How much percentage do you ask for a return on investment? Can I apply but not join the program? Do I need to be incorporated in Singapore?
We answer your top 5 questions on Iterative's deal terms, so you can have a better understanding of how we structure our deals for all companies accepted into the accelerator.
How much percentage does Iterative ask in return for the investment?
We have a standard deal for all companies accepted into the accelerator. We invest up to $500K using a "post-money" SAFE (simple agreement for future equity) in return for roughly 10% of your company.
We don't charge anything in return and are upfront about how much of the capital you're selling. We think transparency wins when it comes to long and productive relationships, so we're upfront with our terms. US$150K should be more than enough to run your company for 5-6 months before you raise your next round of capital either during our demo day or shortly after.
How do I qualify for the US $500,000 investment?
$500k USD investments typically look like companies that are farther along. Examples are they’re past $1M ARR, already growing 5-7% weekly, or have landed or implemented major contracts with enterprise partners.
Does Iterative charge program fees?
No, we don't because it comes at a cost to founders. We work very hard to make our terms founder-friendly and simple because that's what we would want as founders ourselves. We also don't invest in tranches, nor do we have clawbacks.
When would I receive the investment?
We invest upfront. That means it's upon admission, and you don't have to wait for the batch to start to receive the money. We think being accessible is important, so we're always open and invest on a rolling basis. Typically, we'll make an investment every month.
Can I apply for the investment and not join the program?
The short answer is no. We believe that money is the least important thing we do, and we spend a lot of effort and time helping companies.
Here are 3 things we help with:
- Provide Guidance - We help you prioritise, avoid pitfalls, teach you how to think about your current challenges and prepare you for the challenges you will soon face.
- Join the Community - We designed Iterative to be the best founder community in Southeast Asia. Specifically, this means a community of founders in various industries, sectors, countries, and company stages that help each other.
- Introduce Investors - Raising money is a skill you can get significantly better at it if you know how - and we'll teach you how to fundraise.
Alumni have come out saying how much more they value our community and the operational help, rather than the actual investment. If we only invest the money (and not do the program), that just makes us a traditional VC firm. We're more than that - we've made a process to systematically help founders grow. If it helps, you can think of the program as an orientation into our lifelong community.
Do I need to be incorporated in Singapore?
We strongly recommend being a Singapore entity because you'll vastly increase your chances of getting subsequent funding from investors. We've helped all our companies make this transition during the program.
If you'd like to know more about our deal terms, go here.