Landing eCommerce funding is one of the most important things you can do for your online retail business. Yet so many eCommerce brands shy away from securing an outside funding source. Why? It could be due to the overwhelming number of investors and venture capital firms available, or simply that you have no idea where to even begin searching for an investor.
3 Tips to Secure eCommerce Funding
Small, temporary funding solutions are great for getting your eCommerce business off the ground, but don’t expect those funds to sustain you for the long haul. In order to keep growing and expanding your brand, you need to establish and foster relationships with VC partners looking to invest in long term eCommerce growth.
If you’re new to securing eCommerce funding, the process of finding a VC or funding firm feels intimidating. But it doesn’t have to be. Carefully researching and preparing for VC meetings can help you get ahead of the process:
- Make sure your long-term goals are aligned. You want to create a lasting, vibrant relationship, not one that will burn out in a few months. The first thing you need to do is ensure that funders’ goals align with your brand. If you don’t have common objectives, move on to the next candidate. You should feel 100 percent certain the VC firm you’re working with is the best fit for you.
- Take a look at funders’ industry experience. You want investors who know what they’re doing, not amateurs who are new to the eCommerce scene. As part of the discovery process, ask to see a portfolio of clients working with the firm. A strong portfolio that demonstrates measurable results in a certain industry is another tick in the “yes” column of why you should work with that particular funder.
- Don’t be afraid to ask about past clients and former relationships. You should put as much emphasis on learning about past clients as you would current clients. It’s important to understand why investor-investee relationships came to an end. Was there a mutual agreement to terminate? Or was there a deeper disagreement that led to the relationships dissolving? You can make a fully informed decision about working with investors once you’ve learned more about previous clients.
Lock in Your eCommerce Funding Source Today
Need a comprehensive how-to guide for securing eCommerce funding? Dotcom Distribution has you covered. Our latest eBook, “Emerging in eCommerce: A 360º Degree View From The Inside,” walks you through best practices for securing rounds of VC funding. From the first round of introductions to final handshakes, you’ll learn what it takes to make relationships with investors last.
To learn more about Dotcom Distribution, contact us today.