I’m back talking about a topic that sounds insanely dull… but i promise you is not.

When it comes to fundraising, the boring work of project planning is absolutely key. Last week I shared why - it’s because most of what we need to do falls into the dangerous "important but not urgent" category in the Eisenhower Matrix.

Avoid hitting a wall here by preparing to handle that danger zone effectively...

Welcome to the second part of our project planning series.

In the first edition, we covered the basics of prioritizing tasks and setting realistic timelines. Now, we’ll move on to refining your planning to keep your fundraising on track -are you well-prepped to handle fundraising bumps and do you have enough runway to hit your goals?

Let’s find out… 

How long does it take to close a round?

Let's first think of an extreme example.  How fast would you be if you were Noah Lyle of fundraising, the fastest in the world (editor’s note: Noah won gold at the Olympics in the 100M dash in a crazy finish in case you don’t follow). Even if you’re the fastest in the world, it’s not like you can snap your fingers and poof—an investor's knocking at your door.  The laws of physics still apply.  

The fastest in the world still need time to close a round…. and you, i’m assuming, are not the fastest in the world

So… how long would it take for you to close a funding round? This is where founders can get ahead of themselves.  It might be the one time that crazy bit of optimism hurts. You assume a quick win so don’t plan sufficiently.

Let's break it down: How long does each step take? How long does it take to connect with an investor? Pitch them? Give them time to decide? And finally, get them to sign and wire the cash?

What would your optimistic guess be for how long a process takes? If you said “2 weeks” that would be about 2 days for each of those 4 steps I shouted above… which assume things like sending an email and getting an instant reply.

So realistically, this won’t be a two-week sprint. Try 5-10x that. When you think of timelines for fundraising, prepare for it to take two-to-six months. It might take longer or wrap up quicker, but if you don't plan for the more likely two-to-six month process, you could face unexpected setbacks.

Recently, I interviewed the awesome founder of Equals.  Bobby is a standout first-time founder with a bunch of advantages. He was head of finance at some major startups, went to Stanford, and had a huge network.

Even with all of those advantages, he kicked off his fundraising prep about 13 months in advance. You might think you can push things to the last minute and figure out how much longer you have before you need to start raising funds, but I promise you, it’s neither fun nor effective to be scrambling for capital with a gun to your head.

Bobby’s approach of starting early is definitely worth emulating. 

Check out the episode.

So now you know you need two to six months for this process. But that only helps if you also know how much runway you have to play with. So, let's spend time making sure you understand what to do here…

Calculating your runway

This isn’t rocket science, but it’s something many founders sidestep because it’s a bit of scary math.

Why do many founders avoid it?

The truth is many founders don't want to sit down and confront the cold reality of their cash running out. It's facing the potential end of your company, and that's not a comfortable feeling. But without this clarity, you can't really plan the rest of your fundraise unless you know what you're working with.

To calculate your runway, assess the cash you currently have compared to your revenue minus monthly expenses, known as your burn rate. This will give you a conservative estimate of how long you can sustain operations without additional funding or changing spend. So divide your total cash by your monthly burn. If you have $500,000 in the bank and you're burning through $50,000 each month, what does that mean? It means you have 10 months before you run out of cash. 

If your runway’s looking short—less than two months—here’s your first move: focus on extending that runway. Nothing else matters until you do. That means making cuts, tightening your budget, and digging deep for any extra funds you can find or revenue that you can generate.

You really can’t start a serious fundraising effort with less than three months of runway, and even then, it’ll be pretty tight. If you’ve done everything you can and still have under two months, you’re looking at a Hail Mary situation. But the absolute first step is to extend your runway.

As you create your project plan, consider your runway and align your tasks accordingly. Include time for fundraising preparation, story refinement, list building, and other essential activities. This holistic approach ensures you're well-prepared for the journey ahead.

Whew. Are you bored to tears yet?

I hope not.  I hope you’re riveted into action 😅

Remember, fundraising is a structured process that requires meticulous planning and execution. As you head into your planning, calculate your runway, list out all necessary tasks, break them down into manageable steps, schedule them on your calendar, and start executing. Think of it as assembling IKEA furniture—follow the steps, don’t lose the screws, and make sure you end up with something that actually stands up 💪

Be chased,
Jason