Creating a Competitive Fundraising Process

Continuing with yesterday’s post Market Clearing Valuation for Entrepreneur’s Raising Money, the logical next question is “how do you create a competitive fundraising process?” That is, without a competitive fundraising process, there’s no way to know if the current leading investment option is truly the best one. Here are a few thoughts on creating a competitive fundraising process:

• Ensure a sufficiently large number of investors are contacted (e.g. 100+)
• Treat the process like a sales engagement and track everything in a CRM or Google Spreadsheet
• Develop as many investor relationships as possible well in advance of needing to raise money (the best time to raise money is when you don’t need it)
• Create all the necessary fundraising collateral like an executive summary, pitch deck, and financial model (if an operating business) before starting the process
• Build a timeline, and once it’s officially investor fundraising time, work to coordinate as many pitches as possible in a short timeframe so as to generate interest simultaneously

Raising money is hard, and it’s even more difficult to do it in a way that creates a competitive environment with multiple potential investors at the same time. Entrepreneurs would do well to create a competitive fundraising process to find the best investment partner.

What else? What are some more thoughts on creating a competitive fundraising process?