From Accelerator to Venture Fund: What Startups and Investors Need to Know
For the past eight years, I’ve been running an accelerator, and this past year, I started raising a $2.5M venture fund to support startups in our community. Along the way, I’ve learned a lot about the gap between startups and investors. Both sides often don’t fully understand what the other needs. This disconnect can make it harder to build strong partnerships.
I want to share some of the key lessons I’ve learned about these two worlds. I will explain how they can come together better.
For Startups: Build Trust by Being Prepared
One thing I’ve noticed is that many startups don’t realize how much work it takes to raise money. If you want investors to trust you with their capital, you need to prove that your business is valuable. Demonstrate why it is worth the risk.
Here are a few basics that startups need to get right:
- Financials : Your numbers should be clear, accurate, and well-organized.
- Legal documents : All the paperwork for your business should be in order.
Getting these things ready takes time, effort, and sometimes your own money. But it’s necessary. Investors have other options where they can put their money with less risk and still see decent returns. Your business needs to stand out as a great opportunity, not just a good one.
For Investors: Combine Instinct with Strategy
On the flip side, I’ve seen many investors rely too much on gut feelings. They often base decisions on how much they like the founding team. While it’s important to trust the people you’re backing, investing isn’t just about emotions.
Good investors:
- Set realistic expectations about returns and timelines.
- Build a diverse portfolio to spread risk across multiple startups.
Investing in early-stage startups is tricky. You don’t always have all the information, and it takes experience to analyze what’s there. Startups also expect investors to offer more than money—they want connections, advice, and support. This is where some investors get overwhelmed, as working closely with startups takes a lot of time and energy.
Why I Started a Venture Fund
After working with over 300 startups, I’ve learned what makes a startup team ready for growth. I’ve also discovered what makes a good business that isn’t necessarily investable.
That’s why I started this venture fund. I’ve been through the ups and downs of building a company, and I understand the challenges startups face. I also know what investors need. They need trust that their money will be used wisely. They also need a partner who can guide startups through the tough parts of the journey.
Investing, especially at the pre-seed stage, can feel risky. But with the right support and strategy, it can be rewarding for both sides.
Looking Ahead to 2025
This is my last blog of the year about investing. Over the next two weeks, I’m dedicating time to talk to both startups and investors. I want to hear your stories. I want to share what I’ve learned. Let’s discuss how we can grow Canada’s tech ecosystem in 2025.
If you’re a startup founder or an aspiring investor, I’d love to chat. Here’s my calendar link to book a call. Let’s wrap up the year with meaningful conversations and build something amazing together.
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