Guidance for first-time fundraisers, developed while raising $20 million.

BY JOSHUA JONES

[Photo: Getty Images]

I’ve started and sold a handful of companies over my career, and along the way I’ve raised over $20 million from a mixture of angel investors, strategic investors, and venture capital. I’ve also invested the proceeds from my own exits in a series of startups and scaling businesses. While it can be challenging, stressful, and rewarding all in one, I have come to love the journey of raising capital. I’ve also seen best practices emerge. Here are seven of them.

1. The optimal time to ask for investment is long after the first meeting.

This is true for both trusted angels and VC fund founders. Angels are often looking to engage personally; VCs may run a more structured process and get to the bottom line faster. But early relationship-building helps with both. Begin to build relationships the moment you think you may raise in the future. Invite prospective angels to react to product updates quarterly, as people invest in people they know. When the time comes for a raise, if you’ve kept them informed, they’ll let you know they’re interested before you even have to ask.

2. Understand the investor’s thesis.

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