TBC: Fundraising Advantages... Are They Real?

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Hey there. Welcome to another episode of the back channel and today's episode. I want to talk about advantages. And the things that it takes to actually get an investor to commit to a deal. This is inspired by something that I had posted about a memory of a story. And a reaction to a founder who had asked me questions about what my fundraise was like, my fundraise back in. Man so long ago now. Uh, what was it?

2017. I was a masterclass in fundraising. I did a lot of things. Right. I ran a great process. I got through a great outcome. And I had a lot of advantages. One of the main advantages that I had was I was an ex VC that had worked in tech. That had network all over the place. I often tell people, all the people that I talk to you and I ran a full process, a lot of different people.

I could either get to like first degree [00:01:00] or one and a half degrees, not even a full two degrees away. I was just so integrated into the ecosystem. Which meant that I could get a ton of warm intros. I can get my foot in the door and I could make sure that people would listen to me. Now, when people think about that advantage. A lot of people will be like, oh my God. Jason just had $2 million handed over to him. That it was just so easy because of all these relationships that I had that allowed me to get into the door. Now the first thing that I want to clarify for everyone, and this is more of a message to help make sure people don't kill themselves with. uh, jealousy or spite of people that do have advantages, but also leads me to talk about another important aspect of fundraising.

So the thing that I will say is that. Relationships get you in the door. But nothing else. Okay. So I was able to get these introductions. I was able to get the opportunity to [00:02:00] pitch these investors. But it didn't do anything else for me. And those advantages that other people have also don't give them any advantages beyond just their foot in the door.

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At the end of the day, it can be easy to look at this network of, of relationships and. Uh, old boys clubs within venture capitalists and say like, oh, they're just funding people that they know and whatever. But at the end of the day, they're all capitalists.

They're trying to make money and they wouldn't be making money if they just talk to people. And because they knew them, they were going to fund them. They're trying to make money. Okay. So these advantages in these relationships, just get people in the door. This is also an encouragement to all of you, that there are multiple steps to doing this well. Of course, you have to figure out how [00:04:00] you're going to find the people that you need to pitch. And you're going to have to get your way into the door and the opportunity to pitch them, but that is only the first step. You also have to be a great founder that is running a great business that can tell a great story and inspire an investor to want to invest in you.

Now, when I posted this on LinkedIn, a guy that follows me on LinkedIn that engages in a lot of online conversation with me. Responded with an amazing comment that, uh, drew an analogous situation.

He said that. Famous comedians get great stage time, a free round of applause. In two minutes of an audience attention. But beyond that, if they're not funny. It's curtains. They get pulled from the stage and the same thing goes in raising capital for startups.

So getting your foot in the door. Just barely part of the equation. Other people that you see that have that advantage and then get funded, know that there is a reason why they got their foot in the door and why they eventually got funded. Look at that model and make [00:05:00] sure you can match against both of those steps and work towards your goal of getting those introductions, but also telling an amazing story that people will want to invest with. Alright.

I hope that clarifies a few things about advantages, and inspires you to do more. Right. Till next time, I'll see you on another episode of the back channel.

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