What To Do When Your Startup Fails To Raise Money
It’s every founder’s worst nightmare. You pour years into a business idea, then months into building the perfect pitch deck and a long series of stressful investor meetings. Then at the end of it you’re left with a smattering of well-wishes, a few vague invites to send follow-up emails, and a whole big bucket of wasted time.
You’re back at square one. No funding, no traction, no resources.
This is not uncommon.
I don’t know you or your company, but I’ve played the startup game for over 20 years, both bootstrapped and VC-funded, and I can assure you of one inarguable fact:
Your business idea just isn’t investable.
Now what are you going to do about it?
The worst thing you can do is keep charging ahead with your fundraising plan. That’s the definition of insanity — doing the same thing over and over again and expecting a different result.
Here’s what to do instead, based on my own experience hitting this same wall, and also helping dozens of founders, both first-timers and repeat founders, break through it.
You have four options.
Option 1: Give Up
I remember the first time I had to shut down a startup because we failed to raise money. It was actually an attempt to save an already-doomed startup that had raised over $15 million in VC funding back in the early 2000s.
It was an online video product, which didn’t really exist in the mainstream at the time. According to three of us on the tech side, the only problem with the business was the target market. The tech worked, the user base was engaged, money was coming in, it was just coming in from the wrong crowd.
The three of us made one last pitch to the existing investors to use some of the intellectual property and $2 million more in new funding to pivot the model from B2B to B2C. Online video by the people, for the people.
The investors rejected our pitch. And since the three of us were young and technical and could easily find another job, we gave up.