Product, Ambition, Leverage: How Y Combinator companies raise money

humbledmba.com

36 points·bradfordcross··8 comments

I am interested in hearing more from YC companies on how they balance the point about stacking meetings (10-20 per week) with being product focused. To me, these two objectives seem to be in conflict, and I don't understand how somebody can stay focused, and lean, while constantly chasing meetings.

What is the secret?

You stack meetings so that you can get your fundraising done fast. If you're doing it right, you'll get enough people ready to go that you'll be done in a few weeks of hardcore meetings. Then you go back to product. This is win-win for you and your investors.

One buyer equals a ripoff. Many buyers equals a market, and a fair value for your startup's equity.

Congrats.

How did you create demand/scarcity/leverage in the leadup to getting your first term sheet?

Warm intros from influentials. YC helped us a bunch, as did our existing network.

The first two (product & ambition) make sense, but leverage is a different story.

While a low burn rate helps, a VC firm has more staying power over time than a startup.

General advice I've heard is that you should be out looking for money well before you need it. Sometimes several months before.

It's going to take many months to go from zero to funded. Deals exist to fall through.

Get profitable. You can do this before taking money.

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