1. Decide when to raise
Raise when you have enough proof that capital accelerates a working machine — not to discover whether the machine works. For most startups that means clear evidence of demand: early revenue, strong retention, or a waitlist that outpaces what you can serve.
Practically, start the process when you have 6–9 months of runway left. Raising takes 3–6 months, and running out of cash mid-raise destroys your leverage. Use the runway calculator to find your true cash-out date before you begin.
2. Size the round
Raise enough to reach the milestones that unlock the next round, plus a buffer. The clean formula: (net monthly burn × target runway) − current cash, then add 15–25% for slippage. Most rounds target 18–24 months.
Do not optimize for the biggest headline number — every dollar is dilution. Anchor your ask to a concrete milestone ("$150K MRR", "product-market fit in vertical X"), and be ready to explain exactly what the money buys.
3. Prepare your materials
You need three things before you talk to investors: a tight 10–12 slide pitch deck, a one-paragraph blurb you can paste into an email, and a simple data room (metrics, cap table, incorporation docs). Optional but powerful: a short financial model.
Your deck should tell a story in this order — problem, solution, product, market, business model, traction, go-to-market, competition, team, and the ask. Use the pitch deck template to build it.
4. Build your investor list
Target investors who actually fund companies like yours — right stage, right check size, right sector, and ideally right geography. A focused list of 60–100 well-matched investors beats a spray of 500.
Sort the list into tiers. Warm up your process on tier-3 (lower priority) investors so your pitch is sharp by the time you reach your dream leads. Track every conversation in a simple CRM or spreadsheet.
5. Run the outreach
Warm intros convert far better than cold — map your network to your target list first. Where you must go cold, keep it to 4–5 sentences: what you do, the traction proof, the ask, and a clear next step.
Run the process in parallel, not sequentially. Batch your outreach so first meetings cluster in a 2–3 week window; this creates natural competitive tension and lets you compare terms rather than being pressured by the first offer.
6. Handle valuation and terms
Valuation is set by demand, not a formula — but you should walk in with a defensible range based on comparable rounds at your stage and traction. Most early rounds use a SAFE or convertible note with a valuation cap; priced equity rounds come with a full term sheet.
Look beyond the headline valuation: the option pool, liquidation preferences, pro-rata rights, and board composition all matter. Model how the round dilutes your cap table before you sign anything.
7. Close the round
Once you have a lead and a term sheet, momentum is everything. Set a deadline, get verbal commits from your other conversations, and move fast to signed documents and wired funds. Deals die from delay.
After close: send a warm update to everyone who passed (today is a no, not forever), onboard your new investors, and get back to building. The next raise is won by the metrics you produce between now and then.