[Fundraising for Startups] Lesson 5: There are only two things that make any deal happen.

I had lunch with Dana in Vancouver today and I learned two things: eating by the water is beautiful and you should never order chicken tenders in Canada.

Anyway.

It's funny to watch smart people overthink simple things.

It's easy to get caught up in term sheets, pricing, option plans and all the other BS that comes with fundraising.

Here's the thing... only two things get a deal get done: FOMO and GREED.

...

I'm dead serious.

If you find yourself talking about anything other than business growth with an investor for more than 50% of the allotted time in your meeting, your deal isn't going to happen.

Don't get me wrong: your product, your market, your team and everything else in between matter... but only to the extent that you talk about them and move on.

If you're raising money from someone else, your goal is to build the biggest / best company within your vertical. If you agree with that, then you have to agree that business growth is the only thing that matters.

If you find yourself trying to rationalize your investment opportunity in your investor's mind, it's just not going to happen.

Here's the thing: investing in early stage startup companies is emotional, not rational.

OK, let's quickly talk about definitions:

• FOMO: Fear Of Missing Out. It's exactly what it sounds like.
• Greed. Again, exactly what it sounds like.

• Have a business. We've talked about this already but you need to have some sort of traction to justify a fundraise these days.
• Fundraise full time. You can't half-ass this. Building a company is hard. Getting people to invest in that company is harder. If you're serious about fundraising, you need to keep the company growing and then carve out a month of your own time to setup meetings. If you want to raise $500K, plan on setting up 500 meetings. If you want to raise $1M, plan on setting up 1,000 meetings. That's the mindset you need.
• Keep the meetings tight. The goal of the meeting is to focus on business growth, try to avoid spending too much time on pleasantries and other unrelated things. Don't let the meeting go long -- in fact, try to end the meeting early and casually mention that you need to get back to work. Better yet, casually mention that you have another investor meeting scheduled and you want to respect everyone's time.

I'll be back tomorrow.

-P