Do More Faster: TechStars Lessons to Accelerate Your Startup

Chapter 59. If You Want Money, Ask for Advice

Nicole Glaros

Nicole is the general manager of TechStars in Boulder.

TechStars founders who are adept at actively engaging mentors and investors early in the program (and consequentially before fundraising) seem to have more success raising external capital later compared to founders who struggle to solicit and embrace mentorship. Why?

When you want advice, ask for money. When you want money, ask for advice. I believe there are three reasons this adage holds true.

Investors say no more than they say yes. An investor is constantly being bombarded by requests for capital. It's fundamental to his job. Statistics vary, but it wouldn't be unusual for an investor to say yes less than 1 percent of the time. Given that there are only two answers to the question "Will you invest?" they become adept at quickly discovering weaknesses and saying no. When approached, they are wearing their investor hat and their senses instinctively hone in on the negatives of the company. Most investors don't want to turn you away empty-handed, though, so they will offer advice for overcoming any weaknesses.

Risk mitigation. Getting investors and mentors involved early in your company before you start raising capital provides them a way to track your progress and learn about you before any risk is taken. Asking for guidance here doesn't have to be a yes or no question. ...