7 Tips on Raising Money From a Guy Who Is Raising

There is nothing "fun" about fundraising. I am going through it now...

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By Jason Saltzman

Opinions expressed by Entrepreneur contributors are their own.

There is nothing "fun" about fundraising. It's a huge pain in the cranium. I know: I am currently raising a round of financing for AlleyNYC. All I want to do is get back to work, write articles for you and hang out with my awesome girlfriend and friends. Raising money is a true dog-and-pony show, regardless of how great your business is. You have to explain the business model to those who want to stick a microscope up your butt. As painful as it is, I have learned some great things in the process:

1) Patience: You want the money and you want it yesterday. In order to make the right decision for your business, you must be methodical in your approach. This is one of the biggest things that will ever happen for you and your business. Stay calm, cool, and collected. Think Paul Newman in Cool Hand Luke. LEGIT.

2) Representation: The right representation is crucial. This is not just a lawyer, but a consigliere who is going to help guide you through the process. My lawyer's name is Evan Bienstock and he is a badass. He makes me feel confident going into a meeting. One of my biggest fears is seeming like an ass to someone who could be a huge asset to my business. A good lawyer will not just look at the risk. He/she will guide you to a palatable deal.

3) Selection: This is a HUGE one. I know you want to take a check from anyone, but remember: You are going to be tied to this person/group for the life of your business. It is a marriage and you need to think in terms of a long-term relationship. It is essential that you get along. If you take a check from the devil, do not be surprised when your hair catches fire.

Related: Whatever You Do, Do NOT Screw Up an Intro

4) Profile your investor(s): You should profile who you want to be your investor -- not so much who the person is, but what they look like on paper. Profile them. An entrepreneur who sold her company for millions of dollars, a real estate tycoon, a grocery store chain owner, etc. Target your demographic properly and your investor will not only write you a check, they will be the best advisors ever. To give you a real-life example, I wanted the most awesome media company on the planet that covers entrepreneurs as my investor. I wanted a publication that focuses on the inner workings of business, and the hustlers who are making it happen. I wanted my first investor to be Entrepreneur Media. Look at me now. They are an investor and now I get to write to all of YOU. Now, with Entrepreneur Media, we can show the world what we are doing at AlleyNYC. And that is AMAZING.

5) Pay Attention to the Warning Signs: If the person/group you are trying to raise money from is being a pain in the ass right off the bat, this is indicative of how it will be working with them in the future. Do you want that struggle? I am currently doing what I call the beer test. Would I have a beer with this person? Would I want to hang out with this person? Obviously, there is a ton more vetting that needs to occur than this, but if he/she or the group that you are dealing with does not pass this test, drop them like a bad habit.

Related: Difficult People Suck: 5 Ways on How to Deal

6) Wish list: Put together a list of the group/people you would love to raise money from. Top on my list are (in no particular order): Jay-Z (@S_C_), Russell Simmons (@UncleRUSH), Elon Musk (@elonmusk), Richard Branson (@richardbranson), Arianna Huffington (@ariannahuff), Kevin Spacey (@KevinSpacey), Oprah (@Oprah), Sheryl Sandberg (@sherylsandberg), Barry Gosin (real estate baller), Joe Pesci (because, as George Carlin used to say, Joe Pesci gets "stuff" done). Obviously, this exercise is a bit ridiculous. However, I think it's awesome that I can publicly announce my wish list. If any of these people would like to invest, you can reach me at jason@alleynyc.com. In all seriousness, having a wish list will help you profile what the perfect investor(s) will look like (see #4).

7) Mentorship: A good mentor is key, but especially when you are raising funds. The first investor of AlleyNYC is David Galanter, an amazing commercial real estate attorney, active tech investor, and friend. David is responsible for some of the largest real estate transactions in NYC. Through his mentorship and guidance I am able to navigate the rocky waters of deal making.

I know that you want the investment money. We ALL do. The money is a huge part of getting your business to the next level. However, I strongly suggest you look into who is giving it to you. A good partnership and meaningful relationships are some of the most important ingredients toward success. Hustle ON.

Related: Forget This Work-Life Balance Blah, Blah, Blah

Jason Saltzman

Startup Mentor, Entrepreneur, CEO of Alley

Jason Saltzman is a seasoned entrepreneur with a background in sales and marketing. Through his role as CEO of Alley and as a TechStars mentor, he advises hundreds of startups, offering real-life practical application and creative marketing advice.  

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