VC Minute – quick advice to help startup founders fundraise better.
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This is Rich Maloy with SpringTime Ventures, bringing you the VC Minute, quick advice to help startup founders fundraise better.
Raising a seed round is like throwing a pool party. No single investor has enough capital to take the whole round. So that means you’re running around trying to get six to 12 investors ranging from angels to angel groups, to SPVs, to a whole lot of venture funds to commit to you. This is the pool party.
Worse, it’s like a high school pool party where the peer pressure is so thick, you could cut it with a knife.
No one wants to be the first one in the pool. So everyone’s standing around wondering,” is anyone else going to get in the pool? Are you going to get in the pool? I’ll get in the pool. If you get in the pool.”
This is the opposite of FOMO. This is FOLS, Fear Of Looking Stupid. What if I jump in and no one else does? Now I look stupid.
Your job as a founder on the fundraising trail is to throw the coolest pool party.
First, people need to know there’s a party. Second, they need to know the cool kids are coming to the party. Third, they need to know that other people are getting in the pool. Finally, ultimately you need to push them in the pool.
Over the next few episodes, we’ll go through the fun part of this, getting people to show up edging people slightly and slightly closer to the edge of the pool. And ultimately, pushing people in.
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