In this episode, Hall welcomes Laura Baldwin, Managing Director of Golden Seeds. Golden Seeds is an investment firm dedicated to pursuing market returns through the empowerment of women entrepreneurs and the people who invest in them. The group was founded in 2005 and is headquartered in New York City, with active chapters in Atlanta, Boston, Dallas, Houston, and Silicon Valley – and active members throughout the country.

Golden Seeds’ Angel Network has grown to become one of the largest in the country with over 275 members nationwide. Laura has more than 20 years’ experience in finance, treasury, corporate development, and investor relations roles, with progressive growth in responsibilities.

Laura talks about the increase in women entrepreneurs, in sectors such as FinTech, Cybersecurity, and others. For investors, Laura emphasizes the importance of communication between investors and the entrepreneur. Beyond personal connection and trust, she says it is also critical for entrepreneurs to have a clear value proposition. Laura advises entrepreneurs to make sure that they and the investor are "on the same page [and] want the same things." She explains what Golden Seeds looks for in a startup, and highlights some of the more promising startups they've worked with. According to Laura, capital access remains the biggest challenge for women-led startups. Finally, she points to FinTech as one of the biggest sectors of opportunity now.

Many enterprise software programs come from service businesses solving a problem for their clients. In searching for a solution on the market, they find none, so they build their own. Later, other clients come ready to buy it.

I call this contractor funding, and it’s one of the most overlooked forms of funding in the startup space.

In this method, you sell a customized version of what you want to build to an anchor customer for a substantial one-time fee, say $250K. Then, you use the funds to build out the platform you envision, to which the customer gets a non-exclusive license.

The advantage here is you have a customer telling you exactly what they need and what they will pay for. They improve the product by testing it and telling you what changes to make. They become a happy customer which you can use to attract prospective customers.

After three more of these engagements, you will have $1M of investment in your platform with zero dilution.

For your raise, consider using contractor funding.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today!