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Ten Uncommon Insights on Raising Capital

Uncommon Insights on Raising Capital

Raise and Rise, by Victoria Silchenko, Ph.D.

What it is:

A 500+ page book everything you always wanted to know about raising capital but didn’t know who to ask, by economist and startup consultant Victoria Silchenko

Why we chose it:

It’s very hard to get at the truth behind how finance really works. 

Reading this book is like taking a relaxed trip in the mountains with a very smart, human and funny economist who pulls back the curtains so you can see how the “magic” happens.

Why it matters:

If you’re not smart about where to get capital, and how to do it right, you can burn precious time and money chasing the wrong sources.

The big takeaways:

  • Financing finance has become the most rewarding avenue for capital seeking returns.
  • Risk capital is hard to find for founders even with a lot of capital because it’s hard to compete with the gains in financial investments.
  • Blockchain based platforms offer the potential to equalize the playing field, but are starting to tilt towards favoring the same old, big money where wealthy investors get the best deals
  • Venture capital invests in attractive exits, not in profitable companies. So, VC’s tend to favor companies betting on size and network effects, like Uber or AirBnB, and not profitability
  • Crowdfunding offers an attractive option for smaller entrepreneurs. But it comes with caveats: you need to decide if you want to do a “pure” capital raise or just get funding from fans and future customers. The difference is subtle but very important from a legal standpoint. 
  • Blockchain based crowdfunding models offer more for rewards-based crowdfunders than for the traditional fundraisers. But it comes with costs and isn’t a slam dunk

Bottom line:

Focus on building a killer business with customers, revenue and profits first. Then finding money becomes infinitely easier.

Click to get the book.