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Yooo it’s hightime we had this discussion. A lot of early stage founders dilute their shares unnecessarily for peanuts. Especially in Nigeria https://twitter.com/chrisjbakke/status/1326549755544002560
Never raise money you don’t need. Only raise what is required at that given time. If you sit on too much cash, it’ll inevitably come back to shoot you in the foot. Also, If the capital is going to have you dilute your shareholdings unnecessarily, you might want to reconsider...
You shouldn’t be raising money during seed/pre-seed for more than 25% Equity. What this does is that it limits the Capital you can raise during further capital raise exercises like your Series A. Only raise what you need and try not to make it more than 25% of your coy...
Furthermore, you’d most likely succeed at capital raise or have leverage during negotiations if you have already built your core team before having discussions with an investor. What does ‘Core Team’ mean you ask? CEO, CFO, CMO & CTO who have faith in the startup and are...
...already collecting way below market salary. No or very few investors will give you money to make strategic recruitments in the business except your POC is out of this world. No investor wants the team to be formed post-Capital cos you’d probably deploy most of their funding..
...towards payment of salaries. I typically include this clause as a condition precedent for startups that I really like. In essence, finding that product co-founder and building an essential team is the first test you should pass before even starting discussions with investors
One more thing... when starting discussions with a potential investor, I think the introduction to your business should be an Investment teaser which is supposed to be a 10/15 page summary of your business. The idea is to gauge interest from an investor before sending a...
...comprehensive pitch that take a deep dive into your economics & technology. Don’t make the mistake of sending your 115 page deck that describes everything about your company to an investor who hasn’t even shown willingness to fund you. Investors get hundreds of deals every...
month and most of us don’t even have the patience to read lengthy decks. Also, most investors won’t sign an NDA. This is IMO one of the pointless things ever.
You never mitigate the risk of someone stealing you’re idea and launching a similar business except it’s a...
You never mitigate the risk of someone stealing you’re idea and launching a similar business except it’s a...
...ground-breaking idea with a patent. You can’t be starting a brick and mortar business and tell me to sign an NDA. I won’t even answer you.
Companies don’t succeed because of ideas. They succeed cos of execution. Selah
Companies don’t succeed because of ideas. They succeed cos of execution. Selah
