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8 things to keep in mind while fundraising as early-stage founders

Published On
February 9, 2023
Read Time
Shanti Mohan

Raising capital in the early stages of the business is a complicated journey. Your investors need to believe your idea and trust your vision for them to align with your business. At the early stage, capital can be extremely important for the product building and upgrading process. 

While fundraising is indeed an important step for scaling up, it is equally important to remember that capital is not the goal behind why one becomes a founder, rather it is the enabler for reaching your goal.  

Over the years, fundraising has been one of the main challenges faced by the entrepreneurs, especially in the early stage. Similarly, investors have a hard time discovering the right startups for investment. 

Apart from this, founders also need to make sure that they are working with the right investor. They too need to know about the investor and make sure that they will be able to add value to the business. Normally, this becomes very difficult and founders don't get the opportunity to question the investors.

This article talks about a few things that early-stage founders should keep in mind while building their business and raising funds. 

Things to keep in mind while fundraising:

  1. Investor-founder fit: When out fundraising, both founders and investors need to be on the same page. They need to know if the selected investors are the right people to move forward with the company’s vision and business goals. Try not to take funds from investors whom you do not find suitable, be it for your stage of investment or for your category of business, or generally if you don’t get the chemistry right. 

  1. Protect thy equity: Businesses need to be very mindful about dissolving equity. Founders should protect their equity and not lose control over the business. As entrepreneurs, one should always be at the top of the data about the business and they should be absolutely aware about how much money is in the bank, burn rate, and revenue. 

  1. You may not know everything: Learn from constructive feedback that comes your way from investors. In the event that investors decline to invest, it is wise to ask the reasons behind their decision. It will help in identifying the gaps in the business and solve them.

  1. Sales is sacrosanct: Founders need to know that sales is one of the most important jobs. Sales do not begin and end with customers. As a founder, you are selling your vision to the employees and investors. 

  1. Team is extremely valuable: In the early stage, angel investors value the team while considering a business for investment. They need to know if a team is resilient because an entrepreneurial journey consists of several highs and lows. Investors need to know if the team will give up in between challenges or are they resilient enough to continue the journey.

  1. Building brand perception: Selling and marketing are two crucial aspects while building. While founders need to sell all the time, marketing is also important because perception matters. One needs to talk about their work a lot more to create the perception about the brand.

  1. Tell your story: Know that storytelling is very important for conveying the message of your journey. Stories about your first customer, first hire, first product need to be told for the users to connect with your brand. Stories make the invisible, visible. It makes the user connect and care about the brand.

  1. Build equity value: Earning is important, but as founders, one should try to focus on earning through the equity value and not through a salary.

How can we help?

The entrepreneurial journey can feel lonely at times. Thus LetsVenture’s special product, Scalix, is aimed at helping entrepreneurs by connecting them with a curated network of founders to learn, connect, collaborate, and grow. In the closed safe network, it enables Founders to connect with their peers who are facing either similar challenges or have found a solution to the same.

Scalix helps founders get access to verified resources and services to remove operational inefficiencies faced by entrepreneurs. Founders will also be able to attend exclusive AMAs, virtual sessions and events with industry experts and learn from their success journey. 

The application was launched keeping in mind LetsVenture’s mission of making starting up and fundraising easier by connecting the right founders with the investors online. 

Through its platform, LV enables the founders to get access to the capital and also solves the discovery challenge for the investors. With founders as the core customers, the investment platform is aimed at making starting up easier for entrepreneurs. 

Want to know more about us?

Apply now to join the community. Scalix is a Founders platform by LetsVenture where we partner with you in your journey from Startup to Scale.