Want to know the skills top founders master when fundraising? These are the skills you’ll need in order to land that funding.
The media can often make it sound incredibly easy and simple to land hundreds of millions of dollars in funds for just about any startup idea.
In reality, many stumble around for years and even have to face hundreds of investor rejections before getting a single check.
It doesn’t have to be that way. With the right idea, team and timing and the right skills, you can be far more confident and successful in startup fundraising, and raise far faster and more efficiently, from the right investors.
Fair or not, getting access to funds for your startup business is far more about your network and who you know, than what you know and your technical prowess.
Just like being an entrepreneur, some may appear to be naturally gifted at networking, though it is a learned and developed skill.
When thinking about the skills top founders master when fundraising there are things you can learn to help you get better at it, even if you are extremely introverted. Then it is about practice. Get out there and keep practicing.
As I mention in my book, The Art of Startup Fundraising, you want to start with those closest to you and friends of friends. Make professional networking a part of your weekly to-do list.
2. Relationship Building
Networking isn’t just about meeting new people and trading contact information. The most influential part is maintaining that connection and building the relationship. That can take effort and investment, but it can pay huge dividends.
There are many ways to do this. It can be regular phone calls and emails. It can be via social media. It can be getting together for coffee, going to sporting events together, having dinner, or sending cards and gifts.
3. Public Speaking
Public speaking is a highly valuable asset when it comes to fundraising. Those with good public speaking skills can come across as confident and passionate and capable. All top qualities that investors are looking for in founders and startups.
Public speaking can enable you to present too much bigger crowds and reach more people in the same amount of time. It is a skill that can be used in online webinars, live industry events, and Ted talks.
Public speaking is one of the biggest skills top founders master when fundraising. Today’s most notable public speakers who draw the biggest crowds admit they were terrified and stumbled at the beginning. Mastering it is a mix of specific techniques and practice.
Pitching may seem similar to public speaking but is a unique skill in itself. You can pitch to big crowds from a stage or on TV.
Or you can be pitching one on one in a conference room, or on the phone. In fact, you are always pitching. Everyone you meet should be receiving your elevator pitch.
It is really a sales skills. Great salespeople are made, not born. Knowing when to defer some of your pitchings to a team member who may already be stronger in this skill set may be a skill of its own. Don’t get hung up on your ego.
Pitching is a one of the core skills top founders master when fundraising. But more than that is mastering the storytelling part. In this regard, remember that storytelling plays a key role in fundraising. This is being able to capture the essence of the business in 15 to 20 slides. For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
Remember to unlock the pitch deck template that is being used by founders around the world to raise millions below.
ACCESS THE PITCH DECK TEMPLATE
5. Understanding Cap Tables
As a founder, you really need to understand cap tables, ownership, voting rights and how raising money affects all this.
Without it, you will be unprepared for negotiations. You’re likely to come out with a far more inferior deal. You can learn more about this in this fundraising training.
While raising millions is great, it may not feel so fantastic if you end up selling your business for billions, and find you barely get anything out of the exit deal due to extreme dilution.
You also need to understand that each investor you bring in and team members you give options to will affect your future potential for raising money.
When thinking about the skills top founders master when fundraising, being able to listen to an advisor and learning from others that have done it before should be top of mind.
6. How To Manage Boards
Once you’ve brought on investors and board members, one of the top skills you’ll need as a founder is to manage your board.
Fail to do this well and it is going to be very hard to run your company and have the outcomes you envisioned. It can make it difficult to raise additional rounds of funding. It can mean missing the most lucrative or last chance M&A opportunities. In the worst cases, they may even remove you from your own company.
Securing and speaking to your M&A advisor early can help you develop these skills. Sometimes the skills top founders master when fundraising is actually provided by other experts with domain expertise.
7. How To Pick The Best Investors
Managing your board well begins with picking the right investors. Targeting the right investors will make pitching and bringing in funds much more efficient.
However, money is really one of the worst reasons to be fundraising. You might need it, but the right investors can offer so much more value than just cash and financing.
Each round will be different. Strategically choosing the best investors at each round will help you get to the next and empower your company to its full potential.
Many entrepreneurs, especially first-time founders find this one of the most difficult skills to master. It is usually their downfall. Not only in fundraising but in product-market fit and sales.
In the reverse, those who are masters of delegation and recruiting give their ventures the best possible chances of success and at the greatest levels.
Fundraising and meeting with investors are consuming. Especially in the early rounds. Delegate everything else so that you can focus on this and nothing else. Delegate sales, design, copywriting, marketing funnels, automation, and so on.
It may take time to really get good at it, but if you truly put the mission and company first it will be much easier. With repetition how you delegate will greatly improve too.
Fundraising may look easy. It can be far easier for founders who are intentional about developing these skills and hiring for them.
For efficiency, you may want and need to delegate or bring in founders and advisors who are strong in these areas so you aren’t held back in key early fundraising rounds. You may take more of a direct role in these things as you grow your team and replicate the skills top founders master when fundraising.