How to prepare for fundraising

New Media - Sports Business

Author: Lucia Cisterna

30 July 2021

Successfully raising capital is all about researching potential investors and organizing the materials to support your pitch before seeking out an investor who gets your company’s potential. However, it is also important to find an investor who really understands you – who wants to get to know you and who wants to build a relationship that is successful for you both. Obviously, you need to show a potential shareholder that your business is growing – but ultimately, you need to demonstrate passion and knowledge.

Businesses often begin with equity from family or friends, but once you get beyond that initial spend and have created a product that you think is good enough, it is likely you will need to raise money from professional investors. Before you start approaching investors for your first professional investment, it is important to prepare well.

Equity Story

Entrepreneurs are great at explaining the benefits of their product or service but less good at explaining to investors why they should invest in them. Investors want to know why the business is going to make money for themselves and their own investors.

This is your equity story – the reason why you will make money for your future shareholders. You need to give them confidence in you and your company and familiarise them with the project. Investors are likely to be highly knowledgeable about multiple markets, which will help them to advise you in later stages, but initially they will evaluate you and your plans extremely sceptically.

DAZN, the over-the-top subscription sports streaming service, first had to explain the concept of internet distribution of sporting events as a better alternative to television distribution. Its equity story was that it could achieve higher value for sports rights than traditional TV distribution and that this would create a new market for fans to watch content on smart mobile devices.


Investors will try to work out how big the market opportunity is by asking what the size of your Total Addressable Market (TAM) is. They will want to know information regarding your top level market statistics – if your concept is successful, how many people in the world would buy it and what is its overall value?

Investors will be keen to see if the entrepreneur knows their current market, particularly their international competitors, and if they know how big the potential future market is. They will also be keen to see you demonstrate proof of knowledge of the competitive dynamics as well as your strategy to target incremental markets (and their potential revenues).

The sports apparel market has increased enormously as a result of thinking of the market as a fashion market and not only as a sports equipment market. Investors are more willing to invest in larger market opportunities.


Investors will want to know your value proposition – why a customer should buy your product compared to a competitor. Investors are also interested in your unit economics – the costs of unit sale and delivering the service – and will want to understand all other expenses. They will be keen to know your strategy for introducing additional markets through a roll out model by country/market.

Create a product road map – this should incorporate a sequence of features as well as the priorities and commercial reasons your product will need additional functionality later on. Investors will hope your product is self-sufficient and that it won’t need additional support.  However, if it does need to evolve, the investors will be keen to know what these additional features are, how they are to be delivered and how they can be paid for. This map should demonstrate how these engineering costs will develop in the future.

Alex Mather and Adam Hansmann started The Athletic with the mission of producing “smarter coverage for die-hard fans”. The business was built using a paid subscription model at a time when the conventional wisdom was that internet content had to be free. The idea clearly has global potential. However, its MVP was to launch in Chicago covering the Chicago Cubs (baseball) and Blackhawks (ice hockey) to test the idea that sports fans are willing to pay for high quality, sports journalism. After testing the MVP, The Athletic, has expanded to about 20 cities in the USA and Canada. It started in Europe by launching in the UK in August 2019 offering coverage of football both within the UK and internationally.


Investors want to have some sense of your passion and ambition and will be evaluating you to assess your knowledge and skills, and how you work. They want to be reassured that you have a complete, expert managerial line-up behind the business.  Emphasise how strong the executive team is and showcase the credentials of specific members.  Fundraising is also a good opportunity to seek out candidates for gaps in the team.

USA gymnast Shannon Miller moved from being an Olympic athlete to advocate for the health and wellness of women and children. Shannon Miller Lifestyle reaches the community through various programs, products and partnerships, including with The Juice Plus+ Company, with the aim of educating, motivating and inspiring all women to be their very best.


Investors expect to have transparent financials available immediately, including monthly management reports, a current 12 month rolling P&L forecast, a three-year business plan by quarter, and a 12 month rolling cash flow forecast. This will be a key test in displaying your endurance and ambition to the investor. You won’t excite your investors or be seen as ambitious enough if you suggest low growth. However, if the growth rate is pitched too high, you will be regarded as unrealistic.

Finding the balance between growth and profitability is hard but important, and it is critical to calibrate your business plan towards the specific investors you are pitching to. Integral to all of the above elements, is that it is your aspirations and ambitions that are paramount in attracting investors to buy into your business. Ultimately, show why you are worth investing in and how you are going to make money in the future for them (and their shareholders).


Tania Vie Riba