The first step is to do your research. There are a number of different funding bodies in South Africa, but they all have different mandates. You need to recognise a funder that is currently interested in the medical space. Do online searches, join networks and get out there. Meet people.
Speak to fellow entrepreneurs and people within the medical field and ask them to introduce you to players within the industry that could give you advice.
Doing market research will also assist you – who are your competitors and how are they funded? What are their pricing points? You will need a fully comprehensive business plan before you approach any funder.
However, most funders and financiers will want to see that you have either raised some capital yourself, or have some form of surety. A bank is unlikely to give you a loan with out surety, as you are far too much of a risk.
Venture capital firms and angel investors will also see you as more serious about the business idea if you have put your own money into the business as well.
You will also need to demonstrate the following when you approach a funder:
- The ability to demonstrate convincingly why you can best execute on the business thesis – you need to have done their research and considered every angle.
- A sound business thesis and business model with appropriate potential are paramount. Can you demonstrate low costs, high leverage, the ability to scale exponentially, and how you will tap large hungry growing markets?
- There are endless possible deal-breakers, so be aware of them. IP issues can pose a big problem. Be prepared to answer these questions in your pitch.
- Finally, do your research. Different funders have different focuses. If you pitch to the wrong firm, and your business does not suit their mandate, you will get a no – and a poor reputation to boot. When you go back with a good fit, you might even be ignored based on poor pitches before.