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Streamlining the Capital Raising Process: Lessons from Blockbuster and Netflix

  • Published April 06, 2023 2:40AM UTC
  • Publisher Jade Miguel
  • Categories Capital Raising Tips

If you’re old enough, you may recall the nostalgic experience of visiting your local Blockbuster video store on weekends. While those memories make us smile, Blockbuster’s downfall illustrates the importance of market efficiency. In just six years, Netflix emerged as a game-changer, offering instant access to movies and leading Blockbuster to bankruptcy.

Similarly, inefficiencies can plague the capital-raising process, costing you time, money, and opportunities. To improve efficiency, consider the following areas:

  • Pitch deck and its structure
  • Investor communications
  • Deal room materials for investors
  • Investor meeting structure and conversion rate
  • Attracting and qualifying investors
  • Conversion rate from potential investors to actual investors
  • Understanding key interests of potential investors

By addressing these seven areas, you could potentially secure an additional $500,000 for your business or save six months of fundraising time. Here are some recommendations for founders seeking to create efficiency in their capital raising process:

  1. Plan a strategic capital raising campaign that spans at least six months.
  2. Gamify the process by understanding your numbers and conversion rates.
  3. Treat recurring questions as mistakes in your process that need to be fixed.
  4. Set target benchmarks for yourself to achieve.
  5. Be diligent in your efforts, remembering the adage, “The harder I work, the luckier I get.”
  6. Your goal should be to reach a ‘yes’ or ‘no’ decision as quickly as possible, respecting both your time and your potential investors’ time.

In upcoming articles, we will discuss specific activities to save up to a month of your time each year and minimise revenue and opportunity costs in the capital-raising process.

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