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How much money should I raise?

When deciding how much money to raise as an early-stage startup founder, it's crucial to focus on securing enough capital to reach your next significant milestone rather than just chasing a large round.


Consider the key objectives: building a minimum viable product, acquiring your first customers, or proving your business model.  Align your funding with these goals, ensuring you have a buffer for unexpected challenges.


Remember, raising too much can dilute your ownership and put unnecessary pressure on growth while raising too little can leave you stranded before reaching critical validation points. Aim for just enough to fuel progress and demonstrate traction, making your next round easier to secure.


We are curious as to what you think. Any advice for your fellow founders?


Startups.com Acceleratorposted 20 days ago

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Ed Kang

Here's how I approach it:

  • What is the least money I need to generate revenue and never raise again?
  • If I have product-market fit, I generally target an 18-month runway, but that is only if I have PMF and am focused on hyper-growth and the next round of funding.
  • My primary goal is to raise as little as possible. The fewer investors, the better for us and my mental health.
  • If I need to raise money, I sell only 20% of equity every round. If the investors want more, I get more traction for a better valuation.

Feel free to reach out to me if you have any questions!

Reply20 days ago