Today, we’re talking about the dangers of letting your inbox govern fundraising.
Just because an investor wants to meet with you, that doesn’t mean they’re the right investor for you, right now. For example, if you pitch at a demo day intending to raise a pre-seed round of $500k to $1M, you will still get a lot of meeting requests from large VC firms who usually write $5M+ checks.
You can take a few of those meetings but stay focused on getting meetings with investors most likely to say yes. I often meet founders who have done 50+ meetings but raised no money, the cause is usually being focused on the wrong type of investor for their stage.
Fundraising isn’t just about sheer volume of meetings, it’s about the right meetings at the right time.
Today, we’re talking about Imposter Syndrome. Almost all founders suffer from this at some point.
There is a voice in *everyone’s* head saying you’re not good enough, you don’t deserve to be here. If you don’t believe me, read the interviews of the most successful people, they will often concede to these same emotions. You’re not alone. Imposter syndrome tends to occur across several spectrums like. gender, education, experience, race and religion.
Now the data we have clearly shows these biases both exist and have an impact but when you feel like an imposter, for any reason, I urge you to take a moment and reflect on your past work and results. I think you’ll be quickly reminded of why these wonderful opportunities are before you now. This is your time.
Most entrepreneurs struggle while fundraising as it’s an extremely competitive process. Here’s what to do when you find yourself in a tough position raising money.
What: Make sure you’re doing ~15 meetings a week, and stack your meetings together to the best of your ability. This means, over the course of 6–12 weeks, you should expect between 100–180 meetings to complete a fundraise.
Why: Around 90% of your investor leads will result in a no and most of the yeses tend to come at the end of a process. This high rate of failure is solved by simply doing more…
Today, we’re talking about pricing, specifically entrepreneurs tend to price their product at $500, $700 or $900/month. If you’re charging $500 or more a month, you might as well charge $1k.
This is because the approval process at most companies will be the same for $500/month as it is for $1k/month and everything in between. Will customers care? Probably not.
In order for your customer to invest a bunch of time and risk their data with your startup, they have to be expecting results worth a good deal more than $500/month.
Today we’re talking about whether or not to fundraise. Just because you can fundraise, doesn’t mean you should.
Even if investors are desperately trying to invest in your company, remember investors are not the same as customers. That capital does not automatically mean growth. In fact, any fundraising process is a huge distraction from customers and growth.
If you have 1 year or more worth of cash, then focusing on your business is almost always a better use of your time than talking to potential investors.
Today, we’re talking about distribution partnerships. In almost every case, partnerships don’t work for startups. They just waste a lot of time.
If you’re hoping to find dozens or even thousands of users through a partnership, you are heading for heartache. The business development group at a big company will take months to process a deal with you and the deals very rarely even close. When they do close, the results are ultimately disappointing.
Unsurprisingly, nobody is going to be as good at selling your product as you are, plus it’s really hard to provide a great experience to customers without a direct relationship. Partnerships interfere with both., so go direct!
Today, we’re talking about user reactivation tactics.
Many of your early users will have a tough experience on your brand new product. When you want them to give it another shot, it’s sometimes difficult to get their attention. Here’s some common tactics.
1. Send a personal email. Thank them for their time and feedback, highlight the fixes you’ve made in line with their suggestions and offer a call to walkthrough the product again if needed.
2. Offer discounts. Tell old inactive users that as an early user they can get a discount on your newly updated product, but they must act soon.
3. Account deletion. Warn old customers that their account will be deleted if they don’t login soon, usually you’d also highlight an incentive: e.g. login this week and receive a free month of service.
Today, we’re talking about comparing your fundraising round to other startups. This is a dangerous game.
It’s tough to read and hear about people raising huge amounts with minimal progress, when you’ve been toiling on your business with your bare hands without recognition. But that comparison is the enemy of progress — there are dozens and dozens of reasons why some rounds are raised more easily than others and it’s unlikely to be worth the detective work.
Tough fundraising rounds are something every entrepreneur goes through at some point, it’s a rite of passage. If you exclusively focus on building a great business, then eventually investors will be chasing you.
Comparison won’t solve your current problems, it will only increase your own mental obstacles.
Today, we’re talking about announcing funding to raise more money.
This is one the best tactics for raising funds, because once your round is public you will suddenly get a rush of interest from both new investors and many investors you spoke to in the past.
If you do want to use this momentum to raise more, there’s 3 moments where it can be very helpful:
1. Raising on top of a recently closed round. Here you would entertain inbound interest to raise a little more at a slightly higher valuation.
2. Raising a bridge. The capital from your previous…
Today we’re talking about basic etiquette on work calls. I know we’ve all been locked down for a year now but that’s no excuse to start saying whatever you please in professional settings. I’m constantly amazed by the things I hear on video calls. This is not to say I’m perfect — far from it — but here’s some basic guidelines to avoid making others feel really uncomfortable, so they want to keep working with you:
1. Don’t make comments on people’s appearance. Remarks like “Oh you look tired” or “I love that you keep changing your hair” are not…