Startup Funding Espresso -- Milestone the Raise
Milestone the Raise Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing. Founders often want to compress their fundraising into one round for the sake of efficiency. While this may sound like a good idea, it\u2019s actually an expensive one for the founder. Raising too much money in the early stages will cost the founder equity dilution. The valuation of the startup is low at the beginning and will rise with more products built and revenue generated. Raise a small amount upfront to get the business going such as $250K. If you try to raise less than $250K most angels and venture capitalists will not consider this enough to build something meaningful. Take your overall fundraising and break it into smaller milestones such as $500K for a seed round. It\u2019s often the case that you will need to raise another $500K a year later which some call a seed plus round.\xa0 It\u2019s still seed funding and comes at the same terms as before. But it\u2019s easier to raise because you broke a $1M raise into two milestones. This strategy lets you raise funding and then work on the business. For the next round, you\u2019ll need some time to build the product and close customers. A rule of thumb is it takes one year to raise $1M.\xa0 A $500K raise will come in closer to half a year. When you raise funding it should be a full-time job.\xa0 The key here is it doesn\u2019t have to be a full-time job for the entire year. \xa0 Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding. Let\u2019s go startup something today. _______________________________________________________ For more episodes from Investor Connect, please visit the site at: \xa0 Check out our other podcasts here: \xa0 For Investors check out: \xa0 For Startups check out: \xa0 For eGuides check out: \xa0 For upcoming Events, check out \xa0\xa0 For Feedback please contact info@tencapital.group\xa0\xa0\xa0 Please , share, and leave a review. Music courtesy of .