I recently announced that my company Astrid raised seed funding from Google Ventures, Nexus Venture Partners, and a number of individual angel investors. I found the process had a lot in common with my previous fundraising and partnership development work in the non-profit world, where I asked hundreds of individuals and organizations to give significant amounts of time and money to make a difference in the world.
Learn to build networks and sell the vision I have heard both prospective entrepreneurs and non-profit fund-raisers describe fundraising as an inglorious and unjust process. They’ll say things like, “It’s easy if you’re well-networked but impossible if you aren’t.” I have often challenged leaders in non-profits that require staff to raise their budgets to take these inequalities into account. Still, I have come to believe that whatever your background there are skills that you can learn and practices you can employ to expand your networks and find prospective financial partners.
When I started raising support, my networks were fairly weak compared to those of many of my colleagues. Rather than being selective, I took meetings with anyone who was interested in our work and found myself speaking at high school groups and junior high groups all around the Bay Area. Over time many of the parents of the students in these groups asked how our work was funded and decided to join my support team. I also discovered that many first-generation Chinese and Korean immigrants were interested in our work, so I had my materials translated into both to facilitate communication with and show respect to the members of these communities. By the time I finished working for the non-profit over half of my support was coming from these communities. However, the benefits I received from this process extended far beyond the funding. So much so that I have even asked those who are independently wealthy and who required no financial support to go through a similar process. Here is why. From my experience, almost every bit of learning you get from networking and selling the vision adds value above and beyond the actual money raised. In almost any organization we need to convince others to buy into our vision, join our organization, or purchase our products. We need connections to introduce us to partners, help us refine our strategies, and to introduce us to potential employees. Whether you are inviting donors to a non-profit or investors to a scalable start-up, I believe the process of getting others on board is essential.
Below are a few ways you could get started:
– Study up and read books like Made to Stick to improve your communication- Understand the interests and culture of those you are inviting as partners. Interview them and listen rather than just thinking about how to pitch them.
– Learn from friends and enemies alike; if others are effective, watch what they are doing and appropriate it wherever you can.- Surround yourself with people who will be brutally honest; they help you quickly identify the weaknesses in your presentations and materials
– Shamelessly ask for referrals for introductions from every current investor/donor. Who else can better advocate for you than those who have already invested?