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Sharing a thread on common fundraising mistakes. I feel strongly enough about this that whenever I complete a new investment, one of the first things I do is to find time with the founders to walk through this list. The next raise is just around the corner. Be prepared.
1/ Don't innovate with fundraising. The opportunity for investors should be evident in the company and product you are building. That is enough to get investors excited. There already is existential risk in the formation of any new company without introducing novel structures.
2/ Never negotiate before you have a term sheet. Be disciplined. Set the hook and wait for commitment bias to kick in. It will work in your favor. Investors hate to lose out — especially after their partners have told them to go win an investment. Play it to your favor.
3/ Never tell a prospective investor your price expectations. At best, doing this will set a ceiling on your valuation. At worst, something too high will scare investors away before they make an offer. If asked, the best answer is “we’re expecting a normative valuation.”
4/ Avoid telling an investor that you are “looking forward to getting things done so you can get back to product.” Investors know that. But a CEO's two primary responsibilities are to get cash in the bank, and to get the right people in the seats. You are a CEO, not a PM.
5/ The deck matters. Polish matters. Practice matters.
6/ Do not schedule any meetings unless you are ready for a full partner meeting. See #5.
Some more details and my full post here: https://medium.com/upside-partnership/fundraising-commandments-f00275b4d038
