{"id":2100,"date":"2011-11-02T08:24:22","date_gmt":"2011-11-02T13:24:22","guid":{"rendered":"http:\/\/www.ict-pulse.com\/?p=2100"},"modified":"2011-11-02T08:24:22","modified_gmt":"2011-11-02T13:24:22","slug":"6-reasons-why-caribbean-tech-start-ups-cannot-access-funding","status":"publish","type":"post","link":"https:\/\/ict-pulse.com\/2011\/11\/6-reasons-why-caribbean-tech-start-ups-cannot-access-funding\/","title":{"rendered":"6 reasons why Caribbean tech start-ups cannot access funding"},"content":{"rendered":"

What are some of the challenges in securing business financing in the Caribbean? This post offers 6 reasons relevant to the tech\/ICT industry.<\/em><\/p>\n

The challenges of financing a start-up, and a tech start-up in particular, is a common lament across the Caribbean. Frequently this claim has also been a deterrent to many to develop their ideas and start a business. This post outlines six reasons why access to funding can be difficult in the region.<\/p>\n

1.\u00a0 Not much funding is available<\/h3>\n
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By AMagill (Flickr)<\/p><\/div>\n

This is a cold hard fact. In addition to limited Venture Capital and few Angel Investors being available in the region, conventional financial institutions consider most tech operations as risky ventures. Start-ups might have a better chance of securing funding if they are working with more tangible products, than trading in services. Nevertheless, commercial lending rates, which tend to be exhorbitant, are normally applied, along with considerable collateral provisions, which a young entrepreneur might not readily have at his\/her disposal.<\/p>\n

2. \u00a0The business model is not viable<\/h3>\n

Many tech businesses, especially those based on mobile applications, social media, or on developing a following, have been finding it challenging to develop viable business models. Traditionally, tech businesses built around websites generated revenue from advertisements (ads) placed on their sites.<\/p>\n

However, based on the experience of wildly popular sites, such as Google<\/a>, Facebook<\/a>, Twitter<\/a> and LinkedIn<\/a>, profitability through advertising is not as easy as it seems. Hence, start-ups owners in particular, cannot afford to be na\u00efve or complacent, believing that revenues from ads alone will be sufficient to cover their expenses. More rigorous thinking is necessary, which it is advised should be captured in a business plan, especially since preospective financiers \u2013 even Angel Investors and Venture Capitalists \u2013 would be more inclined to support a start-up that is likely to succeed.<\/p>\n

3. \u00a0Owners have poor presentation\/marketing skills<\/h3>\n

As passionate as you, the entrepreneur, might be about your start-up or your business idea, you can talk (or write) yourself out of funding if you are unable to clearly present your idea or business. Two extremes are regularly witnessed at speaking events:<\/p>\n