💰 How to Raise Millions

👋 Hi there - it’s Egemen, thanks for reading Scalable.

In the (not so distant) past, raising money for a startup was reserved for only a handful of people. You would have had no idea how to raise money almost unless you were born into it.

Well, this is no longer true. If anything, quite the opposite is true these days.

This edition will help you understand the ins and outs of fundraising, how the process works, and whether or not it’s the right thing to do for your unique situation.

Here’s a snapshot of what’s on the menu today:

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☝️ Scaled this past week: Revolut

It’s been brewing for a while—Revolut is preparing for an IPO.

The neo-banking app has recently attained a $45bn valuation before going public. It’s the scale of the week!

This share sale allows current employees to capitalize on their contribution to the company’s growth and will attract new and existing investors. This follows an increase in Revolut’s revenue to $2.2 billion in 2023.

According to the Financial Times, Revolut is currently planning its IPO in New York. K’s new Labour government is trying to persuade them to list in London instead. What a great problem to have :)

🧠 Deep-dive: Should you even raise?

I was watching the MasterClass of Mark Cuban recently. It was a good wake-up call to reality (that we all should be reminded of from time to time) when he said:

When you raise money as a founder, you’re giving up a slice of your company. That slice could be worth a lot down the road if you go public or get acquired.

You don’t “have to” fundraise.

So if you can get away with securing money through bootstrapping, crowdfunding, government programs, banks, or etc., it’s completely fine to not raise and keep 100% of your company.

Once you bring investors on board, they’re now part of your team. They’ll have their own ideas about how things should run, which might not always line up with yours. Make sure you are prepared for that.

If you wanna sell your company for hundreds of millions of dollars down the line, then fundraising is probably the right fit for you.

The fundraising strategy will vary based on location, business type, and model. Here are the 3 common fundraising stages, but hitting these numbers below doesn’t guarantee success:

👉 Pre-seed is the first funding round, often from friends, family, or angel investors. Founders usually quit their jobs to focus on their startup. Investors expect a minimum viable product (MVP) and some proof that the problem being solved is worth paying for. These rounds are small, typically $100k to $1M, aimed at building the product and gaining traction.

👉 Seed stage follows the MVP launch and early user feedback. It’s about proving market demand and gaining traction. Seed rounds range from $500k to $3M, with a focus on moving closer to product-market fit.

👉 Series A is raised after finding product-market fit, showing strong market potential, and building a solid team. These rounds are larger, usually $5M to $10M, often led by a key investor. This is also when a board of directors is typically formed.

Depending on the business, the rest of it can go to anywhere from Series B-F, or IPO. The 3 above are relevant for all fundraising processes.

🗺️ Method: Investor CRM Template

Here’s a controversial take:

Well, I wholeheartedly agree with this statement.  It’s probably impossible to remember all the prospective investors you speak to, let alone details of when you last spoke, what you talked about, etc.

That is why you need an investor CRM tracker that keeps all your contacts in one place. Here’s a template I created with some inspiration from Hustle Fund VC’s format:

I hope it comes in handy - it’s yours!

💡Spotlight: Taplio

I have recently discovered Taplio, and I’m quite intrigued by what they do.

They have an AI engine to create, schedule, and analyze LinkedIn content, making it easier to generate engaging posts and carousels.

Taplio also offers features for relationship building, lead generation, and advanced analytics to monitor performance.

It’s a pretty neat tool that I’ve added to my stack to be used in full capacity soon.

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⚾️ Catch: Raise Millions by Hustle Fund VC

This is the most recent book I’ve read - and I’ve done it in one sitting.

If you’re reading this newsletter, you should read this book by Hustle Fund VC. They are not a sponsor or anything - this book is simply a gold mine if you are into the whole startup journey.

This guide will teach you everything you need to know to fundraise from the pre-seed stage to your Series A. Seriously, it covers everything you need.

By the way, it’s free.

👋 Working on a startup? Here’s how I can help:

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