| Throwaway. I don't know how to raise money. What's a first time entrepreneur with a solid technical & business background, tons of experience, a working product in the hands of soon-to-be-paying B2B customers supposed to do to get started raising money? I have a MVP plus product, a handful of beta B2B customers--some decent brand names--and some that will probably convert to paying customers in the next few month--talking about a few hundred to a couple thousand dollars a month per customer. I've read Paul Graham's "How to Raise Money" [0]. I read the same from others' blogs: Don't raise unless you know you need the money. I know I need it to scale and grow quickly.
Still, I don't know how to go about raising it! I've spent years as a developer and product manager. I have a solid MBA. Something a little different? I'm in my late 30's, have a spouse and kids and am leaving a cushy corporate job. How do I go about raising money? Cold-call angles/VC's and ask to meet over a coffee? Go to start-up competitions? Apply to an incubator? I thought about applying to YC but think I don't fit the demographic (age and family) and I don't have a co-founder. How do I start? Are there specific advisers out there that help with this? Some book or blog post I haven't come across yet? When should I start raising money? I've heard I should give myself a 6-month run-way, but I can't put my business on hold while I do that. BTW, having a co-founder is starting to make sense for this one reason now. How much should I raise? I've heard an estimate of (monthly need x 18 months) and I've also read that I should just guess [1]. How do I start? And then what do I do next? 0 - bit.ly/1iSAUvB 1 - http://read.bi/1dqtJcD EDIT: Fixed formatting |
Do a bit of research into the VCs/Angels in your area. Find out who they are, what sorts of businesses they like. Get on angellist. Build a network there. Talk to people. Keep working. If you've got B2B customers and money coming in, focus on that. For most companies, that is more important than raising a first round of funding, assuming you can continue to bootstrap. The more money you have coming in and the longer you go without, the better leverage you'll have with investors, and possibly an easier conversation.
You say you need the money to scale and grow quickly, but are you sure you need to scale and grow quickly? There are definitely some businesses that do need this, but not all. It's easy to get caught up in the excitement and think 'I need money to scale', but what specifically do you need the money to do? Hardware is so cheap at the moment, and you're a developer, so those costs are minor. If you think you need money to scale with marketing, you don't at this stage. Wait a month, or two.
I've started the fundraising dance, and worked for a VC on a few of their start-ups, and I can tell you that it is very time consuming.
As far as getting a co-founder, everybody says to do it, but that isn't so easy either. Start looking.
Basically, my advice would be to network as much as possible, and get as much advice and help as you can. See what you can do with favours and such, without going for funding right away.
See if you can build your business to 10,000 a month. That may mean getting somebody to help you out, and that may mean sharing equity with that person. It doesn't necessarily mean they are a co-founder. Co-founders and employees are very different animals.
Congrats on taking the first promising steps with your new venture. Best of luck.