office@novator.bg

Frequently Asked Questions - Fundraising

Frequently Asked Questions - Fundraising

What stage of the company life cycle you prefer to work with?

Proof of Concept Seed and Series A stage – meaning the startup should have either been funded on a Pre-Seed level or have been strongly bootstrapped to date. Ideally, we’d like to see some product-market fit, early market traction, paying clients, etc.

What business sectors/verticals do you look into?

NOVATOR focuses on scalable companies with international product/service offering with no specific sector restrictions. However, verticals such as Fintech, eCommerce, Travel, Retail, and Enterprise Software are some of those where we can provide the most value.

Do you have any geographic restrictions?

Not really. We are based in Bulgaria but we are working with startups from the USA, Asia, UK and other EU countries. However, we have our preference in working with Bulgarian companies in order to support the local ecosystem.

What is the usual target investment size and funding type?

Our service offering usually concerns deals ranging from EUR 50k (Angels round) to EUR 5m (Series A round) structured as convertible debt or direct equity participation. We are not acting as a typical Fund manager providing the liquidity but rather are actively supporting you in finding and bringing onboard the right Lead Investor and long-term Partner for you company.

Are you an investor or an advisor?

Although we have some funding capacity we focus first on the acceleration, advisory, and business development side where we could add the highest value. However, we always actively look for opportunities to co-invest up to EUR 50k in the most promising Startups which show some real progress going through our Program. The acceptance into NOVATOR’s Program does not mean a direct investment commitment from our side; we decide case-by-case depending on the project, the current funding capacity of our investment arm, as well as the maturity of the deal.

Why would I need you if I could raise funds on my own?

True, some founders are well connected with investors, have experience with financial matters, and are also good in pitching and storytelling. Usually, however, the fundraising process is a long game and exhausts a lot of resources, so your company operations may start lagging behind during the raise (usually 3-6 months) if you do it on your own. On the other hand, we target startups that reach out for external help because they understand the importance of focusing their energy on the core business. Our approach is hands-on and we are fully dedicated to the startups in our portfolio. We fundraise instead of you or alongside, which saves you time and effort and increases significantly your chances of getting funded.

Is there a fee for taking part in the program?

Yes, the majority of our compensation is based on results and milestones reached. We help you getting funded in exchange for a retaining advisory fee and/or a success fee based on the amount of funding secured. If you are approved for one of our batches, we will make you a tailor-made proposal for both fundraising and for some of our mostly requested value-added services.

What type of investors are you working with?

Our investors network includes private and public funding sources. Mostly, our pipeline consists of business angels and family offices, accelerators and incubators, business angels clubs, venture capital funds, private equity firms, corporate and strategic investors. Among all however, we could also support you in receive funding from financial and government institutions, public grant schemes, etc.

How many companies do you accept per batch?

We currently accept 3 to 5 Startups per each intake. Thus, we could guarantee our full attention and dedication considering the available resources at the moment. Keeping our batches smaller allows us to keep our commitment for high quality and professional standards when executing our Program.

What is the length of the Program?

The most intensive part is in the first 3 to 6 months of our cooperation. This is when we work with you on your business model, prepare you company for the raise, etc. There is no fixed expiry date of our involvement with each project. We work with our portfolio companies for as long as it is needed and adds value for both sides. Typically startups exit our program after closing of multiple funding rounds and moving into a different scale (Series B, Acquisition, etc.). Since we aim to have equity participation in most companies we accept to work with, our horizon is long-term (3-5 years).

What is the difference between you and other accelerators and incubators?

  • Our batches are smaller (3-5 startups per batch) with an individual approach and hands-on support for each Project.
  • We don’t take equity in advance, our compensation is linked to actual milestones reached as well as to the success of each portfolio company.
  • We are results driven, meaning our program is practical, not theoretical. You should not expect classroom type presentations, lectures and workshops? We advise you on your strategy and connect you with the right mentors, partners and investors.
  • We don’t require physical on-site presence. We follow a digital & novel approach to each assignment and are truly globally oriented.

What is your Value added service offering?

Besides fundraising, we usually add value by providing you with a wide range of shared business services. You can learn more here…

What is your success rate?

The success of each startup depends on the quality of the project and the commitment of the Founders. Not every project is fundable, therefore we only engage with teams that have the highest potential to succeed. In any case, we cannot guarantee investment by any means. What we could promise is a professional attitude and our best efforts with respect to your case, should we decide to take upon this journey together.

How do I apply and what are my chances of getting accepted?

You should get in touch with us and send us your presentation / project description. We usually get back to you within a couple of days as soon as we are in an active pre-screening window. Statistically the acceptance rate in the program is about 10% of the companies that match our application criteria.

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