Running a well-designed fundraising process is a blend of art, operational efficiency, and human psychology. Unlike investors who evaluate hundreds of companies every year, most founders raise capital only once every few year—making it challenging to become experts at early stage fundraising. To help bridge that gap, we’ve compiled a set of proven tactics and resources from over a decade of investing at Designer Fund to set you up for success in your own fundraising endeavors.

Note: This guide assumes a basic level of knowledge around the startup ecosystem. If you're just starting out, we recommend checking out Carta's intro guide to fundraising to learn more of the basics.

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1. Research the current landscape

As you gear up for a fundraise, make sure to do your homework on the current funding environment, how you stack up against competitors, and who’s actively investing. This can take several weeks, but it’s time well-spent to lay the groundwork you need to be successful.

Assess the market

What spaces are investors funding now? What aren’t they funding? Are there any emerging trends or technologies gaining traction within your industry?

This will give you a sense of the “difficulty” of the raise you’re about to embark on. Understand how what you’re building stands out from both current offerings and potential competitors. For example, there is currently a lot of capital flowing into AI-native companies. If your company or approach does not leverage AI in some way, investors may see you as behind the curve. Additionally, be clear on the level of traction investors expect for your space and stage to ensure you’re raising at the right time, with enough progress to avoid being perceived as "too early.”

Evaluate your competitors

Which companies in your space and stage are getting funded right now? What can you learn from them to uniquely position yourself in this market?

We recommend looking at factors such as traction, revenue, go-to-market strategies, and the products of your closest competitors. A practical approach to gathering this information is to ask existing investors or angels about the companies they’ve recently invested in and the key insights they gained from those investments.

Know your target investors

Which funds specialize in what you’re building? Where are they in their fund cycle? What check sizes do they write? Do they invest at your stage and lead rounds, or do they follow on?

Many early-stage companies start fundraising only to realize they're fishing in the wrong pond and targeting the wrong funds—either talking to VCs who don’t invest at the pre-seed stage or those who only write small checks when there’s already a lead. Understanding what you need and which investors are the right fit at your stage is crucial.

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2. Hone your pitch

Next, it’s time to develop the story that will hook investors. Here are some starting points for building a compelling narrative that turns VCs into believers.

Identify your differentiators

When writing out your pitch, identify the most compelling strengths of your pitch and make sure they come across loud and clear. Is it your team that’s uniquely suited to solve this problem? Is it your product that does something technically difficult that you’ve been able to do? Is it traction that shows you have found something incredible?

Define your fundraising narrative

Once you figure out where you stand in the ecosystem, decide on the type of fundraise you’re putting together, and the type of story you want to tell. There are a handful of common approaches:

• Founder-centric story: If you’re early in your journey with big ambitions, emphasize your team’s achievements and career journey.
• Traction-centric story: If you have strong early traction, that’s it—that’s the story. Focus on your traction data—everything else just needs to be good enough.
• Product-centric story: If you’ve developed something truly novel but lack traction, focus your product's unique value—why what you’re building is exceptional, and how that will translate into traction.

💡 Pro tip: Investors will often diligence your product by speaking with their portfolio companies or industry contacts. It's important to be transparent about challenges, product limitations, or known issues early in conversations. If investors find out through their networks that you weren’t upfront, it can damage your credibility.

Share your vision

What do you really want to achieve? What does that future look like—a decade from now? This is something I often find I need to extract from founders, which is a shame because most investors are in this to help you change the world.

Looking back, Eugene Johnson, who raised a $14.5 million Series A in 2024 for Revi, credits being able to articulate this vision:

When we started fundraising, I didn’t realize how important it was to tell the long-term, 10-year vision. Really articulate the North Star of what you want to get to. I ultimately got investors on board because I painted that vision. Lots of folks told me to focus on our current traction and what we do today, but investors want to know they’re investing in something that will be huge. If I could do it over, I’d make sure I drove home that vision from the beginning. Eugene Johnson, Founder & CEO, Revi

Fundraising can be tough, and you need to go into the process with the mindset that it will take time. Rejection is inevitable, but as Cecilia Uhr, Co-founder & CPO of Bezi, wisely points out:

Rejection in any form stings, but just keep believing in your vision and be confident every time you go into a new meeting. You just need one person to believe in you and say yes. Cecilia Uhr, Co-founder & CPO, Bezi

Staying grounded in your long-term vision, even when the 'no's' come, is essential. Investors are looking for founders who can not only articulate where they are today but also paint a picture of a future they’re excited to invest in. It only takes one person to believe in that vision to turn a no into a yes.

Make the investor the hero

It's important to remember that a pitch is not just about past accomplishments, but about how the founder's vision will shape the future—with the investor's support. Framing the investor as the missing piece needed to overcome upcoming challenges can be highly effective.

A compelling narrative might sound like this: "We’re embarking on a journey to change the world, and we need your help to make it happen."

By positioning the investor as a key player, the founder can say, "We have everything in place except for what you bring to the table. With your support, we'll conquer the challenges ahead.”

Tommy Leep of Jetstream explains why the narrative is the most important part of your fundraising strategy:

The goal of a pitch is to turn VCs into believers. If you get only one thing right, nail the narrative.

Design your pitch deck or memo

If you’re looking to land VC funding for your company, one of the smartest investments you can make is to build a stellar pitch deck. A pitch deck is the hook that gets investors interested in your company’s potential. It helps articulate your vision and progress and, when done well, can play a huge part in helping you raise capital.

To help you get it right, we’ve put together a comprehensive guide on designing a winning deck or memo, packed with practical advice and pitch deck examples used in successful raises by companies like Framer and Netlify.

Remember that feedback is a gift

Once you believe you have your pitch in a good spot, it’s time to get feedback. Just like shipping a product and updating it based on customer feedback, you want to do the same with your pitch. Ask founders or friendly investors in your network to review your pitch and give you feedback. Then iterate on it again and again and again.

We usually find it takes at least a few revisions—and sometimes dozens of tweaks—to really nail the pitch and get it to a place where the communication is crisp and ready for a proper fundraise. Don’t get discouraged, and don’t ignore the signal you receive. If your feedback suggests your pitch isn’t landing, you either need to keep pushing on the deck or assess whether the company is in a fundable state.

You’ll know you’re on the right track when you start hearing feedback from angels and advisors like, “I’d put money into this” or “I’d totally want to work on this with you.”

Practice constantly and prepare for curveballs

A founder once shared with us that he wished he'd taken a more iterative approach to his raise. Initially, he tried brute-forcing the same pitch to dozens of investors, but after a few weeks, he realized he was repeating an unconvincing story. To avoid this mistake, rehearse your pitch repeatedly with other founders and friendly investors, and refine it based on their feedback.

Investors will sometimes interrupt and throw you off-script with questions about go-to-market or team in the middle your pitch. Practice adjusting your flow on the fly to avoid being thrown off course. Also, be prepared for commonly asked questions by documenting answers in an appendix and rehearsing your responses.

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3. Gear up for outreach

Once you’ve got your deck or memo in a good place, the next step is to create your target list of funds and partners.

Find the right firms

To identify the right firms to approach, start by talking to founder friends, angels, or other investors in your network. You can also use platforms like AngelList, Signal from NFX, or LinkedIn to broaden your search.

When selecting firms to engage, consider the following:

• Are they mission-aligned? For instance, if you're building a climate-focused company, look for funds with a climate thesis.
• Do they invest in companies at your stage?
• Do they lead rounds?
• Do they have any conflicting portfolio companies?
• What do other founders say about them?

Whenever possible, aim to get a warm introduction through a mutual connection. In our experience, introductions from founders or angel investors carry the most weight, especially for seed funds.

Find the right partners

Find the ideal partner at the right firm by researching who’s best suited to what you’re building. Once you’ve identified the person, lean on your existing relationships to get an introduction—high-quality introductions are worth their weight in gold. Look for connections within your network, including friends, customers, advisors, and communities you belong to to ask for warm intros to investors. Don’t hesitate to ask someone at the firm who the best fit might be, or consider reaching out directly to an associate to request the best person. Bonus points for having a strong point of view to make an impression.

📧 Example note to an associate at a venture firm:

Hey Anika,

I’m building a new type of AI design tool and wanted to send it over to MG given his experience in design tools. Do you think he’s the best person at GV for this or would you recommend someone else?

– Ben

Decide on the right number of funds to engage

Be strategic about how many firms you engage at once, and approach them in waves. For example, over a two-week period, we recommend reaching out to 7-10 funds, including 2-3 that you’re particularly excited about. Aim to get as many of them as possible to partner meetings.

If, after a few weeks, you don’t see strong interest from several firms, reassess your approach and diagnose what’s going on. Is it the deck? Your story? Your traction? When a fund passes, seek feedback to understand their reasoning and use that insight to see if you need to work more on the company or your communication.

View fundraising like team building

Startup fundraising and hiring are similar in many ways. Just as you take time to carefully vet potential hires, it's equally important to thoroughly understand your investors—what drives them, whether they share your mission, and how they’ve supported other companies in the past. This approach helps you build trust and ensures you're bringing on board investors who are truly aligned with your vision.

Josh Reeves, CEO and Co-founder of Gusto, recommends seeing this process like building a team:

View it like hiring. You’re building a team. You have a team of employees, a team of investors, a team of board members. That’s three distinct teams. To the extent you can, try to think about it as hiring and team building versus just money and price. Josh Reeves, CEO & Co-founder, Gusto

Consider building relationships before the round

There are varying schools of thought on this. While some folks think talking to firms could be a big distraction, others see tremendous value in building relationships with investors ahead of a funding round.

Cultivating relationships with investors before a formal fundraising round can be a strategic advantage. While some investors may not be ready to commit right away, staying in touch through regular updates or coffee chats can pay off in future rounds. This is especially important for founders who are early in their journey or aren’t looking to raise immediately.

Brett Goldstein, founder of a16z backed Micro believes in the importance of building investor relationships, especially for founders without established networks. He recommends the following strategic approach once you’ve identified key investors you want to engage:

1. Follow and engage with them on Twitter/X
2. Send them occasional DMs to stay on their radar
3. Add them to redacted investor updates
4. Arrange an in-person meeting

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4. Fundraising tactics

Once you’re ready to fundraise, there are some key tactics to keep in mind that will increase your chances of landing a meeting.

Keep your email outreach brief and genuine

In general, your emails should feel like they’re sent from a busy founder (or co-investor), not a marketing team. Keep them limited to a few sentences with key points and avoid too many graphics, verbose marketing-speak, or hyperbole. Once you’ve had your initial meeting, you can be more thorough in your responses.

Cold outreach can work—if done right

When reaching out to prospective investors, prioritize anyone you're connected to personally first, followed by warm introductions from founders or angels, then other investors. Cold outreach is typically less effective than these other approaches—unless done very well.

Case in point: we invested in Forma after getting a cold email from their co-founder Jason Fan—it was concise, targeted, and clearly highlighted their unique value. Jason followed up two weeks later—perfect timing to reignite interest without seeming over-eager. Following up strategically, ideally after a new customer win or other significant traction, can reignite interest without coming across as desperate.

Hunter Walk of Homebrew explains why a quality cold email is better than a very lukewarm warm introduction:

The always find a warm intro to a VC axiom is misunderstood. Its intent was to suggest that a mutual connection who can vouch for an entrepreneur’s abilities, experience, and perseverance would be of value to the process. It did not mean ‘find someone who happens to have the VC’s contact info and get them to forward an email without much context or relevance.’ Instead, I'd prefer a founder send me a great cold email. One which tells me why you’re reaching out, directs my attention to something, and suggests what you’d like as a next step. Hunter Walk, Partner & Co-founder, Homebrew

Leverage investor psychology

A lot of fundraising is a lot about emotion and understanding investor psychology. Are you someone investors want to work with? Can you convince them that top-tier talent will want to work with you? Make sure you’re mindful of the emotional and psychological elements in every investor interaction.

Investors are constantly evaluating how you run your fundraising process as a proxy for how you run your company. If your cap table is clean, your emails are well-written, and you demonstrate a sense of urgency, it sends a strong signal that you're meticulous in other areas of the business too.

Build momentum through strategic sequencing

Before approaching lead investors, we recommend securing early commitments from angels and non-lead funds. Having verbal or written commitments from non-lead investors builds momentum and creates urgency, which can motivate lead investors to act. Start with select non-lead investors who you have the strongest relationship with and who are most likely to say yes quickly to kickstart your raise. Getting early commitments gives founders optionality and a bit of leverage when negotiating with lead investors who typically set the terms

Clarify investor expectations early

Don’t wait until you’re deep into conversations to clarify expectations around terms, pro-rata rights, or future rounds. Make sure to ask lead investors what metrics or traction they need to see and proactively provide the necessary information.

When talking to leads, get a sense of what type of terms they want. Will they expect pro-rata rights? What kind of valuation or raise do they support? Who would they ideally want as the lead investor in the next round? What terms matter most to them in future rounds? Make sure that their expectations align with your goals and strategy.

💡 Pro tip: Optimize for peak performance. Schedule meetings when both you and the investor are likely to be at your best—typically earlier in the day. Meet in person instead of over Zoom. Small details like this can significantly impact how an investor perceives your energy and confidence.

Avoid party rounds

Avoid the temptation to raise a party round, where a startup raises capital from a large number of investors, each contributing a relatively small amount.

Steve Vassallo of Foundation Capital advises:

Having an investor base comprised of dozens of people who care a little is far less helpful than one or two investors who care a lot. Steve Vassallo, General Partner, Foundation Capital

That said, the level of energy or support an investor offers isn’t always proportional to check size. For example, an angel investor who contributes $25k might be deeply invested in your company's success, dedicating significant time and resources to help you grow. Conversely, a billion-dollar fund that invests $500k might provide little support beyond the initial funding, as their focus is spread across numerous larger investments.

Keep investors in the loop

When you’re fundraising, generate a war-room, all-hands-on-deck kind of energy for you and your existing investors. Set up a whiteboard to track the funds you're pursuing and their current status, and mirror this in a digital format like a spreadsheet. Share updates at least weekly on the status of investors and feedback you’re getting from them. Then, as you get closer to closing funding, consider increasing the frequency of your updates to twice a week or even daily, clearly communicating what you need from existing investors. If your investors feel your level of urgency in the process, they’ll be more likely to support you in a timely way.

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For fundraising success, play to your strengths

One thing we hope you take away from this guide is that there is no one-size-fits-all approach to fundraising. You don’t need warm leads, a specific background, or an elite education. While these factors can help—and are part of the game—it’s always more effective to work with what you have. Your strategy should be tailored to your team, your company, and the traction you’ve built. That’s what gives you a unique edge.

Fundraising isn’t just about raising capital; it’s about building strong, lasting partnerships that will help drive your company’s growth. By researching the landscape, honing your pitch, and targeting the right investors, you’ll be better equipped to navigate the complexities of fundraising with confidence.