On Friday night I published an inappropriate post. A reader pointed out my mistake in the comments and I subsequently pulled the post. I owe an apology for making accusations without proper due diligence. For that I apologize.
While my methods were unfair, the point I was making is 100% valid. If you are raising capital for a startup, you will run across no shortage of people who *claim* they can help you get funded. It might be in the form of someone asking for equity in exchange for serving as a company advisor. Or, it could be a company like Terem Capital who offers ‘funding’ workshops at $2495 a pop.
As a general rule of thumb, unless the person you are speaking with is a) capable themselves of anteing up cash, or b) has themselves received substantial funding, take all advice with a grain of salt and with NO EQUITY or other compensation.
I understand the difficulties for entrepreneur raising money when they personally have few connections. Under such scenarios, pressure builds to just “do somethingâ€� such as attend a workshop, launch at a particular event, or hire a some “more professionalâ€� consultant. Don’t give in to such pressures.
Venture capitalists and angel investors are professionals. If you are consistently being rejected, it likely has nothing to do with the font used in your PowerPoint or with what persons are currently advising your company.
The only person who can really help you raise money is yourself. If you really need help on your pitch, there are plenty of resources available online. You can also attend free events such as BarCamps or w. You can get feedback at OpenCoffee and if you’re active in the social media conversation, you can easily network your way into at least a couple of meetings. While there are definitely some great events you can attend that you can buy your way into, they are generally the same events attended by the VC’s your interested in. Just ask.
Finally, a good thing to remember is that the best advisors and brokers do their initial work for free. In the VC business, if you introduce a company to a friend, an angel or even another firm, you are winning yourself huge personal bonus points. People make introductions all the time and they get plenty out of it personally. So if someone tells you, “well I could introduce you but I’d really be more comfortable doing so if I had a stake in the companyâ€� — that’s pure BS.
The best people will intro first and get involved last.