For an outlier, there is no precedent, of anything, including fundraising.
That is kinda like asking what the best guide for dating is. Many, proclaiming to be a domain expert, will list their prescriptions. Few will succeed as a result of it. Reality is quite a bit more different than the (false) presumption of a fixed protocol around the process.
The essentials of fundraising differ greatly depending on the type of innovation you have in the hamper (as an entrepreneur). I say that because much of innovation’s arbitrage (VC) has turned subprime, and uniform investor intake criteria perpetuate false positives as prime and discard false negatives. Such subprime innovation intake attracts a lot of equally subprime entrepreneurs hoping to make it big.
To put that in terms of the aforementioned dating process, when you are just out there to get laid, the process of doing so differs quite a bit from marrying the person of your dreams. Many wannabe entrepreneurs are proverbially getting laid by subprime venture capitalists, with mindless innovations designed to monetize advertising clicks as the societally disenfranchised children born from it.
To drive the latter point home further, small-business is not venture capital. Each carries an entirely different risk-profile and upside trajectory. Subprime venture capital (as the tacit support from limited partners indicates) systematically deploys a private-equity risk profile (after the chasm risk), chockfull of collusion, which will never produce consistent venture style returns. Crowdfunding has turned subpriming into a soup of public socialism, with the populism of groupthink by principle unable to spot an outlier. Banks have no idea what they are doing in the innovation space, except to play around in the margin of error of their total assets under management.
The point is that most of today’s publicly available options for raising capital are, at best, a lousy lay. One that is the result of a dance between an entrepreneur taught not to think too big (or about the morning after), and the investor equally constrained. I will not be in the audience watching that dance.
But for those entrepreneurs who refuse to marry mediocrity, and sincerely want to change the world with their dreams, I suggest you get off the beaten path. All outlier entrepreneurs need to do is to act like one. And steer clear from the schools of uniformity. To locate and sell to a prime investor how you best support the realization and monetization of that dedicated dream. Right now, right here.
Like dating for anything else but a lay, fundraising is not about terms or procedures. It is all about the ability to sell unprecedented foresight of upside to whet the right investor’s appetite. And only that dance will toss out any formal guide or process that merely indicates the kind of innovator asking the question.
