Thoughts on startups by investors that
fund them & entrepreneurs that run them

Help with asking for seed funding?

Unfortunately, the reality of entrepreneurship is that raising seed funding is much, much more difficult than you have been led to believe from the press reports about early stage financing. Only one out of every 400 companies seeking funding from venture capital firms actually receives it. And even when trying to raise much smaller amounts of money from individual ‘angel investors’, the odds are still worse than one in 40.

Because the costs of developing a web-based product are much less today than they were even a few years ago, investors tend to expect that a company requesting funding will have accomplished much more than simply a business plan and a wireframe. Today, even the smallest rounds of initial funding typically go to companies that have at least an operating prototype, a Minimum Viable Product, or an actually shipping product which is already generating revenue.

For a good introduction to early stage seed financing which assumes no prior knowledge, you might want to read Bill Payne’s book The Definitive Guide to Raising Money from Angels. It is available as a free online download from Gust at: http://gust.com/en/angel-investi….

*original post can be found on Quora @ http://www.quora.com/David-S-Rose/answers *

Written by David S. Rose

user David S. Rose Founder and CEO,
Gust

David has been described as "the Father of Angel Investing in New York" by Crain's New York Business, & a "world conquering entrepreneur" by BusinessWeek. He is a serial entrepreneur & Inc 500 CEO who chairs New York Angels, one of the most active angel investment groups. David is also CEO of Gust.

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