Business Rx: How to keep investors happy as you spend money to grow
Gurpreet Singh got the inspiration for his newest company, Seva Search, from an earlier venture, an IT services firm called Geeks On-Site that he launched in 2004. Callers to Geeks On-Site had a common complaint — when they needed computer help, they wanted immediate service. If Singh’s calendar was booked, they resorted to calling another firm. Singh recognized this need for consumers seeking all types of services — from plumbing to snow removal to auto repairs. With Singh’s Seva Search, founded with Manpreet Singh and Amandeep Bakshi, users can use the company’s Web site and mobile app to connect with local service providers who can meet their needs immediately.
“Seva Search, based in Potomac, focuses on the hyper local search market. We will soon debut our first product, Seva Call, a local search engine that seamlessly connects consumers with local businesses in near real-time. Until now, consumers have had to spend countless hours researching and calling several businesses trying to find the one that meets their individual requirements including availability, location, specific need, cost and, above all, quality.”
“Seva Call matches consumers and local businesses based on signals including online ratings and reviews, social reputation and interaction, call analytics and other forms of consumer and business feedback. Consumers using Seva Call receive phone calls from qualified businesses in a matter of minutes.”
“We’ve been getting all of the kinks out of our platform. Beta testing revealed the importance of speed and service provider quality. Right now, the Seva Call process happens in less than a few minutes and users can be confident that they will be connected with top-rated service providers, determined by ratings posted on top local search review sites.”
“We’re currently still in the beta stage, but we’re gearing up for a Washington area launch early this year. We’re planning an East Coast, five-city rollout to extend to Baltimore, Philadelphia, New York and Boston.”
“We’re excited about recent success in closing on a $1.3 million Series A funding round that includes prominent investors, successful serial entrepreneurs and top angel investors from North America, South America, Asia and Europe. We also put up our own money. Getting this funding cleared a big challenge for us — we had a dozen or two rejections before we got that first ‘yes,’ and being in Washington as a tech company approaching Silicon Valley and Boston venture capitalists proved challenging. But once we got that validation of the first investor, it was like a snowball effect for Seva Search.”
“We will use the proceeds from our funding round to improve and market Seva Call. We need to make sure we are putting our funding to the best use possible to grow our company and perfect our product. How do we make sure we’re striking the right balance of scaling up, marketing and keeping investors happy?”
Elana Fine, associate director, Dingman Center for Entrepreneurship
“You will keep your investors happy by using your capital efficiently to execute on the plan they have invested in. You’ve successfully raised financing by convincing investors that you have a strong product, a talented team and a thoughtful growth plan. If you stick to your plan, pivoting only when necessary, you’ll maintain their support.
“We have all learned the lessons of tech companies that waste investor dollars. You and your peers in the local start-up community understand how to run lean companies. Stay lean, even with your recent funding, and test your customer acquisition strategies before overspending. You’ll be able to better understand your target market without blowing your budget.
“Keep your investors happy by keeping them informed. Investors expect bumps, but they don’t like surprises.”