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Advertising is a consistently fertile industry for business start-ups. Some driven by opportunity, some by necessity and some by the desire to be your own boss. 

In the creative and strategy sectors, there usually isn’t much of a need to raise significant funds. 

Good brains, great ideas, a black book, boundless optimism and enthusiasm and a computer are often enough. 

It has been even cheaper during this pandemic with nobody needing their name plate on an office door.

However, a huge number of businesses that support, supply or compete with the ad industry have to raise significant funding. 

Most of these are tech-led. They can be communication channels, creative formats, production techniques, research options or delivery systems. 

As examples, in the ad tech/martech space, I currently work with a language analytics business, a programmatic barter business, a chatbot ad format and a digital esports/egames business. 

All of them have needed to raise significant funds to bring their offer to market and accelerate growth.

There are two significant factors in the employment space that drive the number of new tech start-ups:

First, if you ask twentysomethings what their career ambitions are, they will almost always say that they want their own business. 

Twenty years ago, they would have said they want their boss’ job. The impact of the coronavirus on the workplace has only increased this desire to run their own company.

Second, raising money to start or accelerate business growth is now almost a given. It's the model that isn’t questioned. The market has decided. And a lot of that expectation is driven by investors’ money looking for a home. 

Founders often fall into the trap of believing that getting hold of investment funds is easy – that there is a money tree that they just need to shake, and the funds will drop into their lap. 

Raising investment is hard and you need to be very well prepared to get the right deal.

It always seems unfair that at the very point that a young business is at its least experienced, it is negotiating with investors who are very experienced and know how to maximise their returns from a deal.

Here are some things to think about if you are looking for investment:

• Never underestimate how hard it is to raise money. Get experienced help and advice.
• Be as well prepared as you can be. Know your business, your market, your customers, your competition and your strategy.
• Make sure your current shareholders are aligned on ambition and timeframes. 
• Remember that investors only care about one thing: their money.
• Get the best lawyer you can afford. It's an investment not a cost.
• Institutional investors don’t do empathy. Don’t go looking for it.
• Don’t be ridiculous in setting valuations. It's often better to settle for a lower valuation and get better terms.
• Deal “fatigue” is a real issue for hard-pressed founders. It's where investors often get enhanced deal terms. Pay attention and spread the load.
• Don’t believe that you can change a deal after it's signed and agreed. To most investors a deal is a deal.
• During due diligence, the investor will look at you and your business in forensic detail. It's not personal, even if it does make you feel like a fraudulent criminal. Don’t get emotional.
• Never leave it too late to raise money. You lose all of your negotiation ammunition.

There are lots of examples of very successful start-up business/investor relationships. 

In the advertising industry there are lots of businesses that need funding to get them to really succeed. 

It's so easy to get a deal wrong, where an unnoticed, seemingly benign clause hidden in the small print of a document, multiplies in size as a problem as time and future fund raises occur. 

Great preparation and as much experienced support as possible will give you the best chance of a well-balanced deal to take you on your journey. Good luck!

David Pattison is co-founder of PHD and author of The Money Train: 10 things young businesses need to know about investors