How To Raise Money
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How To Raise Money

Paul Graham
Paul Graham, 2013
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Recommendation

Two fears plague investors: They’ll invest in a start-up that flounders, or they’ll miss out on one that thrives. These conflicting fears often lead to confusing investor behavior that inexperienced start-up founders may misinterpret. The result is a recipe for start-up failure. Co-founder of the successful seed accelerator Y Combinator Paul Graham gives start-ups a set of applicable “if-then” rules to assist the fundraising process. getAbstract recommends this practical guide to entrepreneurs, CEOs and anyone navigating fund raising for a start-up.

Summary

Start-ups should have distinct “phase one” and “phase two” fund raising stages. In phase one, you should “accept offers greedily,” while in phase two, you should be more selective. Fund raising isn’t what makes a start-up successful; the real challenge is building a product and then “listening to users complain” about that product so you can improve it. Preparing materials to convince investors is a distraction from the important work. Get it over with as quickly as possible. If investors contact you when you’re not in a fund raising phase, only let them invest if they offer terms that...

About the Author

Paul Graham is a programmer, writer and investor. He co-founded Y Combinator, one of the most successful seed accelerators in the world.

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