Angels will also often introduce interesting companies to their own networks. Otherwise, find someone in your network to make an introduction to an angel or VC. If you have no other options, do research on VCs and angels and send as many as you can a brief , but compelling summary of your business and opportunity see Documents You Need below. There are a growing number of new vehicles to raise money, such as AngelList , Kickstarter , and Wefunder.
These crowdfunding sites can be used to launch a product, run a pre-sales campaign, or find venture funding. In exceptional cases, founders have used these sites as their dominant fundraising source, or as clear evidence of demand. They usually are used to fill in rounds that are largely complete or, at times, to reanimate a round that is having difficulty getting off the ground. The ecosystem around investing is changing rapidly, but when and how to use these new sources of funds will usually be determined by your success raising through more traditional means.
If you are meeting investors at an investor day, remember that your goal is not to close--it is to get the next meeting.
Investors will seldom choose to commit the first day they hear your pitch, regardless of how brilliant it is. So book lots of meetings. Keep in mind that the hardest part is to get the first money in the company.
In other words, meet as many investors as possible but focus on those most likely to close. Always optimize for getting money soonest in other words, be greedy 2. There are a few simple rules to follow when preparing to meet with investors.
First, make sure you know your audience--do research on what they like to invest in and try to figure out why. Second, simplify your pitch to the essential--why this is a great product demos are almost a requirement nowadays , why you are precisely the right team to build it, and why together you should all dream about creating the next gigantic company.
Next make sure you listen carefully to what the investor has to say. If you can get the investor to talk more than you, your probability of a deal skyrockets.
In the same vein, do what you can to connect with the investor. This is one of the main reasons to do research. An investment in a company is a long term commitment and most investors see lots of deals. Unless they like you and feel connected to your outcome, they will most certainly not write a check. Who you are and how well you tell your story are most important when trying to convince investors to write that check. Investors are looking for compelling founders who have a believable dream and as much evidence as possible documenting the reality of that dream.
Find a style that works for you, and then work as hard as necessary to get the pitch perfect. Pitching is difficult and often unnatural for founders, especially technical founders who are more comfortable in front of a screen than a crowd. But anyone will improve with practice, and there is no substitute for an extraordinary amount of practice. Incidentally, this is true whether you are preparing for a demo day or an investor meeting.
During your meeting, try to strike a balance between confidence and humility. Do not just walk out leaving things ambiguous. A seed investment can usually be closed rapidly. Deals have momentum and there is no recipe towards building momentum behind your deal other than by telling a great story, persistence, and legwork. You may have to meet with dozens of investors before you get that close.
But to get started you just need to convince 5 one of them. Once the first money is in, each subsequent close will get faster and easier 6. Once an investor says that they are in, you are almost done. This is where you should rapidly close using a handshake protocol If you fail at negotiating from this point on, it is probably your fault.
When you enter into a negotiation with a VC or an angel, remember that they are usually more experienced at it than you are, so it is almost always better not to try to negotiate in real-time.
Take requests away with you, and get help from YC or Imagine K12 partners, advisors, or legal counsel. But also remember that although certain requested terms can be egregious, the majority of things credible VCs and angels will ask for tend to be reasonable. Do not hesitate to ask them to explain precisely what they are asking for and why. If the negotiation is around valuation or cap there are, naturally, plenty of considerations, e. However, it is important to remember that the valuation you choose at this early round will seldom matter to the success or failure of the company.
Get the best deal you can get--but get the deal! One reason safes are popular is because the closing mechanics are as simple as signing a document and then transferring funds. Once an investor has decided to invest, it should take no longer than a few minutes to exchange signed documents online for example via Clerky or Ironclad and execute a wire or send a check. Do not spend too much time developing diligence documents for a seed round. If an investor is asking for too much due diligence or financials, they are almost certainly someone to avoid.
You will probably want an executive summary and a slide deck you can walk investors through and, potentially, leave behind so VCs can show to other partners. The executive summary should be one or two pages one is better and should include vision, product, team location, contact info , traction, market size, and minimum financials revenue, if any, and fundraising prior and current. Generally make sure the slide deck is a coherent leave-behind.
Graphics, charts, screenshots are more powerful than lots of words. Consider it a framework around which you will hang a more detailed version of your story. There is no fixed format or order, but the following parts are usually present.
Create the pitch that matches you, how you present, and how you want to represent your company. Include the most persuasive evidence you have that this is real. Market Landscape - including competition, macro trends, etc. Is there any insight you have that others do not? Team - who you are, where you come from and why you have what it takes to succeed.
Pics and bios okay. Specify roles. Fundraising - Include what you have already raised and what you are planning to raise now. Any financial projections may go here as well. You can optionally include a summary product roadmap 6 quarters max indicating what an investment buys. It is worth pointing out that startup investing is rapidly evolving and it is likely that certain elements of this guide will at some point become obsolete, so make sure to check for updates or future posts.
There is now an extraordinary amount of information available on raising venture money. Several sources are referenced and more are listed at the end of this document. Fundraising is a necessary, and sometimes painful task most startups must periodically endure. Often that will seem like a nearly impossible task and when it is complete, it will feel as though you have climbed a very steep mountain. But you have been distracted by the brutality of fundraising and once you turn your attention back to the future you will realize it was only a small foothill on the real climb in front of you.
It is time to get back to work building your company. Many thanks to those whose knowledge or work have contributed to this document. Of course, any errors are all mine. Please send any comments or questions to geoff yahoo. The term you are looking for is not here? Disagree with the definition? Go to Investopedia for a more authoritative source. Y Combinator Posthaven. Consultado el 27 de enero de Consultado el 9 de septiembre de Consultado el 10 de septiembre de Inc Diario de negocios de Silicon Valley.
Consultado el 18 de octubre de Consultado el 13 de abril de Blog de Y Combinator. Consultado el 17 de junio de Consultado el 21 de abril de Consultado el 22 de abril de Consultado el 8 de febrero de Consultado el 8 de mayo de The Verge.
For many local investors, these valuations seem less bubbly and a lot more digestible than YC companies. However, we moved out of Seattle a week after Demo Day, and gradually found ourselves interacting with the community a lot less frequently.
As there was no continuity, sadly we became quite detached from the Seattle local community. You should either strongly consider building your startup here, or at the very least spend 3 months here. Over the years Techstars has been helping local entrepreneurial ecosystems around the world thrive with its network and resources. If your goal is to join the Silicon Valley tech community as an insider and raise money from Silicon Valley investors at the highest valuation possible, then YC would be the undeniable choice.
If you share the long-term vision of building a sustainable company in a local community and making a long-lasting impact there, then Techstars may be a better option for you. Choosing a startup accelerator is analogous to choosing a university or an MBA program to attend.
You certainly do not have to be a Stanford alum to have a successful career, and going through Y Combinator or Techstars does not guarantee any kind of startup success either.
So go ahead, work hard, make something people want and do more faster! Techstars founder David Cohen is hosting an office hours on Codementor to answer your questions about Techstars and more. RSVP here.
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