Don’t use a Banker for Seed Fundraising.
Despite whatever wonderful promises a banker might make — don’t use them for your seed fundraising.
1. Most investors simply will not take a meeting arranged by a banker, because they know the fee structure. I personally delete all emails I receive from bankers about startup fundraising.
2. Bankers take a percentage of the money they help you raise. So these fees reduce the amount of cash your startup actually gets, shortening your runway.
3. The incentive structure is wrong. Bankers want to get their cash payout right now, but that’s very different from focusing on your long term success and maybe an IPO in 5–10 years.
