236. Don't Fundraise, But If You Do Be Ready for Due Diligence feat. Tom McGrath, CEO @ iink

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Why would Tom self-fund or limit fundraising if he could? It can distract from the business

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Transcript

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If I had the opportunity, I wouldn't fundraise.

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I think that at least from venture capital, I think that most founders who do it the first time and then they have a big exit.

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They're like, yeah, I don't want to do that again.

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Some of them will raise venture capital, but many of them that I have spoken with would likely not again, or they would try to self-fund.

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Or at least limit the amount of venture capital that they have to take on because it is a distraction from the business.

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And you constantly have to be doing it.

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In my perfect world, if I had 100Million dollars sitting in my bank account, I would fund my own business.

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But you know, that's unfortunately not my reality.

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I would say that I would have invested a lot more time up front just making sure that we had good reporting, good analytics, good accounting, a really clean data room.

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One of the major components of what drives these timelines to be longer is not having all the information in one place and not having a good sense of what these people would want in a due diligence checklist.

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And every stage is different.

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The level of diligence that a Seed is different than the level of diligence at a Series A.

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I'm going to know ahead of time that at the series B, they're going to want to see that everybody has key man insurance policies.

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They're going to want to see that everybody has intellectual property assignments signed.

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They want to see non competes.

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They want to see all of these different things that I didn't know that they were needed at the Series B, but I think that I would invest more time in trying to preempt or understand what they're going to ask for instead of like scrambling around, trying to handle 15 different diligence requests from 15 different firms.

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As we go to raise the Series B I'm establishing those relationships now.

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And that's another important thing that I would say about funding is don't wait until you have to do it.

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You should be having the conversations and building those relationships now.

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Thank you Tom.

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For some awesome advice this week.

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Before we wrap up, let's delve into what sets AVL Growth Partners apart.

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AVL's team brings significant years of finance and accounting expertise.

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Why go fractional?

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Picture this: a CFO with an average of 19 years of senior finance CFO experience, alongside controllers and accountants with 15 years under their belts.

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This isn't just bookkeeping.

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It's the expertise your company needs to navigate economic challenges.

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If you want to take your company to the next level and need the experience required to make it happen.

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Visit AVL growth.com right now.

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Time is our most precious asset, thank you for spending some of it with us this week.

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And I hope everybody has a wonderful weekend.

236. Don't Fundraise, But If You Do Be Ready for Due Diligence feat. Tom McGrath, CEO @ iink

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