I recently hosted a deep dive into fundraising. Presenting it here in podcast form (subscribe on on Apple Podcasts and Spotify) as a Texts with Founders bonus episode. Enjoy!
Timestamps with topics and ideas that might be of interest below. I’ve been told the “Expectation vs Reality” segment (starting at approximately 11:34) was especially useful.
0:55 - Why it's called "What no one tells you"
1:26 - Why fundraising advice is generally not good
2:41 - Julian's background and overview of ODF
4:10 - You shouldn't be good at fundraising
4:45 - Momentum is the main driver of success
5:29 - Customer momentum is the most important type
6:19 - Other types of momentum are less important than customer momentum
7:06 - Should you even be fundraising?
7:40 - Are you fundable?
8:46 - The funding market DOES NOT MATTER
10:02 - Raise on momentum or the dream
11:18 - If you aren't making progress...what are you waiting around for?
11:34 - Expectations vs Reality segment
11:53 - Expectation: It will take a few weeks to fundraise... Reality:
13:26 - Expectation: I'll nail most of these meetings... Reality:
14:30 - Expectation: Fundraising is a full-time job... Reality:
16:44 - Expectation: "I'm taking enough first meetings" ... Reality:
17:31 - Expectation: That went great — they're going to offer a TS... Reality:
18:42 - Expectation: [Trick] will get investors to move faster... Reality:
19:57 - Rapid Fire segment begins
20:12 - How to determine your startup valuation — it's actually straight-forward!
21:00 - Does your valuation match market reality?
22:23 - Start your round raising from angels
22:38 - Top of funnel is essential for a successful fundraise.
23:00 - Get former boss to invest if they work in tech or in your sector
23:54 - Illustration of how angels lead to other investors — Freshpaint example
25:19 - How a $5k investor unlocked half of the round for Freshpaint
25:27 - Reward early backers with tranches
26:45 - RUVs are a way of rolling up small checks to save money and time
27:31 - Weekly Updates — what they are and why they help you build your business and successfully fundraise.
29:20 - AMA: How many investors do you need to speak with for your round?
30:19 - AMA: How do you define a preseed and what traction is necessary? How much runway should I have?
32:22 - Milestones inform how much you want to raise and how much runway you need.
32:41 - Defining a preseed vs seed round
33:43 - AMA: What are some of the key metrics to raise a round?
35:01 - AMA: How do you restart a process after making a bunch of fundraising mistakes?
37:20 - AMA: How do I find angel investors?
37:37 - You should be in SF if you can be if you want to start a company
38:07 - The second best geo to build a company is on the Internet — anyone can be there
38:39 - How Julian met his first investors and customers on X while a music school dropout in Boston
40:29 - Sincere cold outbound on X is surprisingly effective
41:26 - Merge - a club for nondilutive microgrants
41:57 - AMA: is it risky to give early angels a lower cap?
44:50 - Is it worth giving a lower valuation to someone you really want to work with?
45:58 - AMA: Cold vs warm approaches for investor intros
48:11 - Cold is hard because it's a filtering challenge.
49:10 - If you do cold it must be highly personalized and succinct.
50:17 - AMA: Pros and cons of MFN sideletters
51:12 - Link to MFN document
51:33 - AMA: How do I make the most of ODF (to fundraise and otherwise)
53:20 - AMA: Applying for incubators and accelerators vs raising a more traditional round
55:27 - AMA: Things are not going great but we still have conviction on our idea - what's your advice?
55:39 - If you have conviction on your idea when it's not going well WHY do you have conviction?
56:52 - Customers understand before investors do — and most investors will never understand
57:56 - AMA: What tool do you recommend for RUVs?
58:11 - AMA: How to start super small but demonstrate to investors that the overall TAM could be really large
1:01:35 - ODF23 — the place to go to figure out who you're going to build with, what you might build, and who your initial customers might be. IRL in SF
https://joinodf.com
P.S. I don’t think you miss much not seeing the slides, but here’s the full session video with slides if want them:
Other Links / Updates
My conversation with Eoghan McCabe (CEO/Co-founder of Intercom)
If you liked this podcast this you might also enjoy the live session I recorded:
Merge Club + Microgrants
Are you interested in getting a non-dilutive microgrant ($100 - $1k) for your work?
Check out Merge and our Grant Guide.
We just released our Q3 newsletter announcing recent grant recipients working on ambitious projects.
If you’re an experienced operator interested in supporting young (most 13-19) ambitious (highly technical) builders drop me a note — we’re cooking up something special and already have some great people involved.
That’s all for for now.
- Julian
What no one tells you about raising your first round — Lessons from helping launch 1,000+ startups.