4 ms·
The simple rule is: do it as late as possible. The longer you can delay fund-raising, the less of a share you'll be giving up (or the more money you'll be gett
by swombat 17y ago
The simple rule is: do it as late as possible.
The longer you can delay fund-raising, the less of a share you'll be giving up (or the more money you'll be getting for it), and the stronger your position (presumably). Some businesses raise money on an idea. Others raise money once they have a product with traction. Others never raise money at all. None of those approaches are wrong, but the cost of funding definitely decreases if you wait and decrease the risk on the table.
- cperciva 17y agoThe simple rule is: do it as late as possible. I'd add a rider to this: Raise money as late as possible, but no later. Yes, the longer you wait before raising money, the better the deal you'll usually get... but only until you reach the point of "we need to raise this money or we're going to go out of business". As PG has said on several occasions, the term "angel" is a misnomer; they're sharks who can smell blood, just like any other investors.
- Murkin 17y agoI was wondering what is the practical norm. Perhaps some places where there is research on the subject. Trying to figure out what is the average stage Web start ups raise. Before or After product on market ?