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Milestone Chapter 5

Part 1: Who are you as a business?

The first part of the finance map guides you through three major questions:

  • Who are you and what do you do?
  • How do you plan on making/make money? Do you already have profits? Do you already have revenues? (How) do you want to grow?
  • In which stage of your startup journey are you? (Pre-Seed, Seed, Series A, ..)

Here, you should consider your current situation in terms of size and assets, your business model and sector and your current stage and growth projections. Are you already profitable or have a clear path towards profitability? Or are you in the very beginning and still researching/developing/launching/scaling? Do you have a proof of concept and data to support your business case? This affects the risk level of the investment and thus filters the investors willing to invest and the usable financing instruments. Additionally, your business model and sector determine whether specific public funds or (impact) investment funds could be available as funders/investors.

  • What is your current financial situation?
  • What does your capital table look like (debt/equity)?

Do you have debt? Do you already have investors in the company? If so, which (financial) obligations come with them? What rights do your investors have (e.g., voting rights, approval rights, etc.)? What is their role in the transition to steward-ownership? What is their role in the future financing round?

Learn more about how to deal with previous investor in this chapter.

  • What securities and resources do you have that derisk the capital for the investors?

Here, you should think about any factors that could derisk the investment in your company for investors.  The financing instruments available to you will largely depend on your company's size and the assets you can offer as collateral. For example, traditional loans are often not an option for startups due to their lack of tangible security.

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