When is the Best Time to Raise Capital?
Chris Hawkins, Founder & CEO of SignNow (signnow.com),discusses the best timing to raise capital. Raising capital too early can complicate matters for your business.
- When you have completed a functioning prototype
- After establishing a compelling & personal vision
- Once you have recruited at least one technical team member
We just raised capital on the fall and I think there’s a couple of key things that you can start with. You really have to create a functional prototype these days. It’s competitive enough out there that for anything - consumer, internet or web-focused, there’s really no excuse not to.
The second thing you should do is really focus a lot of time on your vision. Make it really, really compelling, make it personal, make sure that investors understand why they should care. If you don’t really, really, really care, you’re not going to be able to convince them that they’ll care.
And the final thing you should really do is make sure that you’ve recruited at least one person. Going as a solo person, you’ll almost never be successful unless you already know the answer to this question. But really, you need to recruit one person. They need to be technical for most consumer-web and mobile companies that is an engineer, software engineer. They can go and they can code, they can build your product and hopefully scale to lead eventually a team of developers.
So really, in summary, the most important thing though I think is the vision. If you just get that right, you’re going to be able to do everything else that you’ll need to be successful.