Securing funding isn’t easy, and you have to kiss a lot of frogs if you want to succeed, says Airtasker CEO and co-founder, Tim Fung.
“Don’t be disappointed if someone says no,” he adds. “You should actually be prepared for most people to say no, and one in probably a hundred people to say yes.”
Fung’s four-years-young business is a community-based skill marketplace for people to outsource tasks, find local services or complete flexible jobs to earn money. Recently, Airtasker secured a mammoth $22 million in funding led by Seven West Media, with follow on investment from existing shareholders, Morning Crest Capital, Exto Partners and NRMA, giving it a total of $32 million in capital since it was founded in 2012.
“It certainly wasn’t easy,” Fung says. “It wasn’t like we gave Seven West Media a call just a few weeks ago and had it secured. We definitely built a dialogue over time. But Seven West had a lot of foresight and reached out to us about a year ago, so when it came to finally deciding to raise the capital, we immediately started discussions with them and told them what our plans were – which developed to where we are now.”
“Don’t be disappointed if someone says no. You should actually be prepared for most people to say no."
Be prepared to articulate your offer
In Australia, if you want to secure funding, Fung recommends start-up founders prepare to really articulate the offer – and be ready for a lot of due diligence.
“In Silicon Valley in the US there are a lot of people who just pitch an idea and the conversation rolls from there, but in Australia, the culture is a little bit different,” he says. “You need to line up all your ducks, know what you think you’re worth in terms of your valuation and in turn present that offer to make it easier for a potential investor to say yes.”
Story is also important and while it’s natural to change your story as a start-up over time, Fung stresses you need to be prepared to answer some core business questions.
“So if someone asks you what you want to do in three years, you should have an answer for that, because the worst thing you can do is say I don’t know or I haven’t thought about it,” he says.
Focus on core business values
Fung believes it's Airtasker’s community-led approach that has driven the success and growth of the business.
“One of our core values is to be community first,” he says. “And I think that's definitely been a very important value to have throughout the business, because it drives everything we do.”
Whether it’s handyman work, office admin, photography or anything else, people and businesses post a task for free and then choose from rated, verified and reviewed people ready to work straight away.
“Airtasker is built on a community, and from an entrepreneurial and technology perspective we call that the network effect,” Fung says. “So what that means is Airtasker improves as more people join the platform and join the community, because it gives us a wider range of skills and engagement.”
“So if someone asks you what you want to do in three years, you should have an answer for that, because the worst thing you can do is say I don’t know."
Paving the way for future growth
Airtasker last raised $6.5 million in May 2015 and since then has more than doubled its total number of users from 250,000 to over 600,000 community members. Meanwhile its transaction volume has grown to more than $40 million per year.
The business is set to use the additional funding to further develop its core marketplace product, grow the Airtasker brand and build on its tech team that will underpin its growing platform.
“While we’ve seen rapid organic growth over the past year, we’re only scratching the surface of a multi-billion opportunity - we still have a huge way to grow in Australia alone,” Fung says.
As part of the deal, Seven West Media secured a 15 per cent stake in Airtasker and will also provide media support and investment to drive the platform’s growth. Airtasker further announced two new additions to its Board of Directors, Vocus Communications founder and CEO James Spenceley and Seven West Media sales director, Jenny Hosie.
Azadeh Williams is a former business and finance news editor at Thomson Reuters, Azadeh Williams has written over 3,000 articles in her 15-year international career on business, technology, marketing and innovation for the likes of The Times, CMO Magazine and Fast Business. She has also lectured in business journalism and media law at Macleay College.