Beyond self-funding: 3 pointers on raising funds for your new business

Over 70% of Americans starting a new business in 2023 are self-funding it, according to a recent survey commissioned by Intuit QuickBooks. But relying on your own money isn't the only way to get a small business up and running. 

Although it can seem simpler to invest your own money in a startup, other funding sources are within reach for new small business owners. Just ask Ami Kumordzie, CEO and founder of Sika Health, who raised $6.2 million from her personal network and her first round of venture capital (VC) funding.

In the inaugural episode of Mind the Business: Small Business Success Stories, Kumordzie shared advice about fundraising from her experience raising millions to start her business. Listen to the full episode below.

1. Fundraising is a skill you can learn

Kumordzie's biggest need was for engineers in the technology industry. That meant her first order of business was getting enough money to hire them and pay their salaries. For that, she needed to raise millions of dollars, which she raised by pitching to people in her network and, eventually, big-time tech investors.

"It's made to sound really magical," Kumordzie said. "Like all of a sudden you woke up and had this great idea, and then a bunch of people started throwing money at me — and that's just not how it works. By the time I was pitching to, say, Forerunner [Ventures], I had done my pitch a thousand times."

A combination of practicing her spiel, taking advice on how to better convey her message, and creating documents to back up her pitch was a recipe for success, Kumordzie said. That helped her be prepared when more funding was at stake.

"Fundraising, like any skill, is one that can be learned, one that can be improved, and one that can be perfected over time," she said.

2. You learn from “no”

You come out ahead every time you ask for money, even if you don't get funding, according to Kumordzie.

"You either win or you learn. There's no such thing as losing,"she said.

No one starts off with the perfect pitch to potential investors. Kumordzie used insights from each funding conversation to improve her pitch.

"The times that I learned the most was from the no's,"Kumordzie said. "It was through that learning that I was able to correct and navigate, change this or that about the way that I tell my story and the audience to whom I tell it to so that I could find that right fit that I eventually landed on."

3. People invest in people, not companies

Nurturing your relationships and communities are integral to fundraising for your business because investors ultimately say yes to you.

"Fundamentally, fundraising is a form of relationship-building," Kumordzie said. "People don't invest in companies. They invest in people. What that means is that it's really important — for all aspects of your business, actually — to constantly be building your network and to be building relationships."

It's important to believe in yourself, your idea, and your unique position to bring the idea to life.

"You need to be able to convince yourself as well as investors of two things," Kumordzie said. "No. 1: that the problem that you're solving is a big, important, and urgent problem that needs to be solved. And No. 2: that you are the right person or the right team to solve that problem."

Kumordzie had plenty of other advice about raising money, including how to fundraise with a smaller network, and explained how she beat the odds as one of the 0.34% of Black female entrepreneurs who venture capitalists funded in 2021.

About the Mind the Business podcast

New business? No problem. Mind the Business: Small Business Success Stories, from the team at Intuit QuickBooks, is the source for tools and resources for small business owners as they face new hills to climb. Hosts Jannese Torres (Yo Quiero Dinero podcast) and Austin Hankwitz (Rate of Return podcast) connect with entrepreneurs across industries as they start and grow their businesses. From securing funding to building a team, they'll uncover what it takes to power success.

If you're looking for tools to manage your business and capital, the team of experts at Intuit QuickBooks can get you started with free guided set-up.

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