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Seed fundraising checklist for founders




Contents

๐Ÿง˜๐Ÿปโ€โ™‚๏ธย Fundraising strategy & philosophy

โ˜‘๏ธ High-level to-do list

๐ŸŒฑ Seed stage essentials

๐Ÿ“ฃ Presentation materials

๐Ÿ‘จ๐Ÿปโ€๐Ÿ’ป Data room

๐Ÿ“‘ Documents examples for investments

๐Ÿ™‹โ€โ™‚๏ธ Questions?


๐Ÿง˜๐Ÿปโ€โ™‚๏ธย Fundraising strategy & philosophy

๐Ÿ’ก Fundraising is like sales โ†’ you sell to investors โ†’ you need a big funnel to get conversions
๐Ÿ’ก Great traction substitutes raising money skill
๐Ÿ’ก Key driver for investors to invest is FOMO โ€“ fear of missing out

โ˜‘๏ธย High-level to-do list

  • ๐Ÿ”ฒ Preparation: grow your network (outreach in LinkedIn, give talks, help others)

  • ๐Ÿ”ฒ Collect a list of investors (~200 people)

  • ๐Ÿ”ฒ Pitch materials preparation

  • ๐Ÿ”ฒ Create โ€œEcho chamberโ€

  • ๐Ÿ”ฒOutreach & pitching campaign (1 month)

  • ๐Ÿ”ฒDue diligence (DD) with Data room

  • ๐Ÿ”ฒ Valuation price game

  • ๐Ÿ”ฒ Signature of documents & getting money to the bank account

๐ŸŒฑย Seed stage essentials

  • main round target is hypothesis testing:

  • is there many prospective clients?

  • COGS < X

  • CAC < Y

  • money usage: X sprints for Y money

  • investments strategy: many tickets of $5-50K for up to $500K in total (not one big ticket for $500K)

  • investors focus: target angels & micro-funds (<$100M under management)


๐Ÿ“ฃย Presentation materials

๐Ÿ’ก In all the materials storytelling is king ๐Ÿ‘‘
๐Ÿ’ก Pitch points essentials *(by Scott Kupor retold by Pavel Danilov)*:
๐Ÿ‘‡ Market is incredibly big (so investor can make money) ๐Ÿ’ต๐Ÿ’ต๐Ÿ’ต โ†’ particularly our team can win
๐Ÿฆธโ€โ™‚๏ธโ†’ here is our traction ๐Ÿ“Š โ†’ here is our product vision ๐Ÿ”ฎ
  • ๐Ÿ”ฒ Long deck/story

  • ๐Ÿ”ฒ Short deck

  • ๐Ÿ”ฒ Teaser/One-pager

  • ๐Ÿ”ฒ Blurb

  • ๐Ÿ”ฒ Data room docs

  • ๐Ÿ”ฒ Financials

  • ๐Ÿ”ฒ Bare minimum: financial model with Profit&Loss (PL), Cash-flow (CF), unit economics & how it gets better with growth, valuation

  • ๐Ÿ”ฒ Mature startup: financial model with Profit&Loss (PL), Cash-flow (CF), Balance sheet (BS), unit economics and valuation

  • ๐Ÿ”ฒ Slides to answer crucial & popular questions about your business

๐Ÿง‘โ€๐Ÿ’ปย Data room

๐Ÿ’ก Keep you docs organized

Bare minimum

  • ๐Ÿ”ฒ Incorporation documents (bylaws, certificate of incorporation etc.)

  • ๐Ÿ”ฒ Cap table

  • ๐Ÿ”ฒ Stock purchase agreements

  • ๐Ÿ”ฒ Stock option plan adoption & options granted

  • ๐Ÿ”ฒ Intellectual Property (IP) agreements (Proprietary information and Invention assignment agreement)

  • ๐Ÿ”ฒ Investment docs from the previous rounds (SAFEs, convertible notes)

Mature startup

  • ๐Ÿ”ฒ Corporate records & charter documents

  • ๐Ÿ”ฒ Business plans & financials

  • ๐Ÿ”ฒ Security issuances & Agreements concerning securities

  • ๐Ÿ”ฒ Intellectual Property (IP)

  • ๐Ÿ”ฒ Material Agreements

  • ๐Ÿ”ฒ Employees & Employees benefits

  • ๐Ÿ”ฒ Licenses, Insurances, Taxes

  • ๐Ÿ”ฒ Marketing & Research Materials

  • ๐Ÿ”ฒ Product

  • ๐Ÿ”ฒ Technology & Development

  • ๐Ÿ”ฒ Custom Information Requests

  • ๐Ÿ”ฒ Hardware

  • ๐Ÿ”ฒ Operation Processes & Flows


๐Ÿ“‘ย Documents examples for investments

๐Ÿ’ก Keep it standard, keep it simple. Use YCombinator templates

๐Ÿ™‹โ€โ™‚๏ธQuestions?

Get a copy of the check list


Made by @spanarin

Feel free to ask me anything โ€“ via email (sergey@smartykit.io), on Twitter (@spanarin) or on LinkedIn.

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