How To Raise Investment – 10 Top Tips That Secured £40m
How To Raise Investment – 10 Top Tips That Secured £40M
2nd February 2023
We’ve teamed up with our client, Plend, to share their top 10 tips on how to raise investment for a startup.
Plend isn’t just exceptional, they’re inspirational. Their investment journey with us started with a massively successful pre-seed round that became overfunded by £300k, since then they’ve secured a whopping £40m in a seed round that included some extremely high-profile investors, including the founders of digital banking juggernauts Monzo and Starling – and we’ve been with them every step of the way, providing help with raising investment.
It’s been an exciting journey for Plend co-founder Robert Pasco, he now has first-hand knowledge on how to raise investment, so we asked if he’d share it with you.
10 tips from Plend co-founder Robert Pasco on how to raise investment
1. Have a vision and commit to it.
In Plend’s words, “We’re on a mission to personalise credit to make smarter lending decisions.”
Robert, and his co-founder Jamie, didn’t create Plend because ethical lending is a sexy bandwagon to jump onto. On the contrary, Robert experienced being blocked from affordable lending and fell into the trap of excessive credit card debt. This drove him to find a fairer solution for everybody. Plend’s vision to ‘Rebuild the concept of credit and liberate people from a system that doesn’t recognise they exist until they’ve built enough credit for themselves’ isn’t just a veneer; it’s an ethos.
2. Stay on brand.
What are you trying to achieve and how are you going to do it? It’s essential to nail this right at the beginning, to ensure that when the time comes to market your product or service, your messaging stays clear and consistent. “Don’t forget that [the] fundamentals [of your product] can shift and change over time,” Robert adds, “For Plend, there were a lot of mistakes along the way, and the product did fundamentally change, but because we’d defined our core offering we were always able to stay on brand.”
3. It must be more than just ‘a brilliant idea’.
When Robert and Jamie first came to Robot Mascot, they had more than the bones of a brilliant idea. They’d taken the time to develop their idea and give it substance. As a result, they had a well-formed concept and a good idea of their growth strategy. We were then able to quickly flesh out the key strategic details that investors would be looking for and create a concise articulation of the concept, vision, and strategy. By the time they’d presented their pitch, investors knew they were dealing not only with a brilliant concept but a founding team that have the strategic insight to deliver a return on their investment.
4. Raise a ‘Friends and Family’ round
When it comes to raising investment for a business, Robert recommends raising little and often. Robert and Jamie’s first target was a ‘Friends and Family’ round, which helped them launch the PLEND Score prototype. Many founders find this part of the investment journey tricky but if you can first raise a friends and family round it can be a massive kickstart to your confidence as well as your fundraising campaign. If you use this initial investment to prove your concept in a small way, raising your pre-seed is much easier.
5. Give your IP away for free (yes, you heard that right, ‘FREE’!)
After using the money they raised from friends and family to test their assumptions, they made their PLEND Score prototype available to a selection of banks and lenders free of charge to prove that it worked. As Robert told us, on the face of it, giving out your IP for someone to use for free seems like madness. Still, it was the only way they could prove to investors their technology worked, and it eventually led to some invaluable business partnerships which sky-rocketed their business.
6. Make sure you’ve got clear targets before you start.
Over the course of many weeks, Robert and Jamie granulated their idea down to its core and set themselves a series of quarterly targets to achieve for a full year. Demonstrating they’d achieved the targets made it easier to raise angel investment.
Jan – Mar 2021 – Plend received backing from Nationwide Building Society and began a lending partnership with Purple Shoots.
Apr – Jun 2021 – Plend applied for Financial Conduct Authority (FCA) Authorisation and was certified as a Responsible Lender by Responsible Finance.
Jul – Sep 2021 – Plend closed its £700k pre-seed round and entered into lending partnerships with Lendology and Robert Owen Community Bank.
Oct – Dec 2021 – Nationwide provided data to support the PLEND Score, and Plend began embedded lending partnerships with Switchd and Onlander and signed affiliate channels with ClearScore and Totally Money.
Jan – Mar 2022 – Plend closed a debt round across eight debt facilities from US and European banks, received FCA Authorisation, and had their B Corporation status confirmed.
As you can see, each quarter saw a different set of goals accomplished. There were times when Robert and Jamie had to modify those goals along the way, but they probably wouldn’t have achieved as much as they did without clear targets and those quarterly benchmarks to focus on.
7. Work with the best.
“It’s important to work with amazing partners,” Robert says, “In Plend’s case that’s included Nationwide, Barclays, Fair4all, Fair By Design, and also becoming a member of Responsible Finance. From Day One, our first hire was a marketing genius who helped us build fantastic relationships with institutions across the UK and really positioned Plend as an ethical brand.”
Getting investment-raising support from Robot Mascot, a global award-winning investment-raising consultancy, also helped them articulate their proposition for investors, and overachieve on the capital they raised so they could execute their growth plan quicker.
8. Build the perfect team.
When Robert and Jamie were considering how to raise investment, they knew that assembling a highly experienced, like-minded team early on was going to be immensely important. “Having experts in our team who can galvanise the investors was essential,” Robert says, “We met a lot of people and chose the experts in their field from organisations like Lloyds Bank, Harper Collins, the Commonwealth Bank, Crowdcube, and Deliveroo.”
9. Don’t be afraid to network.
Robert also had to step out of his comfort zone and throw himself into networking. This was an initially uncomfortable move that paid dividends in the long run. “It’s all about going out there, making yourself known, warming the investors up, and bringing them with you on the journey,” Robert advises, “On the back of it, we met Crowdcube’s co-founder and chief marketing officer Luke Lang, who started as an advisor and then became an investor, and another investor ended up being an angel we badgered and sent updates to for four months before the pre-seed.”
10. Ask for advice.
Finally, Robert’s top tip on how to raise investment for a startup is to ask for advice, and not money. Robert discovered that asking for advice instead of asking for money can reap big rewards. He says, “We learned that if you start by asking for advice and then build the relationship from there, there’s a better chance they’ll eventually come on board as an investor. Get advice, build relationships, and then get the money. Not the other way around.”
Help with raising investment
Knowing how to raise investment for a business can be a real challenge. Very few entrepreneurs have previous experience to leverage, plus, competition for capital is fierce. So, it’s little wonder that founders are seeking investment-raising support to give themselves a competitive edge.
As a global-award-winning investment-raising consultancy, we’ve supported more than 3,000 entrepreneurs with how to raise angel investment—and we’d like to help you too.
Our Amazon best-selling book explains how to raise investment. It details the exact blueprint we use with our clients to increase their ability to raise investment by 40x. We’d like to build upon Robert’s brilliant insights by giving you a copy completely free: Claim your free book today
You can learn more about Plend, and their £40m investment round, here.
Get a FREE assessment of your current investment readiness. Our PitchReadyTM Scorecard assesses your current ability to attract investment across three fundamental areas. You’ll even receive a bespoke 12-page report, completely free.
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