10 Mistakes Founders Should Avoid, When Fundraising!

Ryan Breslow is the Founder of 2 unicorns, Bolt and Eco. He has also helped over 100+ founders collectively raise $5 Bn. This blog post is inspired by his Twitter thread with the same subject.


The biggest insight is that fundraising is a game, and if you know how to play, you can do well - Ryan Breslow.

Here, are those 10 mistakes most founders should avoid doing, when fundraising!



Mistake 1: Complicated Pitch

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  • The average VC spends 3 minutes on a pitch deck. Crazy right?

  • Attention spans are thus shorter than ever, but consideration spans are still long.

  • People lean in if they're hooked to you. So how do you hook them?

  • Keep the pitch simple!


Need help in crafting a compelling pitch deck for your startup? Click here.



Mistake 2: Building Relationships Late

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It's hard to build a relationship with someone and ask them for money straight away.

Instead, develop relationships with investors pretty early.

  • Meet up with VCs before hand, discuss your startup, and keep them posted about your progress.

  • When you need to fundraise, hit the ground running.

Register here, to get your startup reviewed by 1,200+ strategic investors.



Mistake 3: Thinking It's a 1-Way Street

  • Look I get it - when founders think like "why the hell would anybody give me money?"

  • Delete that thought!

  • Fundraising is a 2-way street - VCs have to earn the right to be on your journey.

  • Spend as much time picking them as they do evaluate you.



Mistake 4: Taking It Personally

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  • You will hear 100s of No's during this process.

  • It doesn't necessarily mean there's anything wrong with you.

  • A No can be as much about your idea as it is about timing.

  • Be prepared to meet up to 100-150 investors, before you get a Yes!

  • At the end of the day, you only need a handful of Yes'.



Mistake 5: Not Being Authentic

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  • A lot of Founders feel like they have to be something they're not.

  • The best investors can see through that.

  • And honestly - you're going to be with this person for a long time.

  • Show your personality. Be an outlier.



Mistake 6: 1-Toe in, 1-Toe Out

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  • Fundraising is a beast.

  • The Founders that do it the best treat it as a short-term sprint.

  • This will take away time from operating the business. Accept it.

  • You need to give it full focus so you drive to closure as quickly as possible.



Mistake 7: Pre-emptive Celebration

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  • The deal isn't closed until the money hits the bank.

  • Too many Investors - especially in this market - say they're in and then weasel out.

  • Keep the urgency up - every additional day the deal isn't closed is another day it could fall apart.



Mistake 8: Namedropping the Crowd

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  • DO NOT tell other Investors who you're talking to if they are not committed.

  • VCs all know each other - they will check with each other and you'll be at a disadvantage.

  • The best thing you can do is control the information flow and process.



Mistake 9: Hating Fundraising

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If you want to build a venture-backed company, you need to fuel the rocket. Fundraising also makes you a better storyteller - and that is so important in recruiting, hiring, and inspiring. Fundraising is a part of your job as CEO. Embrace it!



Mistake 10: Loving Fundraising

  • What? You just told me it was a mistake to hate fundraising.

  • It is. It's also a mistake to love it too much.

  • Fundraising is necessary, but not sufficient for startup success.

  • Don't ever forget what the real job is!


We hope these 10 insights would have given more confidence to raise funds.

 

Resources:

  • List of 72+ podcasts, covering (almost) everything on startups.

  • Raising Funds? Register here to get your startup reviewed by 1,200+ investors!

  • Stuck at Fundraising? Help is here.

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