The 6 best episodes on building investor credibility before a pitch

00:02Welcome to Next Round Ready, the show for pre seed and seed founders who are serious about raising and the investors who want to find them. Early founders learn what makes them fundable. Investors hear from the founders worth watching. Your next round starts right now. Hello founders and investors. Welcome back to NEXT Round Ready. I'm yours Chris and today we're going to get into what makes a founder fundable. Now I have a pack list that I want to kind of breakdown to you guys and show you exactly what it is that makes a founder fundable. Somebody that I know when I meet them OK, this person is going to raise capital like I know that they're going to be OK out here. The first thing is a structure. The founders who are going to raise have some type of structure about them specifically, meaning that they already have sometimes raised capital. Sometimes these founders have really put in the work to establish themselves within their market, their industry. And this doesn't look like having a massive audience or anything, but you can just tell they've done the work. For example, when I look at their deck, I can see that it's just a professionally designed deck and it's not something they made with AI.

01:22That's like a deck giveaway that you're an amateur founder. If I get to you and I see that, OK, you don't really have a deck that stands out, that's different. It's just not quality. And if that's the case, I know you're not somebody that I'm probably going to work with. The just the truth. And even with phone calls like I had, I had a call with a founder last week and it was crazy because this guy was kind of laid back and really chill. And when I asked him about his product, he was just very nonchalant. And I get the whole nonchalant you're trying to be cool thing, but if you're trying to raise capital, you need to be very shalant. You can't ask for money and be too cool to ask for money. That doesn't make sense. It makes no sense. And talking to this founder, I realized they didn't have the passion. Like if I don't hear passion about your product, maybe in the business side of things, you may be a little confused or you may not know all the investment definitions and stuff. That's something I can understand. But what I don't respect, what I don't like is for you to come to me asking for money and you're just, well, this is my product. We kind of do this thing.

02:37We kind of do that thing. That's not the kind of founder you want to be. It's not you want to present yourself. And my advice to founders on this one is if you're struggling with that kind of passion and stuff, you're exhausted. Stand up during your meetings like this just shows that you're ready for investment. That's one of the small ways. If you as a founder don't have that excitement and you're not bringing that kind of structure to your pitch or in your deck or anything, I immediately know you're not serious. And I know founders hate when investors say this, but you got to think about it. I look at startups non-stop since I've been hosting this show for the year and a half, two years now, since I've been talking to founders, going to events and stuff for two years, all I do is talk to founders and investors. That's it. That's all I do. So I looked at more decks than most founders ever will. I look at more pitch decks in my e-mail, a doc, send the AI versions, Adobe, all of that. I get them in every way.

03:38And so with that being the case, I immediately can tell certain things because of a pattern. It's just the truth and I'm never wrong about this. I keep a list of all the founders I talked to without working with him or not, and tracking those I can always see like, yeah, this is a founder that is probably not going to go anywhere. And I look back six months later and they haven't moved anywhere. A lot of them have dropped idea completely and moved on to something else, which is fine. But that's why you got to come correct in the first call, in the first session, during the first meeting. First impressions are everything. Now, the second thing that really shows me a founder is serious is they know what they're using their funds for. Nothing sounds crazier than when you ask an investor for money and you don't know how you're going to use the money. That doesn't make any sense. And founders get a lot of attitude when you ask about that. But for me, it just seems kind of crazy, right? If you were borrowing like 50 bucks from a family friend or something, that really doesn't need a whole game plan. But if you go to somebody and ask them, go to institution, you ask them for 50,000, a $100,000, Don't you expect them to ask for a game plan or something?

04:54Don't you think they'll want some kind of verification or something? And if you think they won't, then you're just crazy. You were crazy. And I'm not saying that you need to have it detailed down to the dollar, which you could and you probably should at some point. But you wanna have a overall breakdown of the milestones that this money will help you reach, not specific ways you can spend the money, like, oh, we're gonna hire somebody or we're going to build this thing. Like we know that how are you going to use this money specifically? That specificity is what's important, like in terms of the milestones you wanna reach. That's how you tie it in. So don't just say, oh, we're gonna hire somebody, OK, We're going to put this money into building our team and adding this team members is going to get us to this specific milestone, right? This milestone is X amount of reach, X amount of customers, our pipeline, this and that, blah, blah, blah. Like that's how you want to build it out when you build it out that way. That sounds better. And by the way, I go through a lot more of this inside of the finding fundable course.

05:56It is completely free. So I just want to access it. I'll put a link to it down in the description box on this episode. Now the third pattern that I see from quality founders is their track record. Some investors will say that this is, you know, tied to the college you went to or where you worked before. And if for some, I get it, I think the lazy investors like to take that route. That's not really me. I more so like to focus on you as an individual and what you've done, not just what school you went to because you could have went to this cool university, whatever, just cause your parents afford could afford it or because you got a scholarship, whatever. But that doesn't mean that, OK, you go in there made you a transformative founder that you know what you're doing, you know what you're talking about, that you have any value to offer that just those don't mean the same thing. You know what I'm saying? And a lot of times back in the day, I think of venture capital 20 years ago, that was a easier way to get funding. Whereas now most, I know a lot of ECS who aren't even focused on founders from specific schools or institutions anymore because it's overrated. A lot of founders have been able to raise capital and start companies because of schools they went to. But then they don't return anything. The startup fails and it dies off. You know, they just live off of that name. So your track record has to be maybe where you worked before. If you worked at a great company for two or three years and now you're building your own thing, that's great. And even then, what did you do there? What was that like?

07:20What was that experience like? You know what I'm saying? Those things matter versus oh, I went to the school and I didn't, I worked at Google. Yeah, but in what capacity? In what way? That track record, it means something. And then the people you work with, right? What does your background look like? And this one, you got to take away a grain of salt because for me at least, I understand things happen, life happens. All I expect of you is for you to be able to explain to me what happened. So if you did have a bad relationship and you know, things fail with a business partner or whatever, OK, if it was terrible or whatever and it does come up, you got to be able to explain your part in it, be accountable. All of that stuff that kind of goes into the 4th one of my list, which is be coachable for the first time I meet you, you got to be coachable. You got to, if you're not coachable in that first meeting, that first exchange, I'm probably it's just won't go anywhere. And I try to explain to founders all the time that being coachable doesn't mean you don't have an opinion, you don't have a perspective. It doesn't mean that being coachable means that you may talk to someone, you may even disagree with them, but you know how to take what they say with a grain of salt and then you move on from it.

08:36That's it, That's it. It's OK. I am right. But instead of trying to argue and debate this, I would just let it ride. Sometimes that's just what you gotta do. That's part of being coachable. And then if, you know, we get on the call on the first on a Monday and I tell you do this, this and that, you know, and I can do the next step on my side and you don't do anything, well then, yeah, you're not coachable. You are not coachable. And I'm sorry, I'm not going to put my effort in and put you in a spotlight, all of those different things. If you aren't ready to put that work in and you are going to listen. I've had situations where I put founders in contact with people and it goes nowhere because the founder just isn't ready for that level of conversation. They're not coachable. They ruin it. Show up to meetings, like all kind of stuff, and it's just not what you, it's not what you want. And the last thing I will say on this is you got to be ready for investment. Ready for investment means that you know what this process looks like.

09:42I tell founders all the time to do the work of understanding venture capital language. There's a language that VCs speak. You need to speak that language. You need to know the details of it. I post a lot about it on Instagram and stuff and it's all the content. I'm posting non-stop about that. Yeah, make sure you follow me on IG. You need to know this language so that the investors take you more seriously and so you can get the best deal for yourself. You will get finessed by investors and some of these people working in venture capital if you don't know the language, if you don't know what pro rata rights are, if you don't know just the basics, man. And I know I'm saying it, but matter of fact, I'll do another episode on like the top 20 terms that a founder needs to know when raising capital because there are some that you just have to know. You just got to know them. And if you don't know them, it's going to be very hard for you to raise capital and not impossible, but just more challenging because you don't know the language. You know, you need to know when I say when we're having, when we're talking about a safe versus a seed round, you got to know the difference between those. And look, I'm not here to attack anybody. I'm just saying founders, you got to learn this. This is where you earn, you know what I'm saying? You have to put in a work and learn this. And if you don't want to, don't expect to raise 100,000 a $1,000,000.

11:07It's not going to happen. So those are just some of the things that I see in founders that have raised capital. Now, I wanted to do this episode to kind of explain to you guys, One of the big changes coming to next Round ready is I'll be bringing founders back. Yes, I'm bringing founders back, putting them on the pod. Founders have been on next round ready, you know, raised over $1,000,000, over $8 million actually. And I'm excited to put more of that back into the show. We got some big changes coming and that'll be a part of it. So if you're a founder that wants to be a part of this, make sure you connect with me on LinkedIn. That's step one. And then we can go from there because it'll be an application process, nothing crazy, but I want to focus on those quality founders again, man, I can't have you on my show on this platform, which is growing consistently and you're just not ready, you know, because we have a larger investor database now. I'm sending those investors information, I'm connecting with them, they're sending them deals and stuff, and I only want to send quality. So if you're not a quality founder, you just won't fit here. So if you want to be a part of that, make sure you check it out. Make sure you can echo me on Instagram or LinkedIn even X I'm on air too.

12:10I'm on Twitter and we can chop it U. So I will see you guys next time.