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Yes, but how is that a "friends and family" round if none of it is raised from friends and family? EDIT: If you assume your friends and family can each spare $

Yes, but how is that a "friends and family" round if none of it is raised from friends and family? EDIT: If you assume your friends and family can each spare $500 (which given a median household income of $51,000/year or $3,500/month after federal taxes... Maybe half the U.S. Population in a given month can spare that after rent, food, childcare, auto, and debt repayments.) then you need to get 3000 "yes"s to get to 150k. At a 20% yes rate, that means you are asking 15,000 people for money. It makes far more sense to ask people in the upper decile, who make $145,000 per year of household income and who might have some investment income that they can throw at you. Alternately, to raise from people who regularly invest in early-stage businesses. If you don't have any such folks in your social circle, you are going to be busting your ass and trying to make cold intros.

pbreit 11y ago
2-3 resourceful founders should be able to find 3-15 people to kick in $5-50k each. A friend could be a former boss, a customer, the owner of the local coffee shop, a mentor, a classmate, a teacher, whatever. Don't start quoting average incomes and such. This is not about average. If you really want to talk about average, the average coffee shop, pet store, hair salon, restaurant, raises $150k.
- afarrell 11y ago
  All those businesses have well known models and physical assets that can act as collateral for a bank loan, possibly through the SBA. > This is not about average That is my entire point, that you are speaking from not from the perspective of a person whose connections are of average wealth. If you have a close enough relationship with that many people who have 10k (that is, 2 months pre-tax income for most people) they can just put into a highly risky venture, you are starting from a position of economic privilege: wealthy people trust you with their money. Is it possible to build a consulting practice and thereby build relationships with people who will then be confident in your ability to execute? Sure. Is it possible to go to a college with wealthy professors and inordinately impress them? Sure. It is possible in the United States to work yourself into a higher class. All I'm saying is that being able to collect $150k from your connections certain things from your social position.
  - pbreit 11y ago
    I don't doubt it's easier but if 2-3 co-founders not able to round up $150k from your network to start a business then you are not cut out for such a thing. Building a startup basically consists of constantly persuading people to do things. You have to be able and willing to do this without tossing out the "woe is me" card.
    - afarrell 11y ago
      They weren't tossing out the "woe is me" card. They were pursuing an option for raising money that you think is too hard.

pbreit 11y ago

2-3 resourceful founders should be able to find 3-15 people to kick in $5-50k each. A friend could be a former boss, a customer, the owner of the local coffee shop, a mentor, a classmate, a teacher, whatever. Don't start quoting average incomes and such. This is not about average. If you really want to talk about average, the average coffee shop, pet store, hair salon, restaurant, raises $150k.

afarrell 11y ago
All those businesses have well known models and physical assets that can act as collateral for a bank loan, possibly through the SBA. > This is not about average That is my entire point, that you are speaking from not from the perspective of a person whose connections are of average wealth. If you have a close enough relationship with that many people who have 10k (that is, 2 months pre-tax income for most people) they can just put into a highly risky venture, you are starting from a position of economic privilege: wealthy people trust you with their money. Is it possible to build a consulting practice and thereby build relationships with people who will then be confident in your ability to execute? Sure. Is it possible to go to a college with wealthy professors and inordinately impress them? Sure. It is possible in the United States to work yourself into a higher class. All I'm saying is that being able to collect $150k from your connections certain things from your social position.
- pbreit 11y ago
  I don't doubt it's easier but if 2-3 co-founders not able to round up $150k from your network to start a business then you are not cut out for such a thing. Building a startup basically consists of constantly persuading people to do things. You have to be able and willing to do this without tossing out the "woe is me" card.
  - afarrell 11y ago
    They weren't tossing out the "woe is me" card. They were pursuing an option for raising money that you think is too hard.