The truth is that fundraising is hard. Most people try and fail, no matter how great their preparation, their perseverance, or their idea. That’s because there are far more people looking for capital than there are people writing checks, and therefore an entrepreneur needs to do everything possible to ensure they can successfully fundraise.
So with that disclaimer, let’s get to it.
The Short Version
The fastest way to explain the fundraising process is this:
1. Get your company started and build some traction to make your deal look interesting (this is all explained later).
2. Find the capital sources that actually make the most amount of sense for your business right now. (hint: it’s not always a traditional investor)
3. Develop an amazing presentation that blows investors away with your idea, team, traction and preparation.
Companies that successfully raise capital do so because they convince others that their idea is going to be a winner. They do that by demonstrating traction to the right capital sources and proving they have what it takes to actually make a great company.
The Longer Version
Our goal is to make this process a little easier by walking you through the fundamentals, setting your expectations, and identifying what preparation you’ll need to do in order to be successful.
Before you begin raising capital, or even thinking about it, the first step is to get your company started. You’ll need to get incorporated, get a tax-id, setup a basic Web presence, develop some collateral materials like a logo and brand items to look like a real company, and begin putting together your business plan.