How to Find Funding For Pre-Revenue Businesses


Securing funding is one of the largest initial challenges you’ll face as an entrepreneur of a pre-revenue business. But if you know what your potential funders are looking for, your odds of success are drastically increased.

Recently, we asked Jimmy Roussel, Entrepreneur in Residence at the New Orleans Start-up Fund, for his perspective. The New Orleans Start-up Fund is an evergreen fund focused on high growth companies.

Jimmy specializes in starting up small technology firms and taking them through the initial round or two of venture capital. He has experience on both the business/finance and technology sides, and can easily translate between the different stakeholders. Here’s what Jimmy had to say:

The Interview with New Orleans’ Start-up Fund’s Jimmy Roussel

Tech Park QuestionWhat are a few characteristics that you commonly find in successful startup companies that you work with?

Jimmy’s Response: “The first characteristic I look for is “the problem space.” Is the start-up solving a problem and is it a problem that people are willing to pay for? This is a necessary common trait of a high-growth startup company.

The second characteristic I look for is the team. It must contain not just one critical person, but an entire team of several people. A startup team should consist of key people that are capable of leveraging their experience, industry knowledge and expertise to execute the company’s growth plans.

The third characteristic I look for is the solution itself. It not only has to solve the problem, but it also has to be achievable with the amount of resources and capital available. So your company should provide a solution for the problem mentioned before. But diving a little deeper, the details of the proposed solution must be feasible and able to be executed from a business standpoint.”

Tech Park QuestionWhat are some examples of dealbreakers which may prevent a company from being funded or successfully growing?

Jimmy’s Response: “There are separate opportunities for entrepreneurs to capitalize on. You can solve a customer’s pain or you can create a gain for the customer. Often, people will create something that is innovative or cool, but doesn’t solve an actual pain point.

While there are many companies that do not necessarily solve a pain, the ones that do tend to be more successful and have more sustainable business models.

Another example of a potential deal breaker is if an entrepreneur has an unrealistic valuation or financial expectations. Most first time entrepreneurs don’t know the true costs of entering the market.

These costs are unpredictable and nearly always higher than what you would expect. When preparing to present forecasts and valuations to an investor, it may be in an entrepreneur’s best interest to anticipate up to two times the expected expenses.”

Tech Park QuestionWhat challenges and opportunities exist that are unique to Louisiana entrepreneurs?

Jimmy’s Response: “As for opportunities, we have industries like food, and oil and gas for which  we have the expertise and infrastructure that leads to a competitive advantage. As for challenges, one of the big ones here is capital. Angel and seed stage investments are growing, but there isn’t enough capital for Series A and later investments. I think that getting this capital is just a function of time.”

The New Orleans Startup Fund is a nonprofit venture fund focused on business creation and innovation in the 10-parish Greater New Orleans region. The Fund exists to accelerate the growth of early-stage, pre-revenue companies looking for proof-of-concept capital. To learn more about the New Orleans Startup Fund, visit

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