Why You Need To Know Dating To Raise Funds

Investors spend most of their time trying to source deals. Like sales, these are placed into a pipeline that narrows considerably as it reaches the end stage.

In simplest terms, it looks like dating.

1: Pitch Deck

This is your dating profile. The goal is to look attractive enough as a company to warrant a first date.

2: Initial Meeting

Like a first date, everyone is on their best behavior, dressed well, and prepared to handle any red flags. The founder's goal is to present their company as a significant investment.

3: Meeting the Partners

This is the meeting of the parents stage. While your contact at the firm may be conversing with you via email or phone, the partners will meet you for the first time. For founders, consider this like meeting an entire family with bored siblings. You must win them over to move forward.

4: Due Diligence

As a couple moves toward engagement, they often have the financial talk. This is where everything is uncovered. For couples, it may be a student loan, a repoed car from years ago, or a collection of credit cards. For startups, it is misspent funds, questionable people on the cap table, or a founder who could pose a problem in the future.

5: Offer

Once the investor is comfortable with all the potential problems uncovered, they present an offer. Think of it as an engagement. Like a couple proposing marriage, this, too, can be negotiated to some extent. The real question for both sides is whether they can live with the other party for a really long time.

6: Close

Not everyone who gets engaged has a wedding. The same is true for startups with offer sheets. Sometimes, the firm withdraws the offer, but more often, there is an issue that one party cannot live with. Just like spouses, only a small percentage of startups end up here.