Everything I wish I had known about raising a seed round
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Everything I wish I had known about raising a seed round
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Re: Everything I wish I had known about raising a seed round
#2How much equity do you typically give up in a seed round?
Re: Everything I wish I had known about raising a seed round
#3This post is all true. One caveat (which is mentioned in the post): this person has multiple VC’s in his network and knows multiple founders who have raised on nothing but a deck.
Many, many, many future founders are not as lucky.
So, I guess rule -1 is: get to know VC’s, Angels and other previously funded founders.
Re: Everything I wish I had known about raising a seed round
#4My experience is that timing is a huge element. VC groups have teams that specialize in certain areas (biotech, hospitality, crypto, whatever), but those specialties change over time as the business landscape changes.
If your pitch lands in the sweet spot of the kinds of things they are looking to fund right now (and you can back it up with experience/traction/team quality/whatever), you will have a relatively easy time raising money. If your idea is good but the timing isn't right for the VC market and they don't have people that understand your idea, you will have a very hard time raising money.
Likewise, different VCs are experts in different areas (even between big name firms). We met VCs who knew our market extremely well and had a very deep network in our specific niche. We also met VCs where we had to explain the basic premise of our market from zero. Do some research to find the VCs that work in the niche you work to have the best chance of not only raising money quickly, but getting access to a network of people who can actually be beneficial to your company.
Re: Everything I wish I had known about raising a seed round
#5This post is all true. One caveat (which is mentioned in the post): this person has multiple VC’s in his network and knows multiple founders who have raised on nothing but a deck. Many, many, many future founders are not as lucky. So, I guess rule -1 is: get to know VC’s, Angels and other previously funded founders.
Oh yeah, that Figma post all again. 0 to 5M in 3 months, and "how much prep do I need" ... ahaha.
Less "lucky" teams (eg. the other 99.9%) spend more time and end up with not even a million Schrute bucks.
Of course there's also a 0.00..1% that is really lucky, finds something at the right time, with the right framing/context.
All true, but somehow still very different.
Re: Everything I wish I had known about raising a seed round
#6This post is all true. One caveat (which is mentioned in the post): this person has multiple VC’s in his network and knows multiple founders who have raised on nothing but a deck. Many, many, many future founders are not as lucky. So, I guess rule -1 is: get to know VC’s, Angels and other previously funded founders.
Yeah, reading the sentence "Before starting the fundraising process, my first stop was to call up some VC friends of mine and ask them how to get things going" made me roll my eyes.
Rest of the article is interesting, though.
Re: Everything I wish I had known about raising a seed round
#7For anyone reading this advice. The number 1 reason why Matt’s fundraising process went as well as it did is because he has a world-class personal track record. This dwarfs all other reasons by a long way. Quite frankly Matt would have been able to raise with complete air (assuming that his cofounders have similar personal track records).
That’s not to take anything away from Matt. He’s clearly an accomplished individual and his advice is still sound. But he hasn’t included the glaringly obvious reason why he got funded - he was a professor in CS at Harvard and has had a string of prestigious roles in industry.
Re: Everything I wish I had known about raising a seed round
#8How much equity do you typically give up in a seed round?
The bigger question is how much equity do give up for 5mm when you have nothing but an idea?
I don't get it..
Re: Everything I wish I had known about raising a seed round
#9A few things I've learned:
1. SAFEs are convenient if everyone is amenable, but be careful about having SAFEs sitting around too long or with different terms. They're like the Mogwai in the Gremlins films. They're kind and cuddly unless you feed them after midnight or get them wet.
2. Stay in touch with your angels even if they don't initiate. It'll help in tons of ways and they can interpret lack of contact as a sign that you're dying and that they shouldn't think about you anymore. This isn't good.
3. Be careful about any terms (e.g. in side letters) that might allow someone to stand in the way of a priced round in the future. Even if someone doesn't use them to play hardball for terms (they can), it might make things inconvenient and add dangerous delays.
4. Have a lawyer look things over BEFORE you get into priced round negotiations with VCs or you might end up dragging the process out and risking losing the deal because the lawyers find a problem that needs fixing.
5. If you use standard/canned documents, check (3).
Generally all this boils down to: keep terms simple and universal as much as possible, be communicative, and don't let things sit too long.
It's possible to do a priced round without a lead if you have SAFEs/notes sitting around too long. You can use standard documents to minimize legal. It may be necessary to clean up your cap table.
Re: Everything I wish I had known about raising a seed round
#10A few things I've learned: 1. SAFEs are convenient if everyone is amenable, but be careful about having SAFEs sitting around too long or with different terms. They're like the Mogwai in the Gremlins films. They're kind and cuddly unless you feed them after midnight or get them wet. 2. Stay in touch with your angels even if they don't initiate. It'll help in tons of ways and they can interpret lack of contact as a sig…
> 1. SAFEs are convenient if everyone is amenable, but be careful about having SAFEs sitting around too long or with different terms. They're like the Mogwai in the Gremlins films. They're kind and cuddly unless you feed them after midnight or get them wet.
Your analogy is funny but you don't actually explain why SAFEs are dangerous, could you develop?