Highlight the Investors Who Are Already in the Deal

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In a fundraising round, many investors do not want to go first.

In fact, most investors want to be the last one to join the round as the risk of not closing is very low.

In raising funding, highlight the investors who are already in the deal.

Some investors have a reputation for successful funding.

Other investors look to the current investors in the deal as a proxy for joining.

Ask your current investors if you can use their names in the fundraising process.

Invite current investors to give a testimonial about why they invested in the company.

This could be recorded and shared with others.

In the recording have the investor talk about what they like about the startup as well as the risks they see.

This gives potential investors insight into the diligence the current investors found.

Emphasize the diligence work done by the current investors in the deal and show the prospective investors any diligence done so far.

Most startup investors are follow-on investors and will look to others for confirmation.

When you reach the halfway point of the raise, the signup rate often accelerates.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

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