Thread by @gaganbiyani

Advanced Fundraising Strategy:
For most, fundraising is a chore. These days, more companies are fortunate to have competitive rounds.

What do you do when you have options? How do you optimize a competitive round?

@wes_kao and I had options... Here's how we approached it.

👇🏾

We named our priorities up-front:
1. Involve investors who backed us in the past
2. Find a Lead who would help raise the A
3. Leverage Lead + large syndicate to create traction (our market is aligned with this strategy as many investors can be instructors or help promote courses)

To make room, we had to raise $4M. If we raised less, we'd have to exclude too many people. If we raised more, the company would be over-valued or over-diluted.

I do not believe in having a valuation over $25M for a pre-seed company. Too hard to beat those expectations.

I asked my fave Series A investors and founders who the best seed fund partners were.

3 people floated to the top. If they give permission, I'll publish them later.

These funds differentiate on:
- Founder-friendliness
- Brand
- Services

Cold e-mail only. I hate warm intros; they are a waste of time and reinforce elitism.

So if the partner didn't respond cold, I probably wouldn't have met them.

Bill did. So did the other 2. We were lucky.

Line them up.

I made a big mistake and had disjointed timing. It almost killed our round.

Fund A I met in T-10 weeks. Too early; lost momentum by partner day.
Fund B I met T-1 week. Way too late; couldn't build enough rapport.
First Round I met T-3 weeks. Goldilocks timing.

Ideally, you are highly regimented about your timing.

Week 1: All first meetings.
Week 2: Second and third meetings.
Week 3 Monday: Partner meetings.

- Share timeline along the way to create momentum.
- Never over-state your funding traction.
- Do not over-rush investors.

Heavily reference check. (5-10 calls with current PortCo CEO's.)

B/c of active relationship, they won't say bad things so you must read b/w the lines.

These are unlikely to disqualify an investor, and more about knowing how to use them best.

Then reached out to past friends such as @simonrothman + @Maidenberg who backed me at Sprig and @rfradin + @bubba who backed me at Udemy.

Life is a long-term game, and I believe strongly in playing it with long-term people. (thanks @naval)

After that, we 100% focused on people who would add unique value. We grilled investors on what they are willing to do and asked them to make written commitments. Codified these commitments into an email.

Each investor provided written confirmation of their commitments.

Examples of commitments:
- Agree to teach a course on platform
- Market us on Twitter or via Email list
- Interview our product co-founder or first engineers
- Do bimonthly 45 min calls with us

Also asked them to follow us on Twitter + agree to read every single investor update

When pitching, we used a deal memo to save time.

A 5-page doc that tells what the company does and why. 30 min calls with prospective investors.
First 15 min: Q&A for us.
Second 15 min: Q&A for them.

Extra call when necessary.

Important to have diversity. Not just race, sex, and geography.

Also diversity of:
- expertise (product, growth, engineering)
- personality (cerebral, tactical, positive, critical)
- fame (too many famous names are a waste; need people who are up-and-coming to actually dig in)

There's a huge difference in mentality of angels who are from pre-2015 era. New school angels are far more willing to do work and understand what that actually means.

We decided to have a mix. Old school investors have wisdom you will need at critical moments.

We got everyone's text and WhatsApp. Already, that has increased my engagement by 4x.

We created a WhatsApp group of our investors too. Still trying to figure out how to use it, but will keep you posted!