Good founders view their fundraising process as a sales process but great founders also understand the difference between the two. For most companies you need 1,000's, maybe even 1,000,000's of customers to be successful. To be successful fundraising you don't. You need a handful of investors that say yes.

To get 1,000,000 customers inherently means 99% of them will be cold and you need to find the repeatable, scalable sales model so you can work the funnel. It's a rinse and repeat process through and through. The fundraising process however is different and comes in two stages. Stage 1 is finding a lead investor and that can often be more of a numbers game. Stage 2 is filling the round and if you find the right lead investor, that changes our odds of success dramatically.

There's a lot of confusion among first-time founders about the importance of finding a "lead" investor and truthfully I didn't buy into this for a long time. A "lead" is not just a title investors seek to make themselves feel important (most of the time). The reason founders' initial focus on a lead is so important is because most successful funding rounds generally come down to one really well connected investor making lots of warm intros for you.

Here's the way for entrepreneurs to view it: You may need to exchange emails with 300 prospects to book 30 coffee meetings in order to get 1 term sheet from a lead investor. That's Stage 1. Stage 2 is that lead investor, if they're genuinely well connected, will then turn around and make 15 warm intros to other investors for you, 5 of which will result in a yes to fill your round. Yes fundraising is hard; because that's actually a best case scenario where you check all of the other boxes! If you don't find a lead you can often get stuck playing the Stage 1 numbers game for every investor you close.

So what's the moral of the story here? The value of each investor you talk to is not simply what size check they can write, what guidance they can give you, or what credentials they bring to your advisory board. The value of an investor is also their network and their ability to leverage that network to help you quickly close your round. Stop viewing each person solely in terms of their individual value and start viewing them in terms of their network value as well. The right lead investor's network can be worth much more than their individual contribution.

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