Chapter 6: Raising Capital
One of the biggest roadblocks for new founders is figuring out how to find investors—especially if they don’t already have a network in venture capital or angel investing. The good news is that you don’t need to be well-connected to successfully raise funding. You just need to be proactive, resourceful, and strategic in how you reach potential investors. Obviously if you have connections to venture capital investors or wealthy family friends that is going to be the best place to start. However for this course, we’re going to break down how first-time founders can identify, connect with, and pitch to investors—even if they’re starting from scratch.
Before you start reaching out, you need to understand what kind of investors are the best fit for your startup. If you remember back to our outline of different stage investing, you’ll remember I constantly spoke about how investors are often specialized. Investors come in different types, and each one has different expectations and check sizes. Here are the main ones you should be looking at as a first-time founder:
Angel Investors – High-net-worth individuals who invest their own money, often writing checks between $10K–$250K. They typically invest early and can be more accessible than VCs.
Micro-VCs & Pre-Seed Funds – These are small venture capital firms focused on early-stage startups, writing checks between $100K–$1M. They often back first-time founders.
Accelerators & Incubators – Programs like Y Combinator, Techstars, or 500 Global provide funding, mentorship, and investor connections in exchange for a small amount of equity.
Crowdfunding & Syndicates – Platforms like AngelList, Republic, and WeFunder allow startups to raise from multiple small investors.
Once you know who you're targeting, the next step is finding and reaching out to them. Investors aren’t one-size-fits-all. You don’t want to pitch to just any investor—you want to find investors who are actually interested in your industry, stage, and business model. A good practice is to make a list of investors you want to reach out to.
Here’s how you can build your target list:
Use Investor Databases – Websites like Crunchbase, AngelList, PitchBook, and Signal by NFX allow you to search for investors by industry, check size, and location.
Look at Similar Startups – Find companies similar to yours and see who invested in them. You can find this info on Crunchbase, LinkedIn, or PitchBook.
Follow VC Blogs, Podcasts, & Twitter – Many investors share their investment interests on Twitter, LinkedIn, or their personal blogs. Follow them to get a sense of their focus areas.
Use Warm Introductions Where Possible – If you don’t have direct connections, try getting introductions through founder communities, mutual LinkedIn contacts, or accelerators.