Sqeeqee Founder Jenny Q. Ta (pictured) talks about fundraising from your loved ones and other survival tips for aspiring entrepreneurs. By Insiyah Saeed (Founder, TheLipGloss)
The worsening of the "Series A Crunch", and the stresses involved in managing professional investors, has some entrepreneurs wishing for a more “friendly” source of funds.
Sqeeqee founder Jenny Q. Ta has done just that for her seed round – she turned to friends and family and raised $2 million dollars – remarkable for a “friends and family” round. When done right, she says, the result can be a winning outcome. She urges new founders to tread with caution, however.
With over twenty years experience managing two brokerage firms she started on Wall Street, Jenny is no stranger to managing large sums of money. Now having raised the $2 million from her circle of family and friends for her social commerce platform Sqeeqee (think Facebook + Ebay), Jenny states her tried and true rules for fundraising and beyond:
Tip #1 - Put your own money in it first.
“Have an idea and/or vision? Sell whatever valuables you have and put it into your startup. If your own parents, siblings and friends will NOT give you money, then shut that idea down. It isn't going to work."
Tip #2 - Have a track record.
“When borrowing money in the family, did you always pay your siblings back, or were you the type of kid that would never pay them back?”
Tip #3 - Don’t give up on your vision.
“It doesn’t matter what people say, even though what they say, it may be 90% correct, if you still feel that that 10% is worth it, you drive forward, because you believe in what you have.”
Tip #4 - Always hire an attorney.
Jenny says one must always cover their back. “I would say when someone has an idea, the first thing is you go to your family and friends to get that first few thousand dollars, and at that point you need to sit down with a professional attorney, especially an IT one.”
Tip #5 - Sign detailed contracts with everyone.
Jenny advises to have contracts in place for everything when you start developing your product. “I always tell people that I am the Winklevii twins in The Social Network. Because of that movie, I learned to always tell people to sign something – it doesn’t matter if they are in India, Philippines, China – or any of those countries, I make them sign the documentation. If they don’t sign, take 'em to the curb.”
About Sqeeqee founder Jenny Q. Ta: Years after the fall of Saigon, Jenny, 6, and her family escaped in 1978 by fishing boat on a treacherous journey to the United States, almost not surviving the trip. After growing up in the U.S and attending college in Fresno, she launched her own full-service brokerage firm investing in technology stocks in the 1990’s and became a self-made millionaire by age 27. Her childhood experiences have taught her to be fearless and take risks. Based in Orange County, CA, she started another brokerage firm, which she subsequently sold. She brings her financial expertise to her social commerce site Sqeeqee, where she blogs. Jenny chronicles her life story in her upcoming book, “Wall Street Cinderella”, which will be released this year in both English and Vietnamese versions.
Women 2.0 readers: Have you raised funds from F&F? What went well and what didn't? Let us know in the comments
About the guest blogger: Insiyah Saeed is a freelance writer and founder of TheLipGloss, an upcoming product discovery site for women. She loves to write about serial and offbeat entrepreneurs. She is a graduate of the Columbia School of Journalism. Email her at insiyahss [a] gmail dot com.