Aside from capital, there are many other inquiries and criteria that startup founders look for in investors. It particularly happens for later-stage startups in Series A, B, and C. This is the finding that DailySocial obtained from a mini survey of some startup founders in the particular stage. We also conduct short polls on this topic on Twitter and LinkedIn.

Why do we narrow it down to Series A, B, and C startups? It is because the startups in this phase have gained traction, secured customer base, and are starting to plan for scale-up or business expansion. It means that they will have more complex criteria along with business growth, and are no longer glued to capital alone.

A different hypothesis might arose as it is compared to the early-stage startups, where capital is necessary to develop products/services. The goal is to get customers and find out whether the product/service has been accepted by the market (market-fit).

The following are the summarized results of our mini survey.

Global investment network

Some startup founders participated in our mini survey, including those engaged in e-logistics, edtech, agritech, and musictech. Apart from capital, their expectations lie down for access to global network (85.7%), technology advisory (42.9%), business advisory (28.6%), and mentoring for founders (14.3 %).

In line with the above statement, as many as 48% have high expectations for access to global investor networks, followed by business advisory (40%), technology advisory (7%), as well as VC brand name and experience (4%)

LinkedIn polling regarding startup expectations towards investors / DailySocial

Polling Twitter mengenai ekspektasi startup mencari investor / DailySocial — Twitter polling regarding startup expectations towards investors / DailySocial

In this survey, Shipper‘s Co-founder, Budi Handoko said that investors already have a lot of experience in managing a business. The role of investors is very important in providing input regarding trends and business models to be explored in the future.

In the context of VC as an investor, eFishery‘s Founder, Gibran Huzaifah added that they can help with the access to global investor network, especially for funding in the next round with a bigger size check.

Track record as the main factor

Next, what are the criteria that respondents looking for in investors? The partners’ track record is at the top of 85.7%, followed by personalities and portfolio ranks with 57.1% respectively, managed funds 42.9%, also portfolio feedback and aligned vision and mission 14.3%.

Budi said, it is important to know the track record and positive feedback of the portfolio before accepting an investment. This is because some investors may act persuasive during the ‘approach’, then turn into controlling moed as they made the investment.

Gibran agreed to the statement, it is important to know how investors work ethic and how they determine the funding hypothesis. These criteria can be the key to considering whether investors and startups can collaborate together.

“Another important consideration is the track record of investors’ managed funds, regarding the fund cycle in what year and the total fund size in particular. This will affect their exit expectations and how strong they can continue in the next funding round,” Gibran said.

For Zenius’ Co-founder, Sabda PS, another equally important criterion is finding investors who have an understanding of how to sustainably create a deep and broad impact. This point becomes very relevant to the extend of the Indonesian education with all the great challenges.

Struggling for investors

All respondents stated that it is difficult to find investors who understand the startup business in certain sectors, the intricacies of the Indonesian market, along with work ethics. According to respondents, it is not easy to find investors with the same value and believe that there are lots of other things besides numbers.

“We believe that good product sells itself. The agreement of time to pocket a return on investment (ROI) is tough if it is forced. This is as long as we prefer to [seek funding] through bootstrapping,” told one respondent.

Gibran added that it was difficult for him to find investors as few people understood the business model he was running in the agritech sector. Due to this condition, he admitted that he had experienced difficulties in convincing investors, especially in appreciating progress. The benchmarks in the agritech sector was not really build then, therefore, it was difficult to find a round size comparison and valuation.

VCs set more focus on managing business growth

Regarding startup funding sources, Venture Capital (VC) is the investor category most chosen by respondents at 71.4%, followed by Corporate Venture Capital/0CVC, private equity, corporations with 28.6% each, and the rest was angel funds at 14.3%.

One respondent said, corporations are considered to be more mature, calm and stable in terms of business. However, there are also respondents who think that VC is more suitable for long-term, lighter, and generic investments.

On the other hand, Gibran believed that VC is more focused on business growth, there is no takeover and strategic collaboration efforts like CVC. In addition, VCs with experience and a strong team can provide insight into strategy, organizational design, and business models.

“From technology support, some VCs provide channels to tech talent and best practices. Some also have internal teams that can support development. As a startup, technology becomes defensibility. VCs who can provide this support will bring a lot of value to the company,” Gibran explained.

Most of our respondents also have a high tendency to seek foreign investors (42.9%), especially investors who have networks or specific interests in more niche industries, such as sustainable innovation. There are also those who are interested in trying to invest through crowdfunding (14.3%).

When you get investors, founders has other expectations include business advisory by 85.7%, then participation for the next round and to be linked to a global investor network of 57.1% respectively, and for investors get into the advisory ranks of 14.3%.

“I don’t think there is a ‘certain type’ of investor that is sought after, it’s rather the person and what is the best funding strategy for the startup. Therefore, it can be a match between goals and long-term relationships as a whole. For example, SME enabler startups will be very strategic to join Sembrani and received investment from BRI Ventures,” Kuassa’s Co-Founder, Grahadea Kusuf said.

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Original article is in Indonesian, translated by Kristin Siagian

Selain dukungan permodalan, ada banyak kebutuhan dan kriteria yang dicari para founder startup pada investor. Hal ini terutama dialami startup tahap lanjut (later stage) di Seri A, B, dan C. Temuan ini diperoleh DailySocial dari survei kecil-kecilan terhadap sejumlah founder startup di tahapan tersebut. Kami juga melakukan polling singkat terkait topik ini di Twitter dan LinkedIn.

Mengapa kami kerucutkan pada startup Seri A, B, dan C? Startup di fase tersebut rata-rata sudah memperoleh traction, mengantongi customer base, dan mulai memikirkan scale up atau ekspansi bisnis. Artinya, kebutuhan mereka semakin kompleks seiring dengan pertumbuhan bisnis, dan tak lagi sebatas pada dukungan permodalan.

Hipotesisnya tentu berbeda jika dibandingkan dengan startup tahap awal (early stage), di mana mereka membutuhkan modal untuk mengembangkan produk/layanan. Tujuannya adalah memperoleh pelanggan dan mengetahui apakah produk/layanannya sudah diterima pasar (market-fit).

Berikut ini hasil survei yang telah kami rangkum.

Jaringan investor global

Sejumlah founder startup berpartisipasi dalam mini survey kami, antara lain yang bergerak di bidang e-logistic, edtech, agritech, dan musictech. Selain permodalan, ekspektasi yang paling banyak mereka cari adalah jaringan investor global (85,7%), pedoman/bimbingan teknologi (42,9%), pedoman/bimbingan kewirausahaan (28,6%), dan pendampingan untuk founder (14,3%).

Senada dengan di atas, sebanyak 48% memiliki ekspektasi besar terhadap akses jaringan investor global, kemudian diikuti dengan bimbingan/pendampingan untuk bisnis (40%), bimbingan/pendampingan untuk teknologi (7%), serta nama VC dan pengalaman (4%)

Polling LinkedIn terkait ekspektasi startup saat mencari investor / DailySocial

Di survei ini, Co-founder Shipper Budi Handoko mengatakan bahwa investor telah memiliki pengalaman banyak dalam mengelola bisnis. Peran investor sangat penting untuk memberikan masukan terkait tren dan model bisnis yang dapat dieksplorasi di masa depan.

Dalam konteks VC sebagai investor, Founder eFishery Gibran Huzaifah menambahkan bahwa mereka dapat membantu menghubungkan ke jaringan investor global, terutama untuk pendanaan di putaran selanjutnya dengan size check yang lebih besar.

Rekam jejak jadi kriteria utama

Selanjutnya, apa kriteria yang paling dicari oleh responden pada investor? Rekam jejak partner berada di urutan teratas sebesar 85,7%, diikuti oleh kepribadian dan jajaran portofolio yang masing-masing 57,1%, dana kelolaan 42,9%, serta feedback portofolio dan kesamaan visi-misi 14,3%.

Menurut Budi, penting untuk mengetahui rekam jejak dan feedback positif dari portofolio sebelum menerima investasi. Hal ini karena ada potensi investor berlaku manis di masa ‘pendekatan’, lalu malah berubah menjadi controlling ketika sudah berinvestasi.

Hal ini turut diamini Gibran yang menambahkan bahwa penting untuk mengetahui bagaimana gaya investor bekerja dan cara mereka menentukan hipotesis pendanaan. Kriteria ini dapat menjadi kunci untuk melihat apakah investor dan startup dapat berkolaborasi bersama.

“Kriteria penting lainnya adalah rekam jejak dana kelolaan investor, terutama soal fund cycle di tahun ke berapa dan total fund size-nya. Hal ini akan berpengaruh pada ekspektasi exit mereka dan seberapa kuat mereka bisa berlanjut di putaran pendanaan berikutnya,” ujar Gibran.

Bagi Co-founder Zenius Sabda PS, kriteria lain yang tak kalah penting adalah menemukan investor yang memiliki pemahaman tentang bagaimana menciptakan dampak yang dalam dan luas secara sustain. Poin tersebut menjadi sangat relevan jika bicara konteks pendidikan di Indonesia yang memiliki tantangan besar.

Tantangan mencari investor

Seluruh responden menyatakan bahwa sulit mencari investor yang memahami bisnis startup di sektor tertentu, lika-liku pasar Indonesia, serta memiliki etika dalam bekerja. Menurut responden, tak mudah menemukan investor yang memiliki value yang sama dan meyakini bahwa ada hal lain di luar angka.

“Kami meyakini bahwa good product sells itself. Kesepakatan mengenai kapan bisa mengantongi return of investment (ROI) ini berat jika dipaksakan. Ini asalan kami prefer untuk [cari pendanaan] lewat bootstrapping saja,” tutur salah satu responden.

Gibran kembali menambahkan, pihaknya sempat kesulitan mencari investor karena masih sedikit yang paham model bisnis di sektor agritech yang dijalankannya. Karena kondisi ini, ia mengaku sempat mengalami kesulitan dalam meyakinkan investor, terutama mengapresiasi kemajuan. Benchmark di sektor agritech juga saat itu belum banyak sehingga sulit mencari perbandingan round size dan valuasi.

VC lebih fokus kelola pertumbuhan bisnis

Bicara sumber pendanaan startup, Venture Capital (VC) menjadi kategori investor yang paling banyak dipilih responden sebesar 71,4%, diikuti Corporate Venture Capital/CVC, private equity, korporasi masing-masing 28,6%, dan sisanya adalah angel fund sebesar 14,3%.

Menurut salah satu responden, korporasi dinilai lebih mature, tenang, dan stabil secara bisnis. Namun, ada juga responden menganggap bahwa VC lebih cocok untuk investasi jangka panjang, lebih light, dan generik.

Di sisi lain, Gibran menilai VC lebih fokus ke pertumbuhan bisnis, tidak ada takeover dan upaya kolaborasi strategis seperti CVC. Selain itu, VC yang memiliki pengalaman dan tim yang kuat sehingga dapat memberikan insight soal strategi, desain organisasi, hingga model bisnis.

“Dari dukungan teknologi, beberapa VC memberikan channeling ke tech talent maupun best practice. Beberapa juga punya tim internal yang bisa support untuk development. Sebagai startup, teknologi menjadi defensibility. VC yang bisa kasih dukungan ini akan banyak bawa value ke company,” jelas Gibran.

Kebanyakan responden kami juga memiliki kecenderungan besar untuk mencari investor luar negeri (42,9%), terutama investor yang memiliki jejaring atau ketertarikan spesifik di industri yang lebih niche, seperti sustainable innovation. Ada juga yang tertarik untuk mencoba investasi lewat crowdfunding (14,3%).

Ketika sudah mendapat investor, ekspektasi lainnya yang diharapkan oleh para founder antara lain dukungan untuk membantu bisnis sebesar 85,7%, lalu bergabung ke putaran selanjutnya dan dihubungkan ke jaringan investor global masing masing 57,1%, dan investor masuk ke dalam jajaran penasihat sebesar 14,3%.

“Saya pikir tidak ada ‘jenis’ investor yang lebih banyak dicari, tetapi lebih ke siapa personalnya dan apa strategi funding terbaik buat si startup. Jadi bisa lebih match antara goal dan hubungan jangka panjang secara keseluruhan. Misal UKM enabler startups akan sangat strategis untuk ikutan Sembrani dan mendapat investasi dari BRI Ventures,” ungkap Co-Founder Kuassa Grahadea Kusuf.

Tag: Musictech

What Later-Stage Startups Expect When They’re Expecting Investors