This post was written by Aidan Pratt, Atlanta Ventures Intern.
A three step guide to the fundraising process for your startup, based on our experience helping thousands of startups raise capital.
Understanding and executing your startup funding process
Are you thinking of fundraising? Series A, pre-seed, cap tables, pre/post money evaluations, pitch decks, finding the right investor fit, when to raise, how much to raise—it is confusing, right? It doesn’t have to be. We all have different paths in life, and the same is true for your startup: getting acquired, growing exponentially to IPO, or staying stable. You may not even need to raise (like MailChimp).
We’ve seen all types of companies and countless pitch decks. Below are three areas to focus on as you embark on your fundraising journey, plus some of our best blogs and tips on what makes for a good fundraising process.
1. What path do you want to be on? Are you ready for it?
It starts with understanding which fundraising path you want to take (if at all). Fundraising is not a decision to be taken lightly. Some companies may never need funding—you could fund your business without raising formal capital. One thing to consider as you evaluate your path is that you have the right traction where investment growth makes sense.
2. How much do I need and what type?
It is essential to know what kind of capital you need, how much you need, and when you need it. Determining the amount you raise can be tricky, but you have options. When determining the value, ask yourself, “What is my company worth?” Knowing what it’s worth right now and how big it could grow in the future is vital.
- Overview of some main terminologies
3. Where/When do I find investors (Angels/VC firms/Accelerators), and how do I pitch?
Selecting what type of investors you want to engage is critical. This relationship is a long-term partnership, not a daily deal. Then, you’ll want to evaluate when you should begin talking to potential investors, and finally, you’ll want to pitch them well. It’s critical to nail down your primary mission, vision, and values, show proof of traction and use that to leverage why your startup is worthy of investment. Some great resources like Canva.comand Slidebean.com can help you craft beautiful pitch decks.
- Reaching out cold to a VC and what to avoid
- Designing the pitch deck
- Practicing for the pitch and best practices
- Visit Pitch Practice every Friday at 1 pm at Atlanta Tech Village to practice
While this isn’t everything you need to know about fundraising, diving into these three areas of focus will equip you along the way.
Here are some other great Atlanta resources for the startup ecosystem: