Last month, NJII’s entrepreneurship team hosted an engaging virtual learning session as part of the New Jersey Innovation Fellows (NJIF) program, bringing together 30 first-time entrepreneurs to dive into the intricacies of fundraising. Moderated by MJ Durkin, NJII’s Director of Entrepreneurship, and featuring an accomplished panel of speakers, the session offered valuable insights into both the art and science of raising funds.
NJIF, a New Jersey Economic Development Authority (NJEDA) program, supports entrepreneurs who have unique startup ideas with access to mentorship and income replacement grants. NJII’s entrepreneurship division provides mentorship programming to the companies participating in the program, in partnership with Rowan University.
Insights from Experienced Founders
The session featured a powerhouse panel of experts who shared their diverse experiences:
- Viraj Mane, Director of the NJII Venture Studio and co-founder of Lactiga, shared his journey in securing $2 million in venture capital and over $500K in non-dilutive funding.
- Sloane Tilley, CEO and co-founder of DIA, provided insights into raising capital as a first-time founder, highlighting her experience securing $3.25 million in non-dilutive grants from the Department of Defense.
- Amos Winbush, CEO of bckers and a seasoned entrepreneur, discussed the evolution of fundraising instruments and the strategic considerations founders must weigh.
- William Reichert, Proposal Writer, Grants and Restricted Funds at NJII, an expert in grants writing, provided actionable advice on finding and applying for grant opportunities effectively.
Key Takeaways: Mastering the Fundamentals of Fundraising
Participants left the session equipped with a clear understanding of the fundraising landscape, from grants to equity investments. Some of the essential learning points included:
Fundraising Fundamentals:
Startups need a solid foundation of traction, a validated product, and a clear understanding of funding options. Panelists emphasized the difference between dilutive funding (e.g., venture capital) and non-dilutive funding (e.g., grants) and stressed the importance of understanding market conditions.
Grant Writing Tips:
William Reichert provided a wealth of insight on crafting successful grant applications. He emphasized the importance of paying attention to detail, including accurate and complete documentation and adherence to deadlines. Budgeting was another critical focus—Reichert explained that a clear, justified budget can make or break an application, as grantors scrutinize how the funds will be used. Finally, he reminded founders that grants are highly competitive, and winning a grant requires a compelling narrative that clearly articulates the problem, solution, and potential impact.
Preparation for Due Diligence:
Viraj Mane offered invaluable guidance on navigating the due diligence process, a critical phase of fundraising where investors closely evaluate a company’s readiness and potential. He stressed the importance of organizing key documents, such as financial statements, legal agreements, and intellectual property records, to instill confidence in potential investors. Mane also recommended using data rooms—secure online repositories for sensitive documents—to streamline the sharing and review process. Beyond preparation, he emphasized the importance of responsiveness, noting that founders who are quick and thorough in addressing investor questions are more likely to build trust. Mane’s advice underscored that due diligence is not just about document compliance but also an opportunity to demonstrate professionalism and readiness for investment.
Fundraising Strategies & Choosing the Right Investors:
Panelists shared their experiences, such as securing millions in both dilutive and non-dilutive funding, and stressed the importance of market knowledge and having a clear plan for capital utilization. Sloane Tilley and Amos Winbush discussed their strategies for determining the appropriate amount of capital to raise, emphasizing the importance of understanding the market, having a clear plan for the funds, and building relationships with investors. They also highlighted the importance of finding investors who align with the company’s mission and vision, and the need for mutual respect and understanding in the investor-founder relationship.
Closing Thoughts
The session concluded with an open Q&A, where participants had the chance to seek personalized advice from the panel. The discussions were both practical and inspiring, leaving attendees with a roadmap to navigate the complex world of fundraising.
As NJIF participants continue their entrepreneurial journeys, sessions like these provide critical support, equipping founders with the tools and knowledge to transform their innovative ideas into thriving businesses.
Stay tuned for more updates on NJIF and future learning opportunities. If you want to learn more about the services NJII’s Entrepreneurship Division offers, check out our webpage.