Hatty Fawcett, founder of Focused For Business, has a proven track record of raising equity investment for early-stage startups, having raised over £5m for the start-ups she’s worked with in the last 12 months.
Hatty believes start-up investment should be available to everyone and the process shouldn’t be over-complicated or unnecessarily time consuming. She is known for her work with underrepresented founders.
Tell us a bit about yourself, background and your current role (this can include anything you are up to in terms of projects/initiatives – feel free to plug)
I’m a marketeer by training and had a 15 year career in marketing. But I got back in touch with my inner entrepreneur while doing an MBA at Imperial College in London. And as part of that, I entered a business plan competition with a group of friends from my cohort. We didn’t win that competition, but I loved the whole process. It reminded me how much I love creating businesses from scratch, as I had been quite entrepreneurial earlier in life.
Although we didn’t win the competition, I joined a friend I made on the MBA in his startup, and we took the business from zero to £3 million turnover in two years. It was a roller coaster of a ride, but I loved it. Coming out of that business, I decided to do it all over again, and set up my own startup. That business grew quickly, so to make the most of the opportunity, I needed to raise investment. This was a challenge, as I had never raised investment before, I made all the mistakes that every first-time founder does. Afterall, the first time you do something you “don’t know what you don’t know!” But, ultimately, I raised £150,000, angel investment, and I went on to do two rounds of crowdfunding. After that business, I supported Kelly Hoppen when she was a dragon on the TV show Dragon’s Den, and looked after some of the investments she made. So, I’ve been lucky enough to see investment from both sides of the fence, what it takes to raise investment as a founder, but also what early-stage investors look for when they back a startup.
It’s because of the insights gained throughout my career, that I can see first-hand the problem that many founders face today when it comes to raising equity investment, particularly their first or second funding round. That’s what prompted me to create the Funding Accelerator programme. I’m on a mission. I want to make it faster, but also fairer for founders to raise equity investment. I say fairer because all the data shows that too many startup founders struggle to raise investment because of their gender, ethnicity or the location of their business. The Funding Accelerator programme supports startups in preparing all the documents they need to raise investment, shows them how to find the right investors (we even give them a “hit list” of people to reach out to) and how to negotiate and close the deal – all in just 90 days.
Did you ever sit down and plan your career?
No, absolutely not. But looking back at my career, do I see a flow? Do I see connections that have happened because of the choices I made? Yes, definitely and, with hindsight, I can see that there was a logic to the choices I made and everything I have done.
My marketing career gave me a really good understanding of customers and the importance of listening to your customers. It also taught me how to promote and sell products and services, which is vital when you’re running a startup.
The experience of being a first-time startup founder means I can now empathise and support founders from a position of real understanding of what they are going through. And, having worked with investors, I understand their motivation and am better placed to support founders in their conversations with investors.
So, no, my career was never planned, but everything I’ve done has led me to do what I am doing.
Have you faced any career challenges along the way and how did you overcome these?
I raised investment for my business 10 years ago. It’s tough for female founders to raise investment today, but it was even harder 10 years ago. Perhaps not much has changed! Last year only 3% of Venture Capital (VC) funding went to female founders! I’ve experienced the bias that exists amongst investors, the stereotyping that goes on and the challenges that female founders face when raising investment, because I’ve experienced the same challenges. I’ve experienced being the only woman in a room when you pitch. I’ve also found my pitch hasn’t gained the attention it should because the (largely male) audience doesn’t understand the female target market. I’ve experienced these challenges but, on the positive side, it means I am well placed to support founders experiencing similar problems today. Underrepresented founders who were just not getting the investment they deserve. Sometimes the challenges you’ve faced allow you to empower others.
What has been your biggest career achievement to date?
50% of the startups who complete the Funding Accelerator successfully raise investment. I’m really proud of that statistic – especially since the national average is just 40% of businesses completing an accelerator programme get investment. But, the achievement I am most proud of is more unexpected. 25% of the startup founders who complete our programme chose not to raise investment. They understand what it means to take equity investment and they know how to raise investment, but they make a powerful choice not to raise investment. They see another way of raising funding, or they decide to make more progress in the business before going for investment, in order to get a better valuation when they do raise equity investment. It might seem odd that someone who helps startups raise investment is proud when they don’t choose not to raise investment, but it demonstrates we are giving founders the knowledge and the understanding to make powerful choices for themselves. Equity investment is not for everybody, nor should it be. I’m delighted we give founders the skills to make the right choice for their business.
What one thing do you believe has been a major factor in you achieving success?
My first-hand experience – and seeing some of the structural challenges we face in our industry – gives me the motivation to drive change, to make a difference. There is a passion, a fire in my belly, to see change.
What tips would you give to somebody a founder who is looking to raise their first or second funding round?
First of all, you need to be sure that now is the right time for your business to raise investment. Raising investment is time-consuming and a distraction from your “real job” of growing your business. So, before you start raising investment, it is worth checking you are ready to raise. Our Startup Investment Scorecard – just 20 short questions – helps startup founders understand whether now is the right time to raise equity investment, or whether you’d be better placed putting your focus elsewhere.
When you are doing something you haven’t done before, you “don’t know what you don’t know”. It’s really helpful to surround yourself with people who can fill your knowledge gaps. On the Funding Accelerator we surround our cohorts with a supportive community – that includes founders who are also raising investment and on a similar journey, experiencing similar problems, and expert mentors (we have more than 50) who generously share their expertise to help our startups achieve their funding goals. A strong community not only gives you access to knowledge, but it helps you maintain your motivation when the going gets tough!
Do you still think there are barriers to female founders accessing funding?
Yes, definitely. As I mentioned, less than 3% of VC funding went to female founders last year, and the statistics are even worse if you are an ethnically diverse founder. If your business is based outside of London, then all the statistics show it will be harder for your business to raise investment too. These are stupid reasons for not backing good businesses. That’s why I’m on a mission to level the playing field and provide fairer access to funding.
What do you think can be done to support more female led startup businesses?
There’s a lot we need to do, but a good starting point would be ensuring we have more diverse investors. Only 14% of angel investors in the UK are female and this number needs to increase if we are to increase the number of female-led startups getting funded. We also need to broaden the conversation about what type of businesses make a good investment. Many angel investors are focused on a “one size fits all” approach to investment. They love to back businesses based on technology, or subscription as a service (SaaS) business models. If a business doesn’t fit this model – irrespective of its ability to make good profits – it is less likely to raise investment.
What resources do you recommend for female founders about to start their funding journey, or who are currently raising investment?
Every week, I run a free, online Funding Strategy Workshop and it’s a good place to start to prepare for investment – but also to pick up ideas for accelerating your funding round. I share lots of insights that will improve your chances of securing equity investment, and its also an opportunity to ask any questions in a safe environment. There’s no such thing as a silly question!
Read more from our inspirational women here.
