Funding for Startups: 10 Issues Raised That Hinder Rather Than Help Them
W e decided to take a straw poll from a range of startups on the sources of startup funding and the merits of training, what is out there, the difference in quality of service available. Here are the observations and experiences of the startup owners. They were more willing to share their thoughts with us anonymously rather than with the agencies they worked with for fear of upsetting the people within them.

The overriding impression is that some startup funders/incubators can hinder the development of a startup rather than help.

How?

Following is a list of the top 10 issues raised:

  1. They often insist on the applicant having to attend training or seminars to demonstrate outcomes regardless of whether the startup has experience in their chosen fields
  2. This can divert their already limited resources to investing the time, effort and travel to and from the training instead of focussing on their business
  3. On many an occasion the training on offer is too generic and not suited to the startups individual needs
  4. The training on offer is on occasion sub par and more to do with box ticking than have any real value
  5. The organisations holding the purse strings do not accommodate the disruptive
  6. After fulfilling the requirements of attending the training and seminars the amount awarded is often less than the amount asked for or required
  7. This reduces the capability of the start up to truly start up due to lack of sufficient funds
  8. The effect inevitably hampers the ability of the said start up to succeed
  9. The finance awarded is judged by individuals that have never actually started a business from scratch themselves
  10. The funding available is spread across more startups to boost statistics rather than focussing on adequately funding a smaller number of businesses

Is it time for funding organisations to take a leaf out of the book of the entrepreneur?

Following is the top 10 possible solutions:

  1. Take more risks!
  2. Focus on the objective of the startup and facilitate the business by offering resources to build the business not just financing and generic training or seminars
  3. Employ consultants to use their skills on 1-to-1 business support and practical help
  4. Reduce the impression of hedging the funding of start ups, focus on a smaller cohort
  5. Consider using own staff to work in start ups on secondments
  6. This which would benefit the staff as it would bolster on the job training and experience in different types of businesses
  7. Secondments could turn into permanent roles and pair highly skilled professional with small business owners
  8. Follow up on startups and help with capital investment opportunities for expansion
  9. Consider offering ongoing support, guidance, mentoring and practical assistance with management and recruitment
  10. Finding entrepreneurs that have great ideas is not the issue, supporting them in the most effect way is the real issue

Practical support in the operation of a business is far more beneficial than just funding and irrelevant or sub par training; the startups we spoke to would've welcomed help and support in sales, marketing, lead generation, customer service, and account management as well as process maintenance and overall management. This would've been a more productive use of resources. Isn't it time for such agencies to review their own systems and processes and consider employing less bean counters and employ all rounders that can go to work in a start up or multiple start ups and outsource the bean counting to specialist firms.

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