How To Start A SAAS

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                                           Strategy for Winning Your First Investor
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                                          The questions that I get requested the maximum almost always ought to do with capital elevating. They say, "I'll do the deal on lockdown." I know it’ll work. "I just can’t find anyone that’ll give me the capital I need." Let’s go over how to get the ball rolling and how to get over the hump with the hardest step, the first one.
                                         
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                                           1. Momentum Capital
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                                          For those of you who aren’t familiar with the principle of "Momentum Capital," it simply refers to the concept that once you’ve raised your first dollar, every subsequent dollar after that gets easier and easier. The same idea applies to sales. The best time to make a sale is right after you just sold someone. Think about it. Most investors don’t want to be the first ones in on a deal or fund. If you hypothetically pitch someone, saying, "Hey, we’ve got this deal coming up that’s going to be amazing," we hope to raise $10 million. Are you interested? You’d be our first investor. People are going to get nervous. They don’t want to put their necks on the line without the assurance that others will join them. Now contrast that with when you pitch the same fund but say, "We’re looking to raise $10 million." "We've got $8 million so far and are just filling out the last couple of spots." Investors can then see that the other person believes and trusts you, and they’ll want a piece of the action. You also tie in an element of scarcity, which can be a powerful motivator for people to join.
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                                            2. Step-by-Step Method
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                                          This is one of the more sure and practical ways to grow your fund. The idea is that you start at the bottom and work your way up. Most will form a series of syndication and acquire experience as they go up the investment ladder on a deal-by-deal basis. This strategy steadily builds rapport with investors and gives you the experience needed to move forward with confidence. Once you get comfortable in one stage, you advance and advance until you’ve got a sizable pool of resources and investors that you can tap into for your fund.
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                                           3. Discounted Shares
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                                          Discounted shares are essentially an agreement that people put in place within one of two categories: a founders' share or a standard share. These shares give you tools to incentivize early investors in unique ways. Those ways could be any of the following:
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                                              Waived Management Fee
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                                              Higher Hurdle Rate
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                                              Liquidity Preference
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                                              Transparency rights, etc.
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                                          The key here is that you have to present these advantages as a bonus. They are only available to those who jump on the deal first. By doing so, you’ll entice those on the fence to make the plunge and jump in with you on your fund.
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                                            4. Anchor LP
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                                           The Anchor LP is an individual, or group of individuals, that agrees to come in early with a fairly large sum of initial capital. They are willing to do this because they essentially treat your GP as if he were a company. The Anchor LP gives you the cash in exchange for a percentage of equity and ownership of the GP, which definitely has its pros and cons. This helps you get the fund up and going and allows you to utilize the momentum capital strategy. However, you’re also surrendering a portion of your control over the fund and its decisions.
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                                            5. Leveraging Partners
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                                           All in all, these are just a few of the strategies with which I’ve been successful in acquiring that ever-elusive first investor. If you can take that first step, you’ll find yourself running in no time. I request that you research these methods more in-depth to truly understand what you can do and then make it happen with the people you pitch to.
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                                        <p style="font-family: Helvetica;">
                                           All in all, these are just a few of the strategies with which I’ve been successful in acquiring that ever- elusive first investor. If you can take that first step, you’ll find yourself running in no time. I request that you research these methods more in-depth to truly understand what you can do and then make it happen with the people you pitch to.
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How To Start A SAAS

Chapter-1

Chapter-2

Chapter-3

Chapter-4

Chapter-5

Chapter-6

Chapter-7

Chapter-8

Chapter-1

Chapter-2

Chapter-3

Chapter-4

Chapter-5

Dan Lesniak

Cody Davis

Samuel Zell