A Startup’s Secrets to Successful Fundraising

If you feel like your business idea is about to be “shelved” because you can’t find an investor, you’re not alone—most entrepreneurs go through this. Below are 7 stories of startups that successfully raised capital in unconventional ways. Let’s explore them with 1Office!

1. Seeking funding from abroad

While building The Zebra—a car insurance search and comparison website based in Austin, Texas—Adam Lyons believed it was necessary to find a similar, successfully developed business model abroad to learn from. Eventually, Lyons found Moneysupermarket.com and its founder, British billionaire Simon Nixon. By emailing a proposal to become Nixon’s partner in the United States, Lyons was fortunate to receive a nod from the billionaire.

“Not everyone thinks of seeking investors who have experience with similar business models in other emerging markets. But for us, what we gained from that action was more than just beneficial,” Lyons shared.

2. Leveraging what you have

In the early 1970s, EJ Jackson, then a private detective, wanted to borrow capital to expand his business but was rejected by all banks. With necessity being the mother of invention, Jackson changed his approach and applied for a loan to buy cars: a 1975 Lincoln and a 1975 Cadillac. Using these two cars, Jackson launched a passenger transport service called Jackson Limo Service in 1977.

Based in Los Angeles, Jackson’s company now has hundreds of drivers transporting passengers in one of America’s most celebrity-concentrated areas. “Sometimes, you have to take what you have and make something out of it. Write your own new history,” Jackson shared.

3. Advertising partners can also be investors

Darin Alpert was the first to join the Find Me Gluten Free project, which later developed into a search tool for places selling gluten-free food. Afterward, Alpert and his team convinced billionaire Mark Cuban’s restaurant chain, Naked Pizza, to become an advertising partner, and then went on to call on the businessman to invest in the project.

“Both deals were handled via email, accompanied by a 20-minute phone call. Soon, our user base grew to 2 million, and we sold the company for a good price in July 2013,” Alpert said.

4. Raising capital at the playground

Abbie Schiller and Samantha Kurtzman-Counter planned to start a media company for children. As they frequented playgrounds, they would let their children play with others while they approached parents for feedback on their product. These informal customer surveys helped them impress other parents, who later became investors in their company, The Mother Company.

The Mother Company is based in Los Angeles and provides book series and programs for children. According to Schiller, her company raised up to $500,000 through such playground conversations.

5. Crowdfunding with Kickstarter

Priska Diaz once thought it would be easy to get $75,000 to realize her business idea using the crowdfunding platform Kickstarter. However, after 3 months, Diaz’s idea for an air-free baby bottle named Bare had not received any investment.

Undeterred, Diaz tried again 3 years later. This time, she created a website to explain the product in detail, complete with prototype images of the bottle. This approach helped Diaz attract widespread attention on media and social networks, with many potential customers willing to wait for the official product. Riding this wave of success, Diaz set up a pre-order system and organized a pre-sale through the website. As a result, she raised over $50,000 in capital for her company, Bittylab.

6. Sharing your passion on Facebook

Bill Gandy enjoyed sharing historical photos of Allegheny City—a northern district of Pittsburgh, Pennsylvania—and was a member of a Facebook group called Born & Raised on Northside of Pgh. Group members highly appreciated the photos Gandy shared, which recalled Allegheny’s glory days. And when he expressed a desire to open a gallery to display the photos, Pittsburgh City Council President Darlene Harris messaged him with a collaboration proposal. As a result, Gandy successfully launched the Allegheny City Historic Gallery. He reportedly raised over $12,000 for this non-profit gallery in less than a month.

7. Raising capital instead of… receiving birthday gifts

In 2008, as Cynthia Kersey was about to turn 50, her life was turned upside down by a divorce. However, instead of wallowing in sorrow, Kersey focused on realizing her dream – helping underprivileged children go to school. Inviting everyone she knew to her 50th birthday party, Kersey asked them to bring $100 instead of gifts.

At the party, Kersey announced to all attendees that she would use the donated money as seed capital to establish a non-profit organization – the Unstoppable Foundation. Thanks to Kersey’s efforts, 6,000 children have been able to attend school and more than 50 schools have been built.

Conclusion:
Above, 1Office has shared 7 unique ways to successfully raise investment capital. We hope these stories will motivate and inspire you, especially young startups.
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