Securing funding for your start-up or scale-up can be daunting, especially in the early stages of your journey. While many founders start out thinking that securing Venture Capital (VC) is the only path to success, many more funding options are available.
At AusMedtech in Sydney earlier this month, Radium Capital’s NSW State Manager and National Sales Team lead Pat Stewart asked an expert panel to share their insights and experiences in leveraging different funding strategies throughout their journeys.
Between them, Lauren Barber (founder and CEO of NeedleCalm), Damian Shrubsole (Head of Investor Relations and Company Secretary, Rapid Response Revival) and Katja Beitat (Group Executive, Health Incubators and Programs, Cicada Innovations, and an exited founder) have decades of startup experience. They agreed being an entrepreneur was not easy and were eager to share their insights to help others avoid making the same mistakes.
Set yourself up for success
Series A, Series B, Angel C, equity vs non-dilutive funding: founders face a steep learning curve when they set off on their funding journey and, without a guidebook, how do they know where to start? As a nurse with a great idea for a new product, Lauren said her founder journey had been long and hard. “Entrepreneurship is glamorised, but people don’t understand that once you get into it, you get in so deep that you need to finish.” As well as “getting a good accountant” Lauren suggested doing an MBA, something she wished she’d done, in hindsight.
Damian agreed, saying that it was worth delaying your start up until you’d done an MBA. “A lot of it is about a way of thinking: we don’t know the answers, but we have a cultural strategy on how we think about things, whether that’s finance, regulatory or technology.” He said this foundation helped founders “scratch behind the surface” of any advice they received in business to make sure it was right for them.
Start at the end
Once you’ve laid your foundation, Katja said it was crucial founders invested in forward planning. “I urge anyone before even thinking about incorporating to have mapped out, on paper, how it would be possible to exit [the company] or to manufacture it [your product]”, she said. “Which market will you get into first? Think that through to an obsessive level of detail.”
Damian reminded founders to think about the long-term ramifications of any decision, financial or otherwise. “You’ve always got to be thinking ahead. What you do today is very important in the future.” Katja said that was especially important when setting up your first shareholder agreement, to ensure you retained control of your company over several funding rounds.
Find a way to inject funding certainty
In a start-up, fundraising is relentless. Damian said, “Once you finish your last capital raise, you’re starting your next one.” However, he said many funding sources came with a level of uncertainty: “You can go down the road with a VC or a fund and do all the due diligence in the world, and you can get to the point where everybody’s prepared to sign and if the money doesn’t hit the bank, it’s not a close.”
He said that it was good to include some more certain funding in the mix, which was one of the advantages of an R&D Tax Incentive (R&DTI) loan like the Radium Advance. “There is a very defined process: you either tick the boxes or you don’t. There is a certainty in that relationship that we appreciated and liked, so we’ve used Radium Advances for three or four years because of that,” he said.
Katja agreed R&D loans were an attractive option “because they give you clarity. You know exactly what you get and what you need to put on the table. You are not taking a risk as a person, you have no one who interferes with your business and wants to have a board seat and brings their mates in.” With the world undergoing a period of unprecedented change, megatrends are combining with innovation, geopolitical and economic trends to reshape the diverse capital stack playbook.
Apply for grants, but don’t bank on getting them
Governments at all levels are keen to support innovators, with grants available at local, state and federal levels. The government focus on sovereign manufacturing means more grant money is available to companies planning to produce their product onshore. If you’re not going to manufacture your product yourself, consider finding an Australian business that can, to help you unlock funding.
However, while they can provide useful funds, grants don’t always provide the right money at the right time, and applying for them takes time out of product development. “Sometimes the design of what’s supposed to help people hasn’t been workshopped with the people it’s supposed to help,” Damian said.
Lauren said the time taken to apply for grants was frustrating, especially when you were unsuccessful and “you just get a sentence back to say, ‘We’re too busy to give you a proper response on why you didn’t get it.’” She said grant applications cost time and money: “There’s all these different conditions, and it’s cost me a lot of money [to comply].”
Consider alternative funding sources
Your final product is not the only thing that can make you money. Katja reminded innovators that they could use their expertise to make their company money while working towards getting a product to market. “You are an expert in your field, and you can get paid for working up clients: that is consultancy. You will not get all those clients as actual purchasers of your product, but the time you spend in understanding their workflows and how they can improve their workflow is invaluable,” she said.
It pays to be creative and to make sure you get a return for effort. Katja suggested thinking laterally as well as strategically: “You could license some of your technology for other users to get a revenue stream in…Never, ever have an unpaid trial that does not have a very clear success metric that leads to procurement once it is hit,” she said.
Most importantly, maintain a sense of urgency. “Try to shorten the time to any type of revenue, because that makes you more independent of money: every minute you spend fundraising is a minute you’re not spending on developing your business. It’s a massive opportunity cost,” said Katja.
Build an aligned team, seek advice and partner strategically
Damian said founders needed to build a team of people, both staff and investors, who shared their vision.
Have an accountability partner – Katja said entrepreneurs are the kinds of people who can always see an opportunity, so they need to have “someone who says, ‘No, that was the last step, and you need to walk away.’”
As an exited founder, Katja says her main reflection was that “it should not have been that hard”. She recommends others seek help from business incubators such as Cicada Innovations for funding advice, as well as access to networks, capability, and policymakers.
Don’t confuse fundraising with success
While having money when you need it is key, Katja cautioned about losing sight of the end goal: “The metric of success in business is that you are hitting commercialisation milestones towards getting product to market and getting revenue. Always strive for momentum and speed to market as your success metric before you define success as funding another round.” She emphasised this with a cautionary tale, “We’ve had fantastic companies die at their B Series because they couldn’t move their product. There was no market adoption because they were in love with raising money.”
Damian said that while the challenges of financing a startup were sometimes overwhelming, it was important to consider all your options and remember why you went into the business in the first place: “The fact that we’re saving lives [by making a portable personal defibrillator] really makes me emotional when I talk about it.”
*Published May 2025
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