Fundraising is one of the most brutal aspects of startup life. There’s nothing like needing capital—and asking for money—to strip the glamour right out of following your dreams and solving problems. Many startup founders find themselves in unfamiliar territory when it comes to fundraising; it doesn’t feel natural. Additionally, founders are taken aback at the countless hours they need to dedicate to fundraising. It’s not a task you can just ‘check off your list,’ and it can take many months. And the more you spend on fundraising and tweaking your pitch deck, the less time you’re spending actually working on your venture.
Plus, throughout the fundraising period, you likely battle waves of insecurity. Is your startup appealing enough? Do you have what it takes? Will you get funding before you run out of money? Who can you trust?
Follow these tips to come out the other side in one piece.
Count on your network.
Find a shoulder to cry on (or vent to, or bounce ideas off). Fundraising isn’t a time to become a recluse. You’re going through a rollercoaster, so turn to others who are going along for the ride, too. Better yet, find those who have been there themselves. Hearing others’ stories will not only make you feel like you’re not alone, but a different perspective will also show you that things are never as bad as you thought they were.
Get real about who you are and aren’t.
We’re not saying that you aren’t your own form of Super Woman. But you’re not perfect, and investors know this. So, stop pretending you are! Be candid about your weaknesses—and how you’ll hire rock stars to compensate. Be honest about your competitors and the gaps in your product or business model. Investors want to work with honest entrepreneurs who will become partners. They’re looking to build a business with you—not invest in something that has already been figured out.
Find time for you.
Yeah, yeah. Easier said than done, we know this. But honestly – your health and happiness come first. The world will keep spinning if you take time out for that yoga class, happy hour or lunch with friends. And you’ll probably find that you’ll be a lot more productive, too.
Ask for investor references.
Unfortunately, not every investor is a good egg. We wish we could tell you otherwise. Just like any other working relationship, ask around before you dive in. References are a no-nonsense way to find out if investors are all talk (or a nightmare to work with). Talk to several startups that are in the investor’s portfolio before signing on the dotted line. If they shy away from providing references, pay attention to that—and walk away.
Try not to obsess.
You’re going to get feedback. LOTS of feedback. Change that slide in your deck to this or that. Open with this story. Call so-and-so. This is a good time to remind yourself that you can’t please everyone, and remember, you’re in charge. Feedback is just that: feedback. There are no set rules. Sure, make some changes and accept some feedback but try to not obsess over it.
Go in with low expectations.
Makes us sound like a real downer, huh? In other words, know that you’re unlikely to get a check after your first meeting. We’ve spoken with founders who have gone through hundreds of rejections to get to their “Yes” moment. If it was easy to get funding, everyone would get it. Go into the process knowing you have your work ahead of you, and that’s okay.
Enjoy the journey
This goes beyond fundraising, it’s for your entire startup experience. Try to enjoy the ride and live in the moment. You’ll reflect on it one day and share your own sage advice with other entrepreneurs. And when you do it the next time—for a second round, or for another startup—you’ll be all the wiser.