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How to Raise Funding: A Guide for Early-Stage Startup Founders

Writer's picture: Beta FellowshipBeta Fellowship


Raising capital for your startup is one of the most pivotal—and often daunting—steps in the entrepreneurial journey. Whether you're in the early stages or have a product ready to scale, securing the right funding can help you accelerate growth, refine your offering, and bring your vision to life. But how do you go about raising funding, especially when you're at the early stage and the road is often unclear?


Here’s a roadmap to help you navigate the world of fundraising with confidence:


1. Understand the Different Stages of Funding


Fundraising terminology can be confusing, especially when you're just starting. Generally, the capital-raising journey unfolds across these stages:

  • Pre-seed: This is the very beginning, when you're refining your idea and may have little more than a concept. Pre-seed capital typically comes from friends, family, or angel investors. At this stage, the focus is on building a prototype or validating your business idea.

  • Seed: At this stage, you’ve got a solid product or service and initial market feedback. You're looking for funding to build your team, enhance your product, and grow your user base. Investors at this stage are taking on a lot of risk but are excited about the potential upside.

  • Series A: Once you have product-market fit and a solid user base, Series A is about scaling your business. Investors at this stage expect you to have clear metrics, growth strategies, and a solid path to profitability.


Tip: Each round has different expectations, and you need to know where you stand and what investors are looking for at each stage.


2. Craft Your Story and Value Proposition


Investors aren’t just looking at your product—they’re looking at you. Your story is one of the most important elements of your pitch. Why did you start your company? What problem are you solving, and why does it matter? What makes your approach unique, and why are you the right team to tackle it?


Tip: Be clear, concise, and passionate about the problem you're solving. Show how your product or service fits into the broader market and why it’s poised to succeed. A compelling value proposition will resonate with investors and set you apart from other startups.


3. Know Your Numbers


Financials are the backbone of your fundraising process. Even in the early stages, investors want to understand your financial model—how you plan to make money, your projections, and how you'll use their investment.


At pre-seed or seed stage, you might not have full financial statements, but you should be able to show:

  • How much you need to raise and why.

  • Your revenue model (e.g., subscription, one-time sales, etc.).

  • Customer acquisition cost (CAC) and lifetime value (LTV) projections.

  • Burn rate—how quickly you're spending capital.


Tip: Investors may look beyond the numbers, but a solid understanding of your finances and how you plan to use funds will establish credibility and demonstrate that you have a clear roadmap.


4. Build Relationships with Investors Early On


Fundraising is all about relationships. Start networking with potential investors well before you need the funding. Attend industry events, join startup accelerators, and leverage your personal network. Many investors prefer to build relationships with founders over time, so the more you connect, the more likely you’ll be top of mind when it’s time to raise capital.


Tip: Make sure to approach the right investors who align with your industry, vision, and stage. A warm introduction is always better than a cold outreach.


5. Pitching Your Startup


The pitch is your moment to shine. It’s your chance to communicate your vision, explain your business, and show how you'll use the investor’s money to generate returns. A great pitch deck is essential—it should be visual, clear, and tell a compelling story.

Your pitch deck should include:

  • A summary of the problem you’re solving.

  • Your solution and product overview.

  • Market opportunity and size.

  • Business model and revenue generation.

  • Traction (or milestones achieved).

  • The team (and why you’re the right people to execute the plan).

  • Financial projections and how the funding will be used.


Tip: Keep it concise. Investors see many pitches, and they need to quickly grasp the potential of your company. Aim for 10-15 slides that tell a complete and coherent story.


6. Prepare for Due Diligence


If an investor expresses interest, they will likely initiate due diligence. This is the process where they dig deeper into your business—reviewing your legal structure, intellectual property, financials, and even your team dynamics.


Tip: Be organized and transparent. Have all your documents ready—your financials, business formation details, contracts, and customer agreements. Be prepared to answer detailed questions about your business and the market.


7. Don’t Forget About Terms


Once you’ve found an investor, you’ll move into negotiating terms. The terms of your funding deal will dictate ownership, control, and expectations. Be prepared to discuss:

  • Valuation: How much your startup is worth.

  • Equity: How much of the company the investor will own in exchange for the investment.

  • Board seats: Will the investor want a seat on your board? What influence will they have?

  • Milestones and conditions: Are there any performance-based milestones or contingencies attached to the funding?


Tip: Work with a lawyer to understand the implications of the terms and ensure you’re not giving up more control than you’re comfortable with.


8. Keep Building and Stay Resilient


The fundraising process can be long and challenging. You may face rejections or encounter unexpected setbacks, but perseverance is key. Keep refining your product, growing your customer base, and moving the business forward, regardless of the fundraising outcome.


Tip: Fundraising is a tool to help you grow—not an end goal. Stay focused on your vision and continue to build your company with or without the funding.



Raising funding as an early-stage founder can feel overwhelming, but with the right approach, it becomes a strategic part of your startup journey. Remember, fundraising isn’t about a single “yes” or “no”—it’s about finding the right partners who believe in your vision and can help you get to the next stage of growth.


Are you ready to start your fundraising journey? Let’s connect and see how we can help you take the next step.


 

This blog is brought to you by Beta University. We help early-stage startups navigate the fundraising process and accelerate their growth. 


Beta Silicon Valley is an intensive 8-week pre-acceleration experience for founders who can be physically present in the Bay Area. Designed for first-time founders to build VC-fundable businesses with proven know-how from the heart of Silicon Valley (Completely Free).


​​​​​Some of our recent Alumni companies include Generation Lab (Sequoia), Adsgency AI (HF0), Tutti AI (South Park Commons & Skydeck); Openmart (Y Combinator), Mathgpt pro (Y Combinator), Dreammore AI (A16Z), Final Round AI (HF0), and more.


Reach out to us to learn more about how we can support your startup in the fundraising journey through our flagship accelerator program.


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