The Fundraise Framework Top Startups Use

12 min readNov 3, 2021

No one is born knowing how to fundraise. This framework helps the world’s best pre-seed and seed stage companies successfully fundraise.

As a mentor at Techstars and an Entrepreneur in Residence at the Entrepreneurs Roundtable Accelerator, I’ve had the privilege of mentoring hundreds of the best startups in the world. Even these top startups going through the most elite accelerators need help fundraising. Below is the framework I’ve developed and shared with the startups I mentor to help them run a fast, successful fundraise.

No one is born knowing how to fundraise. I can’t tell you how many times I’ve heard the following from founders:

“The fundraise is taking forever.”
“I had great conversations with this fund, and then they totally ghosted me.”
“We’re half way to our fundraising goal, but need more intro’s to investors.”
“The fundraise feels like a waste of time. I just want to get back to work building my startup.”

Fundraising is not easy for anyone. I hate those twitter threads about the mythical ex-FAANG employee building his (yes, usually a man) startup, who gets approached at a Palo Alto coffee shop by some VCs in suits with a term sheet ready to go. Fake news. Raising a round doesn’t just happen. It’s a skill that takes time to learn through trial and error.

I learned it from the many entrepreneurs and investors who mentored me when I was raising money for my startup KitSplit. (Thank you Murat Aktihanoglu and Jon Axelrod at the Entrepreneurs Roundtable Accelerator, joanne wilson at Gotham Gal Ventures, Isaac Oates Founder/CEO of Justworks, Matt Salzberg Founder of Blue Apron, Jamie Wilkinson Founder/CEO of VHX, and James George CEO/Cofounder of Scatter, among many others.) I also learned it by making a lot of mistakes in the fundraise and wasting my time. Now, as a mentor I’ve developed this framework to help my mentees fast track their learning. They’ve helped me hone this framework through dozens of conversations and coaching sessions.

After sharing this framework, I hear the following from founders:

“If it weren’t for our discussion on how to frame the fundraise, I may still have been languishing in the land of fundraising. We wrapped up a month ago and had our pick of who we let participate in the end. Can’t believe it! You gave me strength.”
“This information is incredibly helpful. Just wanted to reach back out to say I have been consulting this [framework] regularly!”
“Wow did I get a lot out of that [framework]! Thank you so much Lisbeth!”
“Thank you so much Lisbeth! So helpful. Working on building out a targeted investor outreach list, and reaching out to people in our network for intros.”
“This is amazing!!! Thank you so much!!!”

This framework includes the strategy that investors might not want you to know. It includes signals investors are looking for, even if they aren’t aware of it. If you’re a pre-seed or seed stage startup raising a round, read on! I hope it’s helpful to position you well, shorten your fundraise process, and get funding you deserve.

Fundraising Framework Overview

The basic concept of the fundraise framework is that you and investors are not aligned on timing for the fundraise. Investors want to de-risk the investment and are incentivized to drag out conversations with you as long as possible. The longer they wait the less risky the investment. Whereas you, the founder, wants the fundraise to go as quickly as possible, so you can get back to work building your business.

This framework is about moving the fundraise forward by creating urgency for the investor. It’s about inspiring FOMO (fear of missing out) so the investors are incentivize to move quickly.

There are 3 parts of the framework:

Preparing for the fundraise
Scheduling the process
Herding investors through your process

Part 1: Preparing for the fundraise

Before you officially start your fundraise you’ll need to build a long lead list of target investors and get the right introductions to them. You’ll also need to create excellent assets to share with investors.

1a) Lead list of investors

Fundraising is a numbers game. It’s also a sales process. You’ll need to build a long and targeted lead list of investors to pitch. Expect to receive 50 “No’s” for each “Yes.” If you’re an under-represented founder and the biases in VC are against you, expect even more “No’s” to get a “Yes.” So you’ll want a list of 100+ target investors.

Only talk to investors who can lead the round or write a check without a lead. Use tools like Crunchbase and AngelList to find if the target investors have a recent history of leading rounds at your stage and in your industry. If they haven’t led a seed round in the last year, chances are they won’t lead yours. You can work backwards to find the right investors by looking at comparable companies in your space (that are not competitive) and see who lead their first round. Also ask the intro’s (see below) for info on whether the investors lead or not.

1b) Getting intros to investors

Once you have a solid investor lead list, you’ll need the right intros to those investors. My take is that there is a hierarchy of intros when reaching out to investors. The intro you get is important because it sends the first signal to investors about whether or not they should be excited about your company. The person who makes the intro is lending their credibility to you. They are essentially pitching on your behalf and priming the investor for a good (or bad) convo with you. The better the person who gives the intro, the better your convo with investor will be. Here’s how I’d rank the type of intros to get:

The best intros are from founders who are in the investor’s portfolio and who have had successful exits or high growth and have made money for the investor.
Next best are successful founders not in the investor’s portfolio, but who are close to the investor or founders in the investor’s portfolio who haven’t yet had an exit.
After that are credible people close to the investor.
If you have a lead investor for the round or current investor, intros from them are next on the list of most effective. The bigger the fund, the stronger the intro.
The worst — and I advise startups not to take these intros — are investors who have said no to you. Often investors want to be “nice” and want you to like them (they might not like what you’re building now, but they want to keep the options open for your next company). They might say no to your round and then offer to intro you to another investor. This will set you up for a bad convo and waste your time with the intro. When the rejecting investor intros you to a second investor, the second investor will immediately ask the rejecting investor if they are investing in you and why/why not. The investor sending the intro will tell them they are not investing. That sets you up at a disadvantage before you’ve even talked to the investor.

1c) Building your assets for the fundraise

You’ll need compelling assets to share critical information about your startup with investors. These include:

Investor Blurb: When you ask for intros to investors, you’ll meed to share an investor blurb with the person making the introduction. Investors will use the blurb to determine if you fit in their thesis and if they should meet with you or not. I generally recommend that a blurb includes the following in 3–5 sentences:

What the company does & business model
Problem it solves
Size of that problem — aka Market Opportunity (in $ Billions)
Traction ($, LOIs, IP)
Notable team-members, relevant experience, awards, notable advisors, notable investors and anything impressive that will show the investor this is de-risked and high growth opportunity

Here’s an example blurb from my company KitSplit:

KitSplit is the rental marketplace for cameras and related gear. Just as YouTube, NetFlix, and Snapchat transformed the distribution side of visual content, KitSplit is transforming the $80B production side of visual content by democratizing access to cameras and production gear. Called “the AirBNB for creative equipment” by Forbes and Fast Company, KitSplit connects people and companies who own gear with those looking to rent. The KitSplit streamlined rental process saves users time and money by offering all gear options in one place, plus services like insurance and delivery. KitSplit launched last year, and is already the biggest marketplace of our kind with tens of thousands of customers from YouTube creators to companies like NBC, Vox, Hearst, and National Geographic.
Recently in the news:
Forbes’ coverage of KitSplit’s acquisition of competitor
KitSplit President in Forbes 30 Under 30

Pitch Deck — It’s generally a good idea to create two pitch decks: one to present and one that’s more detailed with an appendix to send as a follow-up if the investor asks. Spend time looking through the seed stage pitch decks of relevant notable successful startups to get ideas. Pro-Tip — do not share your deck until after you have met with the investor. You want to control the conversation and make a strong impression on the investor. If you send the deck without talking to the investor, the investor might apply their own biases and narrative to your deck. You lose control of the story.

Cover Page from AirBNB’s early fundraise pitchdeck

Due Diligence/Deal room — Have this prepared before you start the fundraise so that when you get a term sheet or a commitment you don’t waste time and can go straight into due diligence. The deal room should include your P&L, projections and any detailed stuff that investors need. Only share the due diligence docs once you have a commitment from an investor. Your pitch, conversations, and pitch deck should have all the info an investor needs to decide on whether or not to invest. Investors should not be using the due diligence material to make the decision to come into the round. Rather DD material are a gut check for the investor. They’ll be looking for red flags. It should back up what you’ve already told them in more detail.

While prepping for the fundraise I highly recommend this blog series, from Mark Suster, “Both Sides of the Table”:

Part 2: Scheduling the process

For meetings and running your fundraise process I suggest setting up a specific timeline so you don’t waste your time. This will keep the process running really tight and will prevent the fundraise from dragging out. Expect to have about 3 conversations with each investor to get them to a “Yes” or “No.”

Start your first convo with an investor by asking them questions about their thesis and process. This will help you in 2 ways. 1) You’ll be able to qualify the investor to get a sense of whether they are a good fit for your company and round. 2) You’ll learn more about them, which will help you tailor your pitch to their interests. Questions to ask include:

Tell me about your thesis (use this to assess whether they invest in companies like you, your stage, industry, business model etc)
What stage do you normally invest in?
Do you lead and what size checks do you write?
What kind of milestones do you look for?
How do you work with founders you invest in? (This is to understand their value-add as investors beyond the check.)
What is your decision-making process — how long does it normally take? (This will help you get a sense of whether this investor can write a check independently or whether they need buy in from other partners. You can then build your follow-up strategy accordingly. For example, if they need buy in from others you could suggest setting up a call with the other partners as next steps.)

You can set up your schedule as something like this:

Week 1–2:

First meetings with Angel/VC partner (only with partners, not with associates or principles). Stack meetings back to back to fill your calendar. This creates urgency for the investors to get a slot on your calendar.
Goal of these meetings is to get a “No,” a “Yes,” or a next meeting (realistically it’ll take 3 meetings or more to get to “Yes,” but you’ll want to accelerate that as much as possible and get all the “No’s” out of the way as quickly as possible.) A “No” at this stage is a good thing because you can move on from that investor and not waste time on someone who will never write a check.

Week 2–4:

Second meetings with interested investors
The minute you schedule your first 2nd meeting with a partner/angel, individually email the other investors you met with who haven’t said no, to let them know that you are moving forward into 2nd round conversations with Partners. That will show them the round is moving quickly and that they should feel urgency to set up a second convo with you.
Goal of these meetings it get to a “No,” a “Yes” or a next meeting.
At the end of the meeting you can literally ask them — “does this sound like something you’d invest in?” If they say no, ask why — it’s always important to get feedback. If they say “yes we’d like to invest” — ask “how much?” and if you get a dollar amount you’ve got a commitment to the round! If they say yes but we need more info on XYZ, say “great, I’ll send that info over and we can talk about it on our next call.”

Month 2–3:

Follow-up meetings, answering questions.
Goal is to get to “No” or “Yes”. The “Yes’s” should have specific $ amount that they want to invest in the round.
If you’re doing a SAFE/Note, anytime you get a commitment immediately send the investor the paperwork and the bank info to get that $ wired ASAP! Do not let them wait to change their mind, make them make good on their commitment.
Don’t go into due diligence without getting a commitment and an offer. Sometimes investors will waste your time and ask for lots of info before committing. You can politely let them know you’d be happy to provide info and open the books once you know how much they’d like to put into the round. The truth is — you’re talking to 100+ investors, you don’t have time to go into due diligence with all of them. Your pitch should provide them with enough info for them to make a decision.

Part 3: Herding investors through your process

Some investors will be slow to respond or drag their feet giving you an answer.

Here are some tactics to create urgency for them and get them moving more quickly:

When you get a new commitment, use it as an excuse to follow up with investors who are dragging their feet. Let them know you’ve received another commitment and the round is filling up, and that they should schedule a convo with you before it’s too late.
If you go into due diligence, let the other investors who were most interested/most far along know, to spur them into action to make an offer.
If you have an exciting business update, signed a deal, made a hire etc, send that update to investors.
Always send personalized individual emails to investors. Never mass email a bunch of investors. You want to balance between being the hot shit creating FOMO, and also flattering investors that you really want them specifically — like you have the pick of the litter, and you choose them. Mass emails send a signal that you are lazy and/or desperate.
Employ the “surround sound” approach. Get someone trusted in the investors network to give the investor a nudge back channel, telling them that they heard the round was moving fast and they should act.

I hope this is helpful for anyone raising a round! Did I miss anything? Any other tips and tactics that have worked for you? Message me and comment below!