Building robust and scalable companies.
We do things a bit differently than what you might be used to. The people who back us are often people who love startups themselves. They want to help startups grow, but they simply don't have the time to work with startups on a day-to-day basis. Our model is tailored to these individuals.
Every company is different, because every founder is different. So we always adapt our process to each startup's unique needs. However, usually, it goes something like this.
Step 1 - Is this "The Thing"?
Every hypothesis must be tested. Before you can find the right product for a market need, you first need to decide if your idea is in fact the best way solve that marked need. Messing up here will most likely doom your business before it's even begun.
So when we take a new company on board, initially we spend some time deciding if the way it intends to solve the marked need is in fact the best one. Our backers then make an assessment and decide whether you should progress in the program.
This stage normally lasts 2-3 months, and we usually invest about NOK 2-300.000 for 10-20 % equity.
No nasty terms.
Step 2 - Will this sell?
In the end, someone "has to pick up what you're puttin' down."
The second phase is usually spent working closely with a set of customers, perfecting the product/market fit. This phase is all about creating something that people will actually buy. A set of objectives and key results are sketched out, followed by tireless work to generate results. At the end of the period, the backers make another thorough assessment, and then decide if you have the potential and traction needed to enter the last phase.
At this step we usually invest another NOK 800.000 for another 10-15 % equity.
Step 3 - Lift-off
The companies that reach this last stage have excellent traction, customers, sales channels and a strong team. Everything is in place and a robust foundation has been laid.
Now we lay out a plan for the next years of the company. Then, we draw on our vast investor-network both nationally and abroad to create a group of investors who can help push the company into fast paced international growth. Here, XLR8FUND will invest another NOK 1.000.000 given that we can find three other co-investors that are willing to fund the company with another NOK 3.000.000 in total.
This final round of funding concludes the program, and we will stay on as potential board-members.
Why do it this way?
We created this process because we believe that it's the way to ensure that the majority of the invested funds are directed towards the companies that will provide the best returns. To build a succesful startup you need attention to detail at every stage. That's how you identify potential pitfalls early on, and eliminate costly delays later on. With our extensive network we help find the ideal first customer(s), to make sure that the developed product is truly what the market needs. Finally, being part of our thorough process eases the first round of external financing by providing companies with a "stamp of approval."
Our backers also reap the benefits by being in charge of the process all the way, directing the investments towards the best startups.
Ready to start your journey?