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Cheat Codes for Raising Capital from Venture Capitalists

We love founder(s) who can say any of the following:

Mindset 

  • “Not sure, but we’ll get back to you shortly”
  • “We studied all of the past players who worked in this space, and here’s what we learned…”
  • “We accomplished something difficult that most people couldn’t.” Even if it’s not in a business arena–e.g., you ran a mile in 4:30–this shows ambition and focus.
  • “Only the paranoid survive, and we’re paranoid.”
  • “We have a history of being willing to defer gratification. Examples: ____.” Being a founder is not for the faint of heart.
  • “There are some unknowns in our vision. Here’s our plan for researching them.”
  • “We have a history of moving very quickly.” Note this applies in real time. If we meet you over a period of a month, we’ll notice what happens during that month.

Team

  • “We hired a coach to help make us a world-class team.”  
  • “One or more of our past coworkers are joining us in this new business, and working for sweat equity.”
  • “One of our past colleagues / managers is investing.”
  • “We want you to invest because we think you have resources that can address some of our biggest challenges, which are…” 

Experience 

  • “We think almost everyone else in the sector is missing a key insight we have earned, a secret. We earned our knowledge because ____. When we talk about our secret with other industry players, they say ___.”
  • “We built a similar business in the past, and here are our metrics showing how successful it was.”
  • “Our team has more expertise in this niche sector than anyone else.”
  • “We’re a great fit for this market, because ___”  
  • “With the capital we’ve raised to date, we’ve achieved significant milestones.”

Current status 

  • “We need to raise to keep up with demand.”
  • “We have a small small group of customers who are super-passionate about us, and have shown they’ll pay a premium.”

Future

  • “We’re about to hit an inflection point which will dramatically improve our value; we just need funding to get us there.”
  • “We can and plan to achieve profitability without further funding, and here’s a conservative projection showing how.”

 

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