Many of the questions we get involve raising capital. Before quitting your job to work on your crypto project full-time, check out this guide to learn about the different options available to you to raise the money required to pay for your team of developers and marketing professionals (and maybe for your groceries).
Table of Contents
Definitions
Formally known as paying-for-it-yourself, this is the most straightforward method for those that can afford it. Additionally, bootstrapping can be a positive signal to investors, as it shows that you have “skin in the game,” and are not funding your idea solely with other peoples’ money. Foregoing outside investments can also give the core team a level of autonomy in a project. This naturally comes with unique financial considerations, so we’ve highlighted some resources here to help you:
A second option is to get investors to buy into your idea early. These can take the form of specific individuals (Angel Investors) or investment firms (Venture Capital). Notably, investment firms can be further split between generalists and specialists, the latter of which focuses on industry “verticals” (or, a specific sector/niche).
What you do for funding will largely be determined by how mature your project is. Thus, a common timeline for financing a project with investors is:
Seed round → Series A → Series B → Series C
In the early stages, it is more likely that you (or family/friends) will have to foot a larger part of the bill, although some projects can entice outside investors at this stage as well. A Series A round occurs around the same time that a project has a minimum viable product (MVP), and the later series serve to scale a project after the first revenue streams are set up. However, the contents of each round are not rigid and some may have investment opportunities before showcasing a working product. (see also: Venture Capital Financing in Crypto, Explained)
Importantly, Angel investors & VCs can ****provide more than just capital: they provide legitimacy to a project. Further, VCs can provide strategic partnerships, networking opportunities, and guidance (after all, they want you to succeed once they are invested).
Yet, before you receive support from investors, you have to actually convince them to give you their money. Next, we talk through how to best present your crypto project.
As a founder, your success depends on how good of an impression you can make with your project. This often comes down to your pitch deck and the story you tell. Unsurprisingly, there are better and worse ways to go about making one. Above all, the goal of a pitch deck is to create a presentation that is clear, concise, compelling, and easy to act on. These can take a variety of forms, so find one that fits your style and run with it. Here are some basic rules from the Touchpoint communications guidelines so that you are ready to go head to head with investors: