"There are always going to be people who will engage with different deals at different stages, no matter what the market cycle is doing," says VentureCrowd founder and CEO Steve Maarbani.
While the trope that capital markets have been depressed is certainly true, one of Australia's leading experts in securing funding for startups is optimistic about the prospects for founders who play their cards right and capitalise on the opportunities of the digital age.
VentureCrowd founder and CEO Steve Maarbani, who is a former PwC venture capital partner with experience in the space since 1998, will be showing founders how to raise capital faster and more flexibly than ever before in his presentation at the intimate E2E Summit to be held on 16-17 February at the ivy in Sydney.
"Because of the way venture capital and angel investment markets have digitised over the last five years or so, as companies go into capital raising in 2023 and beyond they will have a range of options available to them that are greater than ever before," Maarbani tells Business News Australia.
At the event Maarbani will give an overview of how to formulate capital raising strategies and assess the wide range of options at your disposal, from angel groups to accelerators, government grants to venture capital firms, and more.
"The way we raise capital can determine the success or failure of a new business idea with high-growth potential. But who wins and who loses has little to do with being a good company but rather who plays the capital raising game most effectively," he explains.
"The suggestion that ‘good companies will always get funded’ is a bit of a myth. History is littered with examples of great companies that were rejected by smart investors and have gone on to become global powerhouses generating hundreds of millions in revenue, employing thousands of people all over the world and delivering value for shareholders in the billions.
"The availability of early-stage capital, together with the efficient and effective deployment of that capital across the entire life cycle of a high-growth company, has the potential to shift innovation and entrepreneurship into overdrive."
Crafting the right capital raising narrative for maximum effect
He emphasises crafting the optimal capital raising narrative and has decades of background in putting together appropriate templates tailoring to a startup's circumstances and their target investors.
"In order to pitch to venture capital firms you need to understand what their mandate is, what stage of the process they will invest in, what cheque size they like, what sectors they like, what thematics they specifically like, and then you need to target them," Maarbani says.
"If you don’t have that information it’ll be very difficult to get a useful outcome."
He says for a long time private capital markets have been anything but efficient - fragmented and lacking transparency as a closed and elite club.
"As a result, a huge number of potential investors around the world with both willingness and investable capital, could not participate, which has meant the available innovation capital pool has always been materially less than actual supply levels," he says.
"This dynamic artificially restricts the size of the early-stage capital markets, and makes capital raising unnecessarily harder for founders than it would be if the market forces of supply and demand were operating properly."
Nonetheless, the increasing digitisation of the venture capital sector is changing this dynamic, bringing founders closer to angel investors with varying levels of sophistication, from retail investors all the way through to the CEOs of major companies and former founders who have exited their businesses for hundreds of millions of dollars.
"Whilst that demand was once available, the access to these companies has never been available in the way that it is now," Maarbani says.
The executive recognises he has a horse in the equity crowdfunding race, but explains it is yet another channel that founders can utilise. He especially emboldened by its success in the UK, which he feels is about four years ahead of Australia.
"In the UK last year, over a a third of all venture capital funding went through one of the two digital venture capital platforms, and that is Seedrs and CrowdCube. That is extraordinary," Maarbani says.
"Our crowdfunding legislation is very much a mirror of what happened in the UK, so during the consultation process it was the sister jurisdictions that were as close as possible to the way the Australian regulator likes to operate that they moulded the legislation on.
"If Australia is likely to follow the UK, and we believe that it will, within a few more years a significant amount of money will be raised by companies completely digitally," he says, clarifying his belief that crowdfunding is not competing with other capital raising methods but is rather an additional option.
Maarbani is a passionate proponent of entrepreneurship and innovation, and how helping founders access capital can work towards solving some of the world's most complicated problems.
"I want to leave a legacy that says, 'we've made a contribution to making the world a better place'. And that’s how we think we can do it," he says.
This is just a morsel of what Maarbani will discuss in his E2E session and the questions he will be able to field. In summary, the session will explore:
How to raise capital in 2023: everything you need to know to plan your next capital raise;
How to develop your capital raising strategy & capital raising narrative; and
An overview on deal structure and terms.
So what are you waiting for? Click here to join us at this two-day summit where Maarbani will be one of many amazing founders giving his insights to help rocket your business forward in 2023 and beyond.
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