StructuringFundraising Strategy
How Much Should You Raise? The Complete Guide to Startup Fundraising in 2025
Learn how to calculate your raise amount, choose between SAFEs and priced rounds, and navigate term sheets strategically.
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Investors don’t fund companies – they fund founders. Learn how the best founders flip the script with Fundraising 365.
Mark Bugas
Yes, building investor relationships months or years before you need capital through an approach called "Fundraising 365" dramatically improves outcomes by creating strategic long-term connections rather than transactional last-minute scrambles, positioning you to raise from strength when timing is optimal rather than desperation when cash runs low. Founders who start fundraising only when they urgently need money face three critical disadvantages: running the business takes a backseat to intensive fundraising consuming 30-50% of their time, investors hold all negotiating power recognizing founder desperation, and rounds take longer feeling chaotic as you simultaneously try building relationships and generating competitive momentum. The best fundraises close in weeks or days not purely from manufactured FOMO but because founders spent extended periods building relationships allowing investors to observe execution over time, creating pull from the market signaling when to formally raise rather than pushing into uncertain fundraising hoping for interest.
The counterintuitive insight is that spending modest time on investor relationships continuously (monthly updates, quarterly calls) requires far less total time and stress than intensive fundraising marathons consuming months when you actually need capital. Continuous relationship building through regular updates keeping investors engaged without meetings, recurring monthly blocks for investor/founder calls maintaining connections, and systematic tracking preventing relationships from going cold creates foundation where investors already understand your business, trust your execution, and wait for appropriate moment to invest. When you finally raise with these relationships established, the process becomes strategic conversations about partnership terms rather than transactional pitches trying to generate interest from scratch while simultaneously proving your worthiness and creating competitive dynamics.
The benefits of early investor engagement compound over time: investors follow your progress rather than just evaluating static metrics at one point, observe how you execute against plans demonstrating reliability, develop genuine excitement about your trajectory creating preemptive interest where they chase you, and provide strategic conversations about market dynamics and positioning rather than purely evaluating fundability. Some investors may proactively suggest you raise or offer terms before you even formally start fundraising, providing clear market signal that interest exists rather than going to market speculatively hoping you're fundable. This approach puts founders in control with leverage and options rather than reactive positions hoping someone will fund them.
The caveat is that Fundraising 365 works best for most founders building companies outside mega-accelerators like YC or Techstars, which create concentrated investor demand through demo days making scarcity-based approaches effective. For founders not receiving substantial investor inbound from accelerator affiliation, relationship building beats waiting for perfect timing. Even within Fundraising 365 framework, when you see clear signals that opportunity exists to raise, employ calendar density strategy stacking meetings tightly creating urgency converting long-term relationships into closed rounds quickly. The goal isn't perpetual fundraising distraction but strategic relationship investment enabling efficient decisive fundraising when timing is right.
Founders often start fundraising too late, scrambling to build relationships while trying to generate FOMO. This means:
We get it: you don’t want to spend any more time speaking with investors than you absolutely have to. But somewhat counterintuitively, this approach almost guarantees you’ll have to do just that.
The best fundraises close in weeks or days – not just because of FOMO, but because founders have spent months or years building relationships through an approach we call Fundraising 365. They only pull the trigger on a raise when they can feel pull from the market. This puts founders in the front seat:
The best salespeople don’t pressure prospects into buying. They recognize that timing will be right for only a fraction of the people they speak with. More often than not, they play the long game: get to know them, regularly catch up, learn about their wants and needs, understand their career aspirations, feed them valuable information, and become a trusted resource before becoming a partner. The same holds true for fundraising.
Engaging investors early means:
Some accelerators (like Techstars) tell founders to hold all investor meetings after demo day to create scarcity and competition, and to actively turn down meetings before then. This works well for programs such as YC and Techstars with large networks that drive demand. For most founders, relationship-building beats waiting, unless they’re receiving a lot of investor inbound
Pro tip: Even if you follow Fundraising 365, when you see a clear signal that there’s an opportunity to raise, use the calendar density strategy – stack meetings tightly to create urgency.
Some of the best investor intros come from well-regarded portfolio company founders.
How to build founder relationships the right way:
We get it – you’re busy. Here’s how to build relationships without losing focus:
The benefits of early investor engagement compound over time: investors follow your progress rather than just evaluating static metrics at one point, observe how you execute against plans demonstrating reliability, develop genuine excitement about your trajectory creating preemptive interest where they chase you, and provide strategic conversations about market dynamics and positioning rather than purely evaluating fundability. Some investors may proactively suggest you raise or offer terms before you even formally start fundraising, providing clear market signal that interest exists rather than going to market speculatively hoping you're fundable. This approach puts founders in control with leverage and options rather than reactive positions hoping someone will fund them.
The caveat is that Fundraising 365 works best for most founders building companies outside mega-accelerators like YC or Techstars, which create concentrated investor demand through demo days making scarcity-based approaches effective. For founders not receiving substantial investor inbound from accelerator affiliation, relationship building beats waiting for perfect timing. Even within Fundraising 365 framework, when you see clear signals that opportunity exists to raise, employ calendar density strategy stacking meetings tightly creating urgency converting long-term relationships into closed rounds quickly. The goal isn't perpetual fundraising distraction but strategic relationship investment enabling efficient decisive fundraising when timing is right.
Dedicate 2-4 hours monthly to investor relationships between active fundraises through sending quarterly written updates requiring 1-2 hours to compile, taking 1-2 investor or founder calls monthly on a recurring schedule, and attending occasional events or engaging with investor content online. This modest consistent investment maintains relationships without becoming operational distraction, contrasting dramatically with 30-50% time commitment during intensive fundraising. Set recurring calendar blocks like "last Friday of every month for investor/founder calls" creating routine rather than sporadic attention based on available time. The key is consistency over intensity; investors value founders who systematically maintain contact more than those who engage intensively then disappear for months. Most founders find that 3-5% of their time invested in continuous relationship building reduces total fundraising time by 30-50% when they actually raise, massive positive ROI on modest ongoing investment.
Start building investor relationships 12-18 months before you anticipate needing to raise, providing sufficient time for investors to observe multiple quarters of execution and develop genuine conviction about your trajectory. If you closed your seed round with 18 months runway, begin building Series A investor relationships immediately rather than waiting until 6 months of runway remains forcing desperate fundraising. For pre-seed or seed founders just starting, begin attending events and connecting with investors appropriate for your next stage immediately even if that round is 18+ months away. The relationship building timeline means investors observing you for 6-12 months before you raise develops far stronger conviction than meeting them for first time when you urgently need capital. However, don't let lack of early relationship building paralyze you; starting late is better than not starting at all, and you can still successfully raise through more intensive traditional approaches if necessary.
Include four key elements in between-round investor updates: key metrics and progress since last update showing traction trajectory, major wins or milestones like customer acquisitions or product launches, specific challenges or learnings demonstrating self-awareness and growth, and asks where investors can help through introductions or advice. Keep updates concise at 3-5 paragraphs or bullet points, sent quarterly unless you have exceptional monthly progress warranting more frequent communication. Avoid generic updates lacking substance; every update should contain concrete evidence of progress or learning. Frame challenges as opportunities demonstrating how you're addressing them rather than complaints seeking sympathy. End with specific asks making it easy for investors to help: "We're hiring a VP of Sales—happy to receive introductions to candidates" or "We're exploring partnerships with enterprise IT vendors—would value introductions to relevant contacts." Updates maintain your visibility and demonstrate systematic progress investors appreciate.
Yes, build relationships with investors who invest one or two stages ahead of your current position, as they become highly relevant for future rounds and often provide valuable strategic guidance in the meantime. If you're raising seed, develop relationships with Series A investors who will be targets for your next raise in 18-24 months. Many sophisticated investors actively develop relationships with promising companies before they reach investable stage, providing advice and connections that help you reach that stage. However, don't waste time with investors completely misaligned with your trajectory; focus on those who could credibly invest in your next 1-2 rounds. Some investors explicitly prefer investing in companies they've tracked for extended periods, making early relationship building essential for accessing them. The multi-stage relationship development approach ensures you're never starting from scratch when you need capital, always having warm engaged investors who understand your business.
Balance continuous relationship building with not appearing perpetually fundraising by framing conversations as seeking advice and sharing progress rather than soliciting investment, being explicit that you're not currently raising when that's true, providing updates focused on progress and learning rather than fundraising pitches, and only formally asking for investment when you've decided to raise. Investors appreciate founders who maintain contact and seek guidance between rounds; this doesn't signal desperation but rather sophistication about relationship building. When sending updates, note at the top "Not currently raising—just wanted to share progress with our supporters" if that's accurate. During calls, lead with "I'm not fundraising now, but valued our previous conversation and wanted to get your thoughts on [strategic topic]." Most investors distinguish clearly between founders building relationships versus those constantly asking for money; the former builds credibility while the latter damages it.
Continue building relationships with investors who funded competitors as long as they could invest in multiple companies in your category, which many funds do despite having one portfolio company already. Some investors pass specifically because of portfolio conflicts, but others actively seek multiple positions in promising categories for portfolio strategy or hedging reasons. Be transparent about the competitive situation rather than hiding it; sophisticated investors already know about competitors and appreciate candor. If investors definitely won't invest due to conflicts, maintain relationships anyway as they often provide valuable market insights, potential customer or partner introductions, and may refer you to other investors. Some of the most valuable advisor relationships come from investors who can't invest due to conflicts but believe in your potential and actively help through other means. Don't self-select out of relationships assuming conflict prevents all value; let investors make that determination.
First-time founders without existing networks can still implement Fundraising 365 by systematically building relationships from scratch through joining accelerators providing structured investor access and community, attending startup events and demo days where investors seek deal flow, engaging thoughtfully with investor content online building visibility before asking for meetings, connecting with founders of portfolio companies requesting advice and warm introductions, and leveraging second-degree connections through your team's collective networks. Start relationship building with accessible angels and micro-VCs who more readily meet unknown founders, using those relationships to get warm introductions to larger institutional investors. The timeline extends longer for network-building first-timers; plan 18-24 months of relationship development versus 12-18 months for connected founders. Accept that building from zero is harder but entirely feasible; many successful founders started with minimal networks and systematically built them through consistent effort. The key is starting immediately rather than waiting until you desperately need capital to begin networking.
Yes, send quarterly updates to investors who passed on previous rounds unless they explicitly indicated no future interest, as circumstances change and they may become interested as your traction improves. Many investors pass on early rounds due to stage, timing, or insufficient traction then invest in later rounds after observing your progress. Frame updates to passed investors as keeping them informed rather than asking them to reconsider immediately: "Wanted to share progress since we last spoke." Track which investors passed for what reasons; those citing "too early" or "call us at $X milestone" are prime candidates for re-engagement. However, don't send updates to investors who clearly indicated zero interest or whose feedback suggested fundamental misalignment with your approach. Quarterly updates to the maybe-later group costs minimal effort while potentially converting future investors who need to see extended execution track record before committing.
Fundraising 365 means continuous relationship building through modest time investment (2-4 hours monthly) maintaining investor awareness between formal fundraising periods, while "constantly in fundraising mode" means perpetually pitching and seeking investment consuming substantial operational time. The distinction is maintaining relationships versus active solicitation. Fundraising 365 founders send updates and take occasional calls but explicitly communicate they're not currently raising, focusing conversations on strategic advice and progress sharing. Constantly-fundraising founders consume excessive time in investor meetings, create perception of desperation or inability to close rounds, and distract from business building that creates actual fundability. Fundraising 365 is low-intensity relationship maintenance enabling high-intensity efficient fundraising when you formally raise, versus high-intensity constant fundraising that exhausts founders without achieving clean closes. The goal is being strategically visible without operational distraction.
Transition from relationship building to formal fundraising when you observe multiple signals including investors proactively asking about your fundraising plans or suggesting you should raise, achieving milestone traction that significantly improves your positioning, runway dropping to 12-15 months requiring you to begin fundraising process, and having 3-4 investors expressing clear interest in leading if you raised. The "pull from the market" Fundraising 365 creates manifests through investors initiating fundraising conversations rather than you constantly pushing. However, don't wait indefinitely for perfect pull signals; at some point runway forces you to raise even if pull isn't overwhelming. The optimal timing balances strong pull from relationship building with adequate runway avoiding desperate fundraising. If you've been building relationships for 12+ months and see genuine investor interest in your progress, you're likely ready to formally raise regardless of whether investors are explicitly suggesting it.
Fast-growth startups benefit even more from Fundraising 365 because rapid execution creates compelling narratives that investors following you closely get excited about, potentially accelerating raises beyond what intensive but late-starting processes achieve. Hypergrowth companies often have investors proactively offering terms before founders formally fundraise, enabled by relationship building that keeps investors informed of trajectory. However, hypergrowth may compress timelines; instead of 12-18 months of relationship building, you might have 6-9 months before needing capital. The principle remains: investing relationship time early pays dividends when you raise, even if "early" means months rather than years due to accelerated growth. The compressed timeline means being even more systematic about relationship building since you have less total time for investors to observe execution. Use aggressive traction to compensate for shorter relationship duration.
Track investor relationships through simple spreadsheet or lightweight CRM with columns for investor name/firm, last contact date, last update sent, relationship strength (hot/warm/cool), next planned touchpoint date, specific interests or concerns they've expressed, and introduction source. Set calendar reminders for quarterly update sends and monthly relationship calls. Review your tracking monthly identifying relationships going cold requiring re-engagement. The key is consistency rather than sophistication; even basic tracking dramatically improves relationship maintenance compared to ad-hoc memory-based approaches. Platforms like Flowlie provide purpose-built relationship tracking eliminating manual maintenance, but even simple spreadsheets work if you discipline yourself to maintain them. The worst outcome is having no system and letting valuable relationships atrophy through neglect rather than intentional deprioritization.
If you're genuinely too busy for 2-4 hours monthly on investor relationships, you're likely too busy generally and need to delegate or deprioritize other activities, as relationship building is strategic investment in future fundraising efficiency that pays enormous dividends. The "too busy" objection often reflects discomfort with investor conversations rather than actual time constraints; most founders spend 2-4 hours monthly on lower-ROI activities that could be reallocated. Start minimally with quarterly written updates requiring 1-2 hours quarterly (30 minutes monthly) and one investor call monthly (1 hour monthly), total 1.5-2 hours monthly. If you can't find this time, your next fundraise will consume 100-200 hours over 3-6 months through intensive process that relationship building would have dramatically streamlined. The question isn't whether you have time but whether you'd rather invest 2 hours monthly now or 150+ hours later, the latter while under pressure with limited runway.
Tailor your Fundraising 365 approach for different investor types: angels often prefer more personal relationship development through occasional coffees and casual updates, institutional investors typically want more structured quarterly updates and strategic conversations about market dynamics, and solo GPs fall somewhere between preferring regular contact but with less formality than large funds. Angels appreciate personal touches and frequent casual interaction; institutional investors value consistent professional updates demonstrating systematic progress. However, the core principle applies across types: continuous relationship building before you need capital dramatically improves fundraising efficiency regardless of investor category. Adjust formality and frequency to match investor preferences, but maintain systematic contact rather than disappearing between fundraises. Some angels appreciate monthly brief updates while some institutional investors prefer quarterly comprehensive reports; learn each investor's preference through direct questions about how they like portfolio companies to maintain contact.
Measure Fundraising 365 success through leading indicators including number of investors on your regular update list receiving quarterly communications, percentage of investors engaging with updates through replies or questions, investor-initiated conversations about your progress or fundraising timeline, and warm introduction paths to target investors developed through your network expansion. Track engagement rates: if 30% of investors respond to updates or proactively reach out, your relationship building is working; if 5% engage, you need to improve update quality or relationship depth. Success signals include investors asking unprompted "are you fundraising?" or "let me know when you raise, I'm interested," investors making introductions to potential customers or partners without being asked, and investors providing strategic advice going beyond perfunctory responses. The ultimate measure is how many interested investors you have ready to engage when you formally raise versus starting from zero relationships requiring intensive relationship building during compressed fundraising timeline.
The best founders don’t chase investors when it’s time to raise – investors are already paying attention. Fundraising 365 ensures that when you need capital, the right investors are ready to say yes.
Next time you close a round, don’t ghost investors. Keep the momentum going so your next raise is easier, faster, and on your terms. And always come prepared with tools like our Runway & Funding Calculator and Dilution Calculator.
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