and why you know you can achieve high quality with less capital.

2) Not Having The Sponsorships Mentality  

SOLUTION: Put yourself in the sponsors shoes, try to understand what the company actually needs (Job To Be Done) by supporting your event. Are they looking for marketing exposure, engaging with entrepreneurs,  hiring people etc.

Raising sponsorships will take more meetings, and more time with every company, especially for first time events. Be prepared, and ask what the steps are, how long the process will take, and what to expect.

Also, be aware that many sponsors will pass, so it is essential to have of list of more companies to approach, this doesn’t mean you need to talk to every company out there. You can only get sponsorship from a qualified company— who is interested in your space and has the resources required.

Check out our Techstars Startup Weekend Sponsorship Deck

3) Relying on Cash Sponsorship Only

SOLUTION: There is a real possibility that you won’t be able to raise any sponsorship from companies or will raise a lot less than you expected

When your fundraising is not going well, it is time to pause and rethink your strategy, try to come back to sponsor with alternative options to provide in-kind sponsorship or provide the food to the event in return of sponsoring (many companies have discounts with food providers so what would cost you $3,000 can cost them $2,000) in this way you can get what you want with less money for them. Win-win.

In addition, It’s important to differentiate between partners vs. sponsors. By changing the language to partners vs. sponsors it makes them feel more connected to the success of the event. A sponsor writes a check, a partner is more likely to contribute human and financial capital

Reach out to some partners with this example in mind “We understand that you’re not in a place to be a cash sponsor, but would you be interested in offering 5 hours of your company’s services to the winning team as part of the prize package. Engaging with your law firm would really help the top team(s) continue their momentum beyond the weekend. By being  partner we’ll happily give you exposure on our website and during the event.

The important thing is to have a clear plan. What can you do with no or little capital? Come up with a plan, discuss it, get feedback, and then go back and execute on it.

4) Failed To Follow-up With Sponsors

SOLUTION: Decision-Making process will take a lot of time for the company to decide whether to sponsor or not. Therefore, if you can, find out how far in advance that company prefers to be pitched. At the very least, allow for a four to six month for the arrangements to be made.

Give the company some time to check your offer and if you didn’t hear back after a 7-10 business days, maybe you should follow-up. Most follow-ups are better than no follow-up at all but keep it short and straightforward especially if you’re on third and final follow-up. There’s a fine line between persistent and annoying. If you haven’t received a response at this point, it’s probably best to move on to another opportunity.

5) Not Setting The Right Ticket Price

SOLUTION: Selling tickets will not only support you with extra cash, but it’s also liberating. When you sell tickets, you no longer depend so much on sponsorship. Events that start selling tickets are more attractive to sponsors, it is less risky, and it is clear that organizing team is very responsible.

The key here is to set good ticket pricing, chances are, your attendees have some events to choose from—so how much do their other options cost? Check out your local listings to see what else is happening in your area around the time of your event and research past ticket prices for similar events. Put yourself in event-goers shoes, and ask how your headliner, your venue, or your host city measure up to the competition.  

6) Failing To Understand The Customers Needs

SOLUTION: Before organizing an event, you must spend more time interviewing their customers (attendees) and understand their needs to attend the event. This can help you decide on the event themes, number of attendees expected, prizes, etc.

Another thought if you already start the planning to host a pre-event bootcamp, this is will give you the opportunity to meet your customer and market your event.

How to Build a Collaborative Startup Community

Building a collaborative startup community is not easy; there is no specific rule you can set. It is a community ideology, mindset, and shared dreams between all of its players. But where do you start? What is important? Here are three important things you should keep in mind.

Build a Shared Purpose  

Communities must be innovation platforms; players seek a basis for trust and organizational cohesion. The sociologist Max Weber famously outlined four basis for social relations, which can be roughly summarized as tradition, self-interest, affection and shared purpose.

This shared goal is not an expression about what we create individually, but about the overall value we can orchestrate through collaboration with our broader ecosystem, which we’ll always be able to count on, because of its flexibility and fertility for growth and innovation.

The process of achieving a purpose is rarely simple and straightforward; startup communities must move through several distinct phases.

They should engage all the players and allows them to meet regularly to share ideas and discover common ground. They should also create contexts in which people can begin to imagine, and act, from a new sense of possibility to find new and better ways to work together.

You can start with analyzing the situation and determining the key issues involved. It moves on to a definition of the fundamental mission or desired outcome. Everyone then articulates a common vision and works out a plan and a timetable for meeting their goals. In most cases, the process concludes with an assessment of the outcomes and a review of lessons learned.

Some ideas to foster collaboration:

1) Build A Startup Ecosystem Canvas:

Developed by the Founder Institute, the canvas seeks to provide the local entrepreneurs a clear list of resources for every stage of their startup journey. Also, the canvas can be a shared understanding of what the ecosystem actually is, and allows everyone to have a good perspective for both community builders and startups on the local ecosystem to exploit existing chances and at the same time identify missing links.

2) Startup Week Event:

Startup Week is a celebration of entrepreneurial events in cities over five days where participants can choose the events they’d like to attend that are held at various venues across a town. By having more organizations and communities participating, you can have the ability to link people, ideas, and resources that wouldn’t normally bump into one another, and help creating a unique density around your community’s unique entrepreneurial identity.

Create a Culture of Collaboration

The hardest challenge for any startup community that wants to turn into an open, and collaborated network, is to develop and grow the culture of collaboration. To make this work, startup communities must be inclusive. This means being genuinely open to everyone who wants to engage in the community irrespective of who they are or where they originate from. This also means believing in collaboration as a fundamental part of building the ecosystem to guide the community towards that collective fulfillment for continued growth, which in turn will enable the essential collaboration endeavor.

The first place to start with is your organization/community. Try to think in ‘win-win’ terms rather than seeing interests in conflict with other players, devote many of your resources to attain full collaboration, and relentlessly communicate the need to make enhanced collaboration a success. By doing so, you set an example through your behavior in the way you collaborate to direct the community toward more collaboration.

Empower Entrepreneurs Leadership

Collaborative communities cannot get off the ground without a core group of entrepreneur leaders who foster the collaboration, establish the vision and community values, and attract more people to the ecosystem. That does not mean top-down authority structures, titles or specific roles, it’s more like evolving with a group that provides the social capital and infrastructure that other participants can build on.

Since the leaders are entrepreneurs, they can identify the problem and conduct continuous evaluation of the community.   

Having the entrepreneurs lead is essential to building a sustainable startup community. In every startup ecosystem, lots of different organizations and individuals get involved and play a significant role, include governments, investors, mentors, universities, big business, etc. Although their involvements are essential, they can’t be the leaders of their local startup community. They must be feeders.

In his book, Startup Communities: Building an Entrepreneurial Ecosystem in Your City, author Brad Feld pointed out what it takes to create a community of entrepreneurs in any city.

“Leaders of startup communities have to be entrepreneurs. Everyone else is a feeder into the startup community. Both leaders and feeders are important, but their roles are different.”

To more empower and connect their cities to the wider world, entrepreneurs leaders develop contacts not only in their local hubs but also beyond them. By taking action, they provide authority for others to become leaders.

This was originally published here.

Report: The Status of Entrepreneurship in Syria Under the Conflict

Entrepreneurship in Conflict Zones: the first report offering insight into the status-quo of entrepreneurship in Syria during conflict

To sum up the results of five years of work to build an effective entrepreneurial ecosystem in Syria, I have put together data from a study examining and researching hundreds of Syrian entrepreneurs and experts.

The report draws on data from a study examining the views and experiences over a period of twelve months of research, during which 268 interviews were conducted with Syrians entrepreneurs. The study also included an open discussion and series of interviews with entrepreneurs experts as well as insights from local startups.  

Prior to the conflict, few steps had been taken to assist the Syrian entrepreneurial ecosystem, which had real potential for growth. However, after 2011, startups have faced numerous challenges that restricted that potential.

The protracted war in Syria has exacerbated the challenges facing entrepreneurs working to create their startups. These challenges include: insecurity and political instability, scarcity of financial support, access to market limitation, collapsing infrastructure, sanctions, and payment restrictions, increasing economic burdens, dwindling human skills, diminishing of the market size, unfriendly regulatory environment, and a dysfunctional entrepreneurship education.

Since 2013, a slight recovery in terms of startups supporting new ideas and seed-focused entrepreneurs has taken place, led by a new generation of the community. Currently, there are more than 30 community entrepreneurial events, and many organizations are actively working to support Syrian entrepreneurs.

The study also shows significant improvement in the contributions of female entrepreneurs, which make up 22.4 percent as a natural outcome of the new role played by many women as chief breadwinners of the family, while many of the men have been forced to either flee or engage in the armed conflict.

Additionally, the report offers alternatives and solutions that could be considered in trying to overcome the obstacles posed by this lingering conflict and recommends that multiple players inside and outside the country contribute to improving entrepreneurs’ positions, as everyone has a role to play in this process.

The key message of this study is that policymakers and startup communities should start to consider assisting entrepreneurs in their endeavors to create businesses that take into consideration the public benefit. With proper upfront support and policies that are fair and available to everyone, entrepreneurs can yield substantial social and economic dividends.

To dig deeper, read the full study here >>