Fundraising & the death of productivity.
One day, it dawned on us: why were we letting someone else determine whether we would be successful? It’s not that we were waiting for someone with a magic success-wand to wave it over us, but we were waiting on someone to give us money, which we had decided was the key to moving forward and becoming successful.
After months of being completely distracted (from what we should have been working on) by the prospect of finding an investor, we simply stopped. It may prove to be the best decision we’ve made to date.
You see, while we were spending countless hours on our pitch deck, then a revised pitch deck, and our proforma, then another version of our proforma, then yet another version of our proforma, then a condensed proforma, then...well, you get it… We were not selling. We were hoping to gain investors with our solid idea, highly-qualified and dedicated team (did I mention, awesome?), and a little, itsy-bitsy bit of traction. Quality traction, to be sure, but not quantity traction. And, ultimately, we kept hearing that people wanted to see sales. They wanted to see numbers. They wanted to see quantity traction. Well, the only way you get more traction is with more sales, and the only way to get more sales is to work more on sales. Not, as it were, on having the same discussion about the prospect of traction with countless potential...but unlikely...investors.
What does being focused on investors and fundraising do to a team? It’s deflating. It’s distracting. It’s borderline depressing. You are constantly getting excited and then disappointed. You forget about the progress you were making. You neglect your CRM, and your project management tools, and you basically throw away hours of time and effort spent on organizing and creating those systems in the first place. Because, now outdated, you have to go back and try to sort through it all, only to want to just start over. Let's be honest...aint nobody got time for starting over and redoing things you already did when you’re a start-up with a runway of capital that's barely long enough for landing a toy plane.
It also affects your overall momentum. Momentum is key, because you need it to help push you past the thoughts of your foregone social life, the income you no longer have coming in to your bank account, and your main focus: the core of your business. Then, when you’ve lost that momentum, and the laser-focus that comes with it, and you wind up months down the road with no investors and certainly no additional traction (because you neglected sales, like idiots), you also start to “get creative.” Now, in some ways, that’s an amazing thing. You come up with new and innovative ideas. BUT, you’re also not laser-focused on the core of your business. Somewhere along the way, you lost the momentum that helped keep you on track. The track that you know has been laid to lead to success. So, while it finding yourself in a position to get creative can often be a really good thing, when it comes as a result of funding not coming in (when you shouldn’t have been trying to raise it in first place), the timing is just off.
So, what do I suggest? Well, I think going in to your business with a realistic understanding of how much capital you have to work with and how much runway you really may need to get traction to a point where investors will be coming to you, is a good place to start. And I mean realistic - like cut your expectations in 10 pieces, and take one bit, and that’s realistic. Then, listen to your friends who tell you it’s going to take 60-80 conversations with people before you find your angel/seed investors, and plan accordingly.
Above all, remember that you are the one who is going to make your business successful. Your hard work. Your resourcefulness. Your motivation. Your continued momentum. Your focus on what you have to do, and yourself kicking yourself in the butt to get it done. Sure, some money in the bank will always help you stay on track, but you might just find yourself better off for not having it when you think you need it most. Fingers-crossed! (We’re certainly counting on that! :))