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iHub By Lillian Nduati / August 2, 2012

Unorthodox Ways of Finding Funding for StartUps

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There’s a story in tech circles, of how one Startup raised funding for its operations: They put a beggar outside the offices door, and hang a sign that read:

“Please support this startup, for every dollar you give, I get a commission”

The name of the Startup or how much they raised I cannot remember, but what stuck out was how they raised funding.

There’s also the Million Dollar Homepage,of course.

The Million Dollar Homepage is a website conceived in 2005 by Alex Tew, a student from Wiltshire, England, to raise money for his university education. The home page consists of a million pixels arranged in a 1000 × 1000 pixel grid; the image-based links on it were sold for US$1 per pixel in 10 × 10 blocks. The purchasers of these pixel blocks provided tiny images to be displayed on them, a URL to which the images were linked, and a slogan to be displayed when hovering a cursor over the link. The aim of the website was to sell all of the pixels in the image, thus generating a million dollars of income for the creator.

How are tech start-ups raising money locally?

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Winning competitions, getting incubated at an incubator and now, attracting Venture Capitalists’ attention seem to be the common – tried and tested – ways of raising funding for Startups in the region.

So I wondered, are there techpreneurs out there who are raising money differently?

Here’s what some of the tech community had to say about this: 

“I find it interesting how Kenyans downplay Harambee, isn’t the Kickstarter concept Harambee in a way…? It seems to me that if you call it (fundraising) crowdsourcing, then it’s fine with people” Anne. 

Well, maybe the Somali pirates way of raising funding is fairly unorthodox – but how do you know they’re not investing in tech? There’s a million ways tech companies here could raise funding, but I dont think any of them is really unorthodox – putting your own money,selling your car, getting funding from friends and family, VCs, and so on…it’s all pretty text book. You can pitch your idea for  competition and win – but its happens so much here its not that unorthodox any more. Michael

I haven’t really heard of any inspiring stories coming from this region. You know, stories such as “I was doing this and then there was an investor who discovered what I was doing…and the rest is history” such stories? No, I haven’t heard them here. Linda.

When it comes to money – Kenyans are a bit sensitive and reserved. It’s all sign here, here and here.  There aren’t really that many people with that spirit of real fundraising – looking for unconventional ways of raising money. James.

What is YOUR Startup story?

How did YOU raise funding for your company?

Do you know any interesting ways in which Startups here raised funding?

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But just in case you DO decide  to stick to the traditional Pitch, here’s some Tips. The Fundamentals of Pitching and Essentials for Investor Meetings

More Reading Links

BBC START UP STORIES

Dropbox: The Inside Story of Tech’s Hottest Startup

Failure: The F-Word Silicon Valley Loves and Hates

Author : Lillian Nduati

Lillian runs Media and Communication for iHub and its initiatives, and is also the iHub Editor. She writes opinion and analysis on ICT issues in the region. @nananduati