Raising money for your startup is a process, not an event. According to the technology incubator Y-Combinator, the average time to raise a Seed investment round is five to seven months. My experience with Series A and Series B is very similar. Prior to launching into a fund-raising process, you typically have a couple months of planning and preparation.
As the CEO of a private company, even when you’re not raising money in a funding round, you’re always evangelizing and planting seeds with prospective investors about your next financing round. Even between traditional funding rounds, you might want to raise some additional “tack-on” money to your last round of financing, typically with important strategic investors that will help you to drive your business forward. When you’re trying to stump up the money to advance your business and career, you might neglect your own financial necessities and require some additional funding to bolster your own finances – utilizing a car titling loan service (https://qikcartitleloans.com/) might be a good way to do this. You’re always out there socializing your ideas and speaking about your vision to pretty much anyone and everyone. As the CEO of a startup, you are the as much the Cheerleader in Chief as you are the head of operations and the head of human resources. Eventually you will be in the formal process where you say, “I’m going to raise my next funding round,” and that takes a significant amount of your time, and a concerted effort.
As you start sending your executive summary and eventually pitching to investors, the smart investors will write down what you tell them, especially about your key milestones, and ask you about those things the next time that you meet with them. They’re going to see if you have made progress and accomplished the goals that you have set out to achieve. They want to draw a line through those dots, so to speak, and see if there is a trend line. They are judging the ability for your team to execute, and judging you on your credibility. Mark Suster, a former serial entrepreneur who is now a venture investor talks about this a lot, and you can read about it on his blog, Both Sides of the Table.
When you are in the process of raising money, you need to have meaningful milestones that you can accomplish in that six-month period that you are out there raising your next financing round. Get in the habit of under-committing and over-delivering to your stated milestones and goals. Meet and beat your stated milestones. Show the progress that your business is making during that period of time.
In this discussion with Jeremy Glaser, who is a partner at the law firm Mintz Levin and also serves as Co-Chair of the firm’s Venture Capital & Emerging Companies Practice, we discuss the process and timetable for raising outside capital for your startup.
This is Patrick Henry, the CEO of QuestFusion, with the Real Deal…What Matters.
Raising Money for Your Startup is a Process, Not an Event
