Track Interest, Committed, and Invested
In raising a round of funding, most founders focus on the invested funds so far. When asked about the progress, the founder quotes the invested amount and the amount left in the raise. This undersells the traction the founder has. In addition to the invested, also track the interest and...
Prioritize Investor Follow-Up
Startup founders raising funding will encounter a range of investors with varying levels of interest. Founders should prioritize their follow-up and focus on the investors with the greatest likelihood of making an investment with the least amount of work. A lead investor can be quite helpful but will require substantial...
Investors Want Optionality
Investors follow many startups before investing. They stall in making an investment to be certain it’s a good one. They look for additional information about the startup, its product, and market before making a final decision. Investors want optionality. They want to have as many options available as possible. This...
One and Done Is Not Going To Work
In raising funding, the founder will need to follow up with the investor to close. After the pitch, some founders send one email to follow up. The one-and-done approach to follow up will not work. It takes multiple follow-ups and outreach to close an investor. The investor is searching for...
Fundraising Takes Time and Focus
Fundraising is a full-time job. It takes time and focus to do it properly. For some founders, it’s a job within a job. In running a fundraise campaign, the founder should consider it their full-time job. Their startup duties should be handled by someone else for the time it takes...
Why Use Special Purpose Vehicles (SPVs)
Special Purpose Vehicles or SPVs are the use of a legal entity to gather investors into a startup investment, which takes one place on the cap table. This works well when there are many investors with small-dollar investments. SPVs bring many advantages to the founder, the VC fund, and the...
Advantages of a Venture Studio Model
There are several models for running a VC fund. The venture studio model is one of them. It brings additional support to the startup. The venture studio creates a set of startups in a sector with various skills and capabilities. As the startups progress, some raise funding while others do...
Are You Ready To Be a Public Company?
Successful startups have several exit options. Going public on the exchange is one of them. Here is the test to know if your startup is ready to be a public company: Can you provide a 20% annual growth rate for the next five years? This typically requires a stable customer...
The Challenge of Startup Investing
Startup investing is one of the most difficult asset classes to pursue. Information about the potential of the startup is often scarce and always opaque. Some information is available, but the early signs provide only scant information. Investors are torn between the fear of missing out on a good deal...
Understand Why the Investor Said ‘No’
In pitching investors, the founder will hear ‘no’ many times. Without understanding why, the fundraising process can turn into a slog. By understanding why the investor said ‘no’, the founder can turn it into an educational experience. Here are some common reasons why investors say ‘no’. There’s no momentum or...
