

How do you raise money for start up? - youyap

I am doing reserch on how people get funded. I read techcrunch everyday and see companies that raise millions of dollars. I also wonder how there do it. Anyone go thru this process before? Can anyone list step by step on how to raise 1 million dollar?
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russw
Nice question, impossible answer to provide. I have raised capital for a few
companies but have found the process different each time. Lets just assume you
have a product/service/technology that has a viable market potential. My first
step is to define the size of the opportunity and my best path to an "exit".
These two components will determine if you begin @ Angel funding, VC funding
or personal credit card funding (or Y combinator:)) If you have a big enough
opportunity and the connection to go straight to VC, congrats. So now lets
assume you don't, and you are seeking Angel money. Here's ONE model......

Get your company as far along as possible without funding, take it to alpha,
beta or public launch if you can.

Build your advisory board and be very good at tracking your key data points
that drive your valuation and prove your business plan.

Identify potential funding resources through every means possible. Every major
city has an Angel Group it seems now. Reach out and learn what the group has
shown interest in and what company's they've invested in. If you think there
is a good mix, use every resource the group offers but avoid the pay to share
your company models (in my experience that is).

Get your pitch down to under 10 minutes, and be unbelievably good at it.
Angels tend to like ultra passionate, company consumed entrepreneurs, because
thats a consistent trait in successful ones.

Pitch, tweak, learn. Repeat process.

If you want to see a good video of Tim Draper discussing how to get funded,
try this link - [http://www.vator.tv/news/show/tim-draper-sings-
fundraising-s...](http://www.vator.tv/news/show/tim-draper-sings-fundraising-
secrets)

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xenoterracide
I like the link.

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rms
<http://www.venturehacks.com>

<http://blog.pmarca.com/2007/06/the_truth_about.html>

Read venturehacks in its entirety and pmarca's relevant posts.

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russw
I agree, v-hacks is a very good blog source.

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babul
If you want to raise $1M you need a product people will believe in and see
value using. Focus on the product. Build as much of as you can without
funding. Then once you have something tangible and working (even in alpha) you
can seek out the investors and they may actually be interested.

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xenoterracide
what about less... me and my co-founder were talking and we were thinking that
really for right now what we'd like is $50-100k between the 2 of us. So we can
work on the project full time, relocate, and get any resources that we will
need.

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drusenko
you can get 50-100k from a few places: either 1 angel (it won't be a very big
deal for them), family, or friends of family.

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xenoterracide
definitely need to go angel hunting soon. I know in my case family and friends
aren't an option. neither have that kind of money (even if I could spread it
out I couldn't work 1000 out of them).

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bigtoga
I smell a rat. It's pretty common for spammers to create an account on public
forums, let it sit for 30-60 days, and then come in and create a generic,
link-bait style post which they later use to post links in (once the post has
been around a while). The advantage is that Google indexes the page, gives it
a high page rank due to the density and good content.

I just have a tough time believing that anyone who reads this site and
techcrunch would ask such a question.

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youyap
I actually need help. This is not a spam. click on my user, I have created my
account over 2 months ago and never posted yet. I submit my start up to
Ycombinator and Techstar this year but didnt get accepted. So I am looking for
help. Techcrunch dont teach you how to get funded, there just tell you who get
funded. This is why I asked. Sometime question may seem obvious. No matter how
much you know, you can always learn more.

~~~
mixmax
Don't worry - we believe you

:-)

