“So, what do investors really want? In asking this question, it’s often easiest to first address what they don’t want.” The amount of funding should have a built-in cushion for any overages as well as a budget for marketing to raise more funds. The best place to start is to create a business plan that incorporates your fundraising plan as a way to ensure you meet your key milestones. Once you’re ready to perform fundraising, remember to do everything that would make it successful, such as making connections, marketing, proving yourself and the product as well as having the right mindset and expectations. This puts you in a stronger position in terms of fundraising and negotiating, as well as building investor confidence in terms of minimized risk. If you really want to raise capital for your startup, you can apply a better approach to this: build your product and service first and then build some traction so that your business will keep running regardless of additional funds. But from an investor’s standpoint, this actually poses a significant risk. Typically, entrepreneurs and opportunists view fundraising as an opportunity to get someone to invest in their dream business and make it a reality. “Before rushing into preparing pitching materials, meeting investors, and hammering out funding terms, it is critical to get your mindset, expectations, math, and strategy right.”
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