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I often hear The founders say they are raising money to increase their runway from 18 to 24 months. In a sense, that’s correct, but only from the startup’s point of view. However, that is not what an investor is looking for. Your business surviving another year and a half is not the goal of a fundraiser; that’s a side effect at best. It’s probably a decent guess for how long the next stage of the company will take, but only because 18-24 months is usually the time horizon you can semi-reliably predict.
But what happens at the end of those 18 months?
Instead, founders must communicate to investors what unlocks a funding round. That is expressed in milestones, not in time. The goal is to transform the company enough that it can do something it can’t do right now.
How much to raise?
How do you know how much money you need to raise? It’s a tough question, but it’s a critical aspect of your startup journey. Setting a clear and realistic fundraising goal requires careful consideration with one goal in mind: What hurdles do you have to overcome to be able to raise funds? next funding round.
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