Venture Capital Funding

Taking money from the wrong investor is worse than taking no money at all. And most founders learn this too late. ➡️ ANGELS can save you or suffocate you. The right angel opens every door in their network. The wrong one texts you 47 times a week with "ideas." They invested $50K but want to run your company. Pick angels for their experience, not their checkbook. ➡️ VENTURE CAPITAL is rocket fuel. Pour it on the wrong business and you'll explode. They need 100x returns. Period. Your profitable, steady growth company? They'll push you to burn cash until you break. Take VC money only if you're genuinely building a unicorn. Otherwise, you're just their lottery ticket. ➡️ PRIVATE EQUITY doesn't care about your vision. They care about EBITDA multiples and exit timing. They'll load your business with debt, cut your favorite projects, and flip you to the highest bidder. Perfect if you want out. Soul-crushing if you want to build something lasting. ➡️ STRATEGIC INVESTORS play the long game. But it's their game, not yours. That Fortune 500 that "loves your product"? They might love it enough to copy it. Or restrict who else you can sell to. Or veto your next big move because it conflicts with their strategy. The painful truth? Wrong money compounds faster than no money. The founder who bootstrapped for two extra years? She still owns her company. The one who took predatory venture terms? He's an employee with equity. The one who sold to private equity too early? She watches strangers destroy what she built. The one who took strategic money from a competitor? He's locked in golden handcuffs. Good investors multiply your momentum. Bad ones create friction you'll fight forever. Know the difference before you sign. Your future self depends on it. P.S. Want a PDF of my Investors cheat sheet? Get it free: https://lnkd.in/d7KY4N6U ♻️ Repost to help a founder in your network. Follow @Eric Partaker for more investor insights. — 📢 Want to lead like a world-class CEO? Join my FREE TRAINING: "The 8 Qualities That Separate World-Class CEOs From Everyone Else" Thu Jul 3rd, 12 noon Eastern / 5pm UK time https://lnkd.in/dk6JFGip 📌 The CEO Accelerator starts July 23rd. 20+ Founders & CEOs have already enrolled. Learn more and apply: https://lnkd.in/dzmXp7kj

Founders: planning to fundraise every 18-24 months is planning to fail these days. The 18-24 months tagline has been standard VC wisdom in the US for many years. And our data from 2018 through 2021 shows that it was actually good advice! But things have radically shifted over the past 2 years. The median time between primary round fundraises so far in 2024 is 2.18 years (or ~26 months). Lines on the chart below show the median time between primary round fundraises by quarter. We included Seed to Series A (in black), Series A to Series B (in blue), and Series B to Series C (in orange). The green dots indicate the median for the year. From 2018 through 2021, the data lined up pretty neatly with the standard advice zone. In fact, time between rounds actually drifted down a little, starting at 1.72 years and ending 2021 around 1.62 years. Of course then we hit the major fundraising downturn, interest rates changed, the VC world flipped - and timelines extended rapidly. 𝗡𝗲𝘄 𝗔𝗱𝘃𝗶𝗰𝗲 • Expect the money you raise today will need to last you for 2.5 years at minimum.    • The biggest factor in company spending has traditionally been payroll - and we've seen founders cut back sharply on new hiring in response to this new reality. Be specific about your team size.    • Yes, there are bridge rounds happening and they are not shown in the chart below. But you don't want to rely on the possibility of bridges or extensions when building your fundraising plans.    • Certain sectors (like AI) are raising at a higher frequency, but even the hottest industries are well above the old medians for time between rounds. AI companies need to be default alive as well. Does this mean that many more startups should aim for profitability off the bat? Perhaps. Becoming a free-cash flow generating business is an amazing feat - but focusing too much on that early on can leave potential investors cold on your growth prospects. Tricky balancing act. The data is clear: getting new dollars in the door is taking longer than it has in 7 years. Adjust accordingly! #startups #fundraising #founders #venturecapital #runway Fresh startup data hand-delivered to your inbox—subscribe at the link in graphic below.

New VC fund managers do not know that these things they are doing are completely ILLEGAL… ❌ There are very strict rules around fundraising. Yet many new GPs copy what they see others doing — even when it’s illegal. The risk? Trouble today, or 5–10 years down the line when regulators or LPs look closer. Sophisticated LPs know the legal lines — and crossing them exposes both liability and inexperience. Here are the 3 most common fundraising violations (and how to avoid them): 1️⃣ PERFORMANCE-BASED FUNDRAISING COMPENSATION 👩🏾⚖️ Many “Vendors” often say: - “I’ll be a venture partner — give me carry for LPs I bring.” - “We’ll raise for you — just pay a % of capital committed.” 🚫 Illegal without a broker-dealer license ($50K–$150K+ + ongoing compliance). Even employee bonuses tied to fundraising can trigger violations. ✅ Legal way: Pay fixed fees or salaries unrelated to fundraising. Compensate with cash, equity or carry — but not tied to capital raised. 👉 Reality check: As a new manager, it’s extremely unlikely that anyone else can fundraise for you without a track record. You’ll almost always need to do the hard work yourself. 2️⃣ GENERAL SOLICITATION 👨🏻⚖️ New managers assume LPs will roll in if they “go public.” Tactics include: • LinkedIn posts about fundraising • Cold DMs to people • Podcasts/webinars about your fund • “Contact us to invest” buttons on websites 🚫 All illegal — unless you’ve structured under narrow exemptions. Even cold outreach counts as solicitation. ✅ Legal way: You can only pitch people you have pre-existing relationships with who are accredited investors. Network authentically, vuild relationships, then pitch one-on-one. 👉 Reality check: Public fundraising isn’t just illegal — it looks cheap. LPs won’t trust someone blasting cold posts with no track record. VC is trust-based. Public asks scream inexperience. 3️⃣ RAISING FROM EU LPS WITHOUT COMPLIANCE 🧑🏿⚖️ Many assume: • “If a European LP wants in, I can accept the money.” • “Everyone else does it — must be fine.” 🚫 Wrong. The EU regulates under AIFMD (Alternative Investment Fund Managers Directive) and MiFID II (Markets in Financial Instruments Directive). Even one EU LP can trigger filings. Regulators act quickly. ✅ Legal way: Work with EU securities counsel. File required notifications in each jurisdiction before accepting European LPs. 👉 Reality check: European LPs expect compliance. Skip it, and you lose credibility. Worse — a violation can come back years later and jeopardize your fund. Breaking the rules — even by accident — is the fastest way to undermine your credibility. And “everyone else does it” is not a defense. The managers who win are the ones who know the rules, build real relationships, and raise the right way. ⚖️ Know the rules. Follow them. Your fund' future depends on it.

You need more than just money from angel investors When we were building Mamaearth, raising funds wasn’t just about securing capital, it was about finding the right people to believe in our vision. And trust me, the right investor makes all the difference. It’s easy to focus on valuations and term sheets, but what truly matters is what they bring beyond the money: ☑️ Strategic guidance – They’ve seen businesses scale, pivot, and stumble. Their insights help you navigate challenges before you even see them coming. ☑️ Network access – The right introductions can open doors that money alone never will. ☑️ Mentorship, not just funding – A great investor challenges your thinking, refines your strategy, and supports your growth as a founder. ☑️ Emotional backing – The entrepreneurial journey isn’t for the faint-hearted. Having someone who believes in you, not just your numbers, is priceless. Funding matters, but who you take it from matters even more. If you’re building something, what’s the one thing you’d look for in an investor? #AngelInvestors #LeadershipLessons #Entrepreneurship #StartUps

There’s a missed opportunity in the investment world: over 95% of capital remains allocated to non-diverse funds. This leaves diverse-led funds undercapitalized, despite their proven ability to outperform. This disparity isn’t just about fairness — it’s about untapped potential. A report from the National Association of Investment Companies (NAIC) highlights systemic barriers: smaller commitments to diverse-managed funds, higher asset requirements and inconsistent support from corporate and union pension funds. These challenges restrict market growth and limit wealth creation in communities that could benefit most. Addressing these disparities is critical to building a more dynamic and equitable financial ecosystem. When diverse leaders manage funds, they bring unique perspectives, broader networks and innovative strategies that drive returns and create lasting economic impact. This mission is personal to me. Throughout my career, I’ve championed initiatives to expand opportunities for underrepresented entrepreneurs and fund managers. By supporting diverse leadership in finance, we not only unlock growth but also help close the #racialwealthgap and foster sustainable change. It’s time to reimagine how we allocate capital — embracing equality as both a value and a strategy. Together, we can fuel innovation, empower communities and strengthen our economy.

The first time I looked at a VC term sheet, I made the classic founder move: Scanned for valuation. Mentally celebrated. Big mistake. Because the stuff that actually matters? It’s hidden in the fine print. Here are 3 terms that quietly screw over founders: 1) Liquidation Preference – If it’s 2x participating, investors get paid twice before you see a dime. That “big exit”? Might feel more like a rounding error. 2) Board Control – You built the company, but if the board’s stacked with VCs… they can fire you. Even if you’re hitting your numbers. 3) Option Pool Shuffle – If VCs ask to increase the option pool before they invest, guess who gets diluted? You. Always ask: pre- or post-money? Too many founders learn this stuff the hard way. You don’t raise your Series A to get blindsided. >> Read the term sheet. >> Understand the incentives. >> Protect your equity. What’s the sneakiest term you’ve seen on a VC term sheet? Did you negotiate your first deal solo or bring in a lawyer? What’s one thing you wish you knew before signing? Teaser: we are working on an agent that will make sure that you don't sign your company away: upload and we will flag what you need to know. #startups #founders #venturecapital #fundraising

A Valley startup is raising a $2.5M pre-seed round at a $12M valuation. The product is almost ready, but there’s no traction yet, just the first pilot agreements being signed. They’ve been fundraising for 3-4 months now, but so far, they only have soft commitments for $500K. 🤷♂️ And this isn’t the first time in recent weeks that I’ve seen founders trying to raise a pre-seed round at a high valuation right off the bat and struggling with it. I just don’t get it. Why set a $12M valuation at this stage? Let’s break it down. Say they raise $2M now, everything goes well, and in a year, they hit $1M ARR. What valuation will they get with $1M ARR? Probably around $15M, maybe $20M at best - assuming they’re not in YC or don’t have big tech experience. And that’s in an ideal scenario. But here’s the problem: founders won’t want to raise at $15M because their last round was at $12M. They’ll aim for $20M or even $25M, struggle with it again, waste time, and risk not raising at all. By setting a $12M valuation now, they’re already putting themselves in a tough spot for the next round. A better approach? Raise a smaller pre-seed $500K to $1M at a lower valuation, say $6M. Give up 8%, use that capital to build traction, then raise a proper $2M seed round at a $15M valuation in six months to a year, giving up another 13%. Founders going for a $12M valuation early on usually worry about dilution, thinking they’re giving up too much equity too soon. But in reality, the difference is minimal! Let’s do the math: Gradual fundraising approach:  • Pre-seed: $500K / $6M → 8.3%  • Seed: $2M / $15M → 13%  • Total dilution: 21.6% Raising more upfront:  • $2.5M / $12M → 20.8% The difference? Less than 1%. But the gradual approach significantly increases the chances of actually closing both rounds while saving valuable time. And let’s not forget - fundraising is a full-time job for founders.

There’s a painful gap between a VC saying “this is interesting” during an initial meeting and actually wiring the money. Founders who close rounds in this climate know that a great story is just the beginning - the real test comes later during due diligence. From where I sit as an investor, I see it happen every week: a fantastic pitch earns a follow-up meeting, but the momentum dies during the diligence process. That’s because in a cautious market, investors aren't just betting on your vision / pitch / charisma / top-line metrics. They're betting on your execution engine. How you respond to their digging reveals more than any slide ever could. Here's a few operational habits I see from founders who navigate diligence successfully and close their round efficiently: ✔️ They Run a "Glass Box" Operation. Instead of scrambling to assemble a data room, they simply invite investors into their existing company 'brain' - usually a clean, continuously updated space in Notion, Coda or DocSend. It holds their live metrics, customer notes, and experiment results. This sends a clear signal: data isn't something you prepare for a pitch; it's the language you speak every day. ✔️ They Lead with Candor. The old way was to have a curated list of your happiest customers ready for reference calls. The new way is to get ahead of the request entirely. The most confident founders proactively share not just their wins, but their learnings from customers that didn't convert or churned. This confidence in your own process turns an interrogation into a partnership. ✔️ The Team's Cohesion Shines Under Pressure. Every question from an investor, no matter how small, is a test of your team's alignment. When you're asked for a specific data cut, a fast and collaborative response from your team is incredibly powerful. It demonstrates a level of operational harmony that no amount of pitching can fake. Nailing your pitch and articulating your vision are extremely important but your process is ultimately what gets investors to write the check. The fundraising game today is won in the trenches of the details. 🙌🏼 #startups #fundraising #everywhereVC

Andreessen Horowitz is not a venture capital fund. And it’s not just Andreessen. It’s all the big funds. They started out as VC. They operate funds that invest in private early stage companies. But they haven’t been VC funds for a very long time. That’s not a knock on their success or influence - both of which are massive. But these aren’t VCs anymore. They’re what I call Consensus Capital: big finance with a Sand Hill Road address. To continue calling them venture capital is both disingenuous and damaging to how we understand our industry. I vote we stop. Why do I care so much about this? For LPs: Because when LPs write checks into these funds, they should know what they’re actually buying. True venture capital is about messy, early, conviction-driven bets on non-consensus founders. Consensus Capital is about indexing into the obvious - paying up for access to a narrow band of “consensus” founders and making money off the beta. Those are two entirely different products. For founders: Because the label shapes their expectations. Consensus Capital flows to a very particular pedigree of founders - those from a handful of schools, startups, or AI labs who are highly discoverable (sometimes literally by AI agents). If that’s them, capital will be abundant and easy. If it’s not, they need to know there are still alpha-seeking VCs out there, the ones who look for outstanding non-consensus builders like Marc and Ben did 25 years ago. For the ecosystem: All the VC commentators (myself included) are tripping over ourselves about what this all means. My B-school classmate Rob Go wrote about VC’s existential crisis. Sapphire’s Elizabeth "Beezer" Clarkson says venture is broken. Carta data guru Peter Walker talks about the bifurcation of venture capital. Eric Newcomer describes it as a break between the “haves and the have nots”. Calling it all “venture capital” distorts the data. Mega-rounds and mega-funds skew every benchmark. Split them up, and the ecosystem gets better data, better benchmarks, and a truer picture of what’s really happening out there. Consensus Capital and Venture Capital are two different investing strategies (that can very much co-exist!). If we treat them like it, everyone would be better off. More in my substack in the comments.

Worth applying. Almost $2.1B in funding for climate and ESG technologies! Nine funding routes worth knowing if you're building in clean tech, sustainability or ESG right now. U.S. Department of Energy (DOE) Small Business Innovation Research and Small Business Technology Transfer programme - up to around $1.6 million across Phase I and II, recently reauthorised through 2031 after a five month lapse. https://lnkd.in/en3AziQe National Science Foundation (NSF) America's Seed Fund - up to $305,000 for Phase I, a strong low-friction entry point via their Project Pitch process. https://seedfund.nsf.gov Advanced Research Projects Agency-Energy (ARPA-E) - non-dilutive funding for high risk, high reward energy technology, often several million dollars per award. https://lnkd.in/eBdJRt_K Third Derivative - RMI and New Energy Nexus's global climate tech accelerator, connecting hard tech startups to investors and corporate partners rather than writing a fixed cheque. https://lnkd.in/eHr55UtC European Union Innovation Fund - one of the world's largest clean tech programmes, with individual grants ranging from tens of millions to over a billion euros. https://lnkd.in/ew3KXYGn EIC - European Innovation Council Accelerator - pairs a grant of up to 2.5 million euros with optional equity investment of up to 10 million euros for deep tech SMEs. https://lnkd.in/ej-qXnHK Breakthrough Energy Fellows - catalytic, non-dilutive funding from $50,000 to $500,000 for early stage climate innovators. https://lnkd.in/e__iKQ49 Elemental Impact - a non-profit climate investor backing companies from pre-seed to Series C, including a Data Center Innovation Initiative funded by Amazon, Google, Meta and Microsoft. https://lnkd.in/ekPnxNRK New South Wales Clean Technology Innovation Grant - up to 5 million Australian dollars for Australian businesses piloting lab-proven clean technologies, applications close 8 September 2026. https://lnkd.in/ejSr4WzD A few things worth knowing before applying: some of these are non-dilutive grants as well as equity investments, deadlines and open/closed status shift constantly, and a handful (like the EU Innovation Fund) operate on a completely different scale to early stage programmes, so it's worth matching the opportunity to your stage rather than chasing the biggest number on the page.