Everything feels possible when you’re starting up a new business. You have a great idea, trusted co-founders, and everyone is cheering you on. Slowing down to make sure all the legal documents are signed and sorted can feel like an unwelcome delay, but it’s a vital part of making sure you, your co-founders and your business are protected for the future.  

The principal benefit of having an early-stage fund in your capitalisation table is that it can help your startup to raise investment. An early-stage fund investor represents an important vote of confidence in your business. It tells other potential investors that your early-stage startup has been successfully vetted and qualified by a specialised fund. This encourages both existing and potential equity holders to invest more because they perceive less risk. 

Having a long-running technical position in your start-up might sound like something that’s only necessary for more established companies. Why hire a member of staff when you can outsource software development? In reality, there’s much more to start-up tech roles than just coding. The right person will provide a range of essential skills that will grow and evolve alongside your company. 

Investment is important to the founder of an early-stage startup because it pays for the team, the infrastructure, and the prototypes that are needed for them to grow. To a business angel, early-stage investment is important because it allows them to obtain a significant equity stake at a low valuation. This gives them the ability to influence the direction of the startup and by extension the outcome of their investment.

Building a business around monthly recurring revenue (MRR) makes growth more predictable, and provides investors with a useful metric for understanding trends in profitability and cash flow. This makes the MRR business model popular with technology startups that offer software as a service (SaaS). 

OTIV is a dynamic new addition to the Pitchdrive community. This smart start-up is looking to revolutionise on-rail transport in complex environments like cities and busy industrial areas by using autonomous technology to improve safety and efficiency. 

At Pitchdrive, we know there are great founders everywhere. Some of the hardest working teams with the best ideas can be found outside traditional start-up hubs like London, New York and San Francisco.  

Seed investment took a hit during the Covid 19 pandemic, with business angels and venture capital funds (VCs) electing to put more of their capital into late-stage startups such as unicorns with valuations over $1 billion, according to Crunchbase.

As the pandemic recedes, it is becoming clear how profoundly Covid has accelerated digitalisation across the global economy. Covid has created an ideal environment for fintech companies to grow exponentially and deliver strategic valuations for their investors.