Finding money to fund one's endeavor--a topic close to entrepreneurs' hearts and blogged about almost incessantly. This is our experience, and please tell us about yours.
Fortunately, we have enough savings to bootstrap; which is not to say that we don't need extra investment, or that we didn't have to slash features to arrive at a realistic "can-launch" plan.
Knowing full well that we're still seed-stage, and that logically seed-stage companies normally don't attract many investors, plus being apprehensive of giving away too much equity at this point, we targeted the following, in descending order of priority:
- Government-type no-strings-attached grants: If they like us, they'll fund us; very few questions asked. Problem is, "like" is loosely-defined and infinitely-opaque here.
- Angel funding: Hallelujah!
- VCs: Epitome of the business world--no customers, no money. Well, that's a silly assertion I suppose, like saying fish don't swim without water.
Singapore has many initiatives to provide funding through government agencies. There has been a lot said about the pitfalls of such funding: lengthy, opaque application process (typical picture of government bureaucracy), non-consistent decision-making by non-committal stake-holders (mostly panelists from industry who aren't really responsible for the $$ they dish out), etc. Paul Graham wrote several insightful articles on the topic, as have many bloggers. TheFunded.com also covers many aspects of funding in general.
The first one we applied for was TECS. Spring Singapore provides a variety of schemes to finance budding entrepreneurs. We didn't get the money, and didn't particularly enjoy the whole experience because:
- We waited 6 months for the entire process: application, business plan, presentation. Thankfully, the results were announced quickly.
- There was little transparency--our questions to people other than the facilitators were never answered, although we, being the sellers, were naturally very responsive.
- There was _no_ feedback on why we didn't make the cut.
Perhaps if we had gotten the money, I won't be complaining that much ; )
Now we understand why things are the way they are at Spring Singapore, and we sincerely hope for improvements.
On the bright side of things, the process itself was great, because:
- It really helped us put our business plan together, especially the balance sheet forecast and the costs breakdown.
- Nothing beats the real-world experience of pitching, albeit to the government. Wearing a suit in Singapore is a killer replacement for hot yoga.
- Now we can share some good information with fellow entrepreneurs.
Would we apply again? Of course! One rejection motivates us even more, so watch this space : )
Good luck to all funding-seekers out there! We'd love to hear from you.