I’ve always wondered why funding begins with fun. Those three letters. F. U. N. Fun. For entrepreneurs, seeking seed capital means meeting with numerous VC firms and sometimes dozens of angels… fun? Telling the same pitch over and over again… taking time away from more immediately impactful endeavors like recruiting and customer development… the endless follow-ups and inevitable radio silence… fun? And then there’s hearing “no” constantly – perhaps that’s why funding ends in “ding,” as it’s the repetitious sound of hearing reasons for why not, instead of why.
Maybe fundraising isn’t supposed to be fun, after all. But that doesn’t mean it can’t be productive beyond obtaining the capital itself:
- Running a great fundraising process involves crafting real story and not just a pitch. This end-result can take additional time to develop, but having completed it, it can be beneficial in more than dealing with just potential investors. Having a crisp story about the vision behind a business can be leveraged multiple times with other constituents to effectively reach customers, partners, press, and even potential acquirers with the right communications message.
- Fundraising encompasses trial-by-fire circumstances which almost always necessitates professional development. Unless Sales just runs in the blood, running a fundraising process will naturally hone those skills. These soft-skills of persuasiveness undoubtedly make one a better leader.
- A process which is inherently about meeting people… provides an excuse to meet people. Fundraising is about evangelizing a vision. Along the way there will be encounters where the story resonates in conjunction with a real personal connection. Sometimes these people don’t become investors, but rather than quickly moving on, these people can be co-opted into useful allies to help in other ways. Introductions to customers, long-term advisors, business development partners can result from the fundraising process, as those early conversations turn into real relationships.
Yes, often the best part of fundraising is the end of it. That’s the fun part – getting back to spending 100% the time building a company. But there can real benefits that come out of a fundraising process if you’re proactively seeking them as a by-product beyond just adding cash to the bank account.