TBC: Why You Need Deadlines for Your Raise

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Hey there. Welcome to another episode of the back channel. On today's episode, I want to talk about a really important tool in your toolbox to executing great fundraisers.

And that tool is deadlines. Deadlines deadlines, deadlines. These are essential when it comes to elite fundraising, but I think it's something that a lot of founders kind of don't know how to use Anil. Oftentimes get scared of. So, what is the deadline? First simple definition, a deadline. Is a specific date. By which something has to be completed. And it's pretty vague something because you can apply deadlines to so many different things.

We're not just talking about the deadline at [00:01:00] which a fundraise needs to be completed by. We can do a deadline for when to get feedback a deadline. Uh, that we'd like to schedule a meeting by. There are a lot of things that deadlines can be used for in order to push things forward. Okay.

So why do deadlines work in fundraising? A few things. There are a lot of psychological factors. That deadlines play on that sort of make these things much more effective. The first is deadlines, create what's called scarcity. As in, if there is a deadline, it means that whatever you were trying to accomplish no longer exists after a deadline, hypothetically, and that creates a level of scarcity. If someone believes that they won't have something that they already have. And it will go away after a certain date. It will cause them to take proactive actions and what's caused them to move.

These are things that you want investors to do while fundraising. Deadlines [00:02:00] also create a sense of urgency and help the founder grasp the reigns of a fundraise. Get a little bit of control around what's going on. And when you have control over a process, you have the ability to kind of. Gather people together, build their energy together and drive towards a conclusion. I also like making sure that there's a little bit of a power dynamic balance.

You never want to feel like the VCs are calling all the shots otherwise. It feels like. The founder has no other options. And so a lot of signals that we put out there are trying to show everyone who's considering a deal. That there are other options out there. That the founder has a little bit of control over this process because they believe that there are options out there. So applying deadlines. In a polite. but, but forceful way. Shows that somebody has control and confidence in what is [00:03:00] happening. Okay.

So, how do you apply deadlines? Well, Deadlines are. Essential. And one of the elements of fundraising strategy they often talk about, which is calendar density. Calendar density is all about creating a segment on your calendar about two to three weeks where all of your meetings are being scheduled.

And it's one of the first times that you might apply a deadline when talking to investors who are considering investing in your company. As in, we'd like to set up a meeting with you. Our first meetings are going to be between X date and Y date. These are these borders on a calendar or essentially deadlines date by which they will have to schedule a first meeting. It's amazing.

It kind of shows you the organization that it found her house. And again, exerts control and a bit of power over the whole process. It allows you to show that many other other investors are working [00:04:00] within these boundaries or within this deadline. Another benefit of deadlines is that people bump up against it.

So you get to show that other investors are engaging.

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When I think about effective deadline use. [00:05:00] There is. A bit of language that people need to be good at. So. We want to be, we want to be direct and we want to be slightly forceful, but we can't be overly aggressive. And we need to balance that out with both politeness. And a reasonableness. So when we say reasonableness, we mean, well, Does the amount of time you're allowing an investor. To work within, within a deadline.

Does it make sense for how much pressure is around the deal? Does it make sense for how exciting this deal is? And so in order for deadlines to work, remember, you're going to have to run a process. So setting a deadline for one specific person. Doesn't make a lot of sense because they're like, well, if I don't make that deadline, what happens?

Are you going to go with nobody else? So make sure that deadlines are paired with a fulsome process, with a lot of options so that you can be aggressive, but [00:06:00] reasonable. Aggressive, but polite. And set deadlines that. Force people to act, but also, you know, are, are comfortable enough where they can get their work done. Sometimes I like to use. Softer language to allow. Wiggle room for an investor to show their displeasure or show their inability to work within that timeline without having a fully dropout.

So instead of we are going to do this by this deadline, we can say, we expect to close things by, or our plan is to run a process. That starts on this date and ends on this date. Can you work within that timeline? Right? So at least you're giving some boundaries and an ability to flex on the borders on the edges.

Right.

I also want to say that setting deadlines is not always a super uncomfortable thing that you're doing to investors. I always like telling people that oftentimes investors crave deadlines, [00:07:00] because out of all the things that they're processing all the deals and all the opportunities that they're looking at. It's helpful to have some deadlines because it allows them to prioritize it.

I always say the things that they look at are the things that have deadlines. And then everything else. So by giving an investor a deadline, you're actually helping them organize their priorities a little bit, which is something they'll appreciate. Think about how you're going to use deadlines in fundraising, for sure.

But once you start seeing the power of deadlines, once you start seeing people act and give you feedback and set up meetings within timelines that you set because you set deadlines. You're going to start finding different ways to apply deadlines in different areas of business and your personal life. so consider using deadlines within your fundraising process and other areas of your life.

See how it goes. I think you'll thank me later. All right, we'll see you on the next episode of the backchannel

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