Never trust outside resources to raise funds for you
From time to time, in my role As a consultant, I am approached by companies that have a plan in place for their fundraising that does not involve the CEO or a member of the founding team who is in charge of the fundraising process. From one perspective, I can understand that: VC fundraising, from the outside, is a lot like sales, and if you have a good salesperson, why not let them do what they do best?
The problem is that while salespeople are great at sales, the VC fundraising process is much different than landing a client. You’re trying to find an alignment between the business and a long-term partner who will have a significant amount of insight into the future of your startup. And if there are discrepancies between the sales process and the deeper due diligence at the company (and there will be, because the sales team has a different long-term perspective on what success looks like), that can make the whole thing fall apart. .
There are several good reasons why, in the early stages of fundraising, the founding team should be in charge of the fundraising process. In this article, I break it down and explain why it’s a terrible idea to let anyone but the CEO do fundraising.