I have a question. Since I'm nowhere near the valley and the start-up community in my community might as well be non-existent, I was wondering how I might go about meeting and getting introductions to investors. Not being well connected with a very poor local community makes it hard for me to know where to start.
Since I'm nowhere near the valley and the start-up community in my community might as well be non-existent, I was wondering how I might go about meeting and getting introductions to investors.
In that case, it's probably good to think of ways to move to the valley.
It sounds like the only investors in your area are probably individuals who happen to be wealthy, i.e. potential angel investors. But outside of the valley, angels tend to be family or people you're already acquainted with. And even if you can get them to invest in you, they're going to be less experienced than valley angels, meaning they may be dangerous to you. E.g. they'll probably rely heavily on their lawyer to structure the deal, and since you're not in the valley, that lawyer probably isn't a startup specialist, so you'll need to be extra careful they're structuring the deal properly (and structuring your company properly, if they're incorporating you).
Investment can be had in places other than the valley, of course. But the reason you want to be in the valley is because (a) that's where the top investors are, and (b) there are a lot of them. Raising investment anywhere else therefore increases the risk of having bad terms forced on you by clueless angels or predatory VCs.
Choosing to seek investment in the valley is like choosing the high ground in a battle: it's naturally suited to protect you from dying. And since avoiding death is every startup's most important goal, the valley is therefore the most important place to be.
> But outside of the valley, angels tend to be family or people you're already acquainted with.
Find out who the LPs are of any private equity fund, there are your angels (by the 10's if not the 100's), and none of them will be family or people you are already acquainted with. Additional upside for those locations where this matters: and all of them will already be vetted as qualified investors.
If you're a programmer, the best route to investors is probably through other programmers you know. If you know any who are founders or early employees at a startup, they can introduce you to their investors. They can also introduce you to other founders, who can introduce you to their investors.
Get 1,000 users in a month and you don't need any introductions. You can cold email them and they will jump you. Maybe not jump you, but that should give you an idea.
Don't waste any idea on fundraising until you have product fit, market fit and first initial traction. Trying to fund raise before that is the sign of an amateur and if you actually get an investor interested before product fit, you will get a very shitty deal and the whole process will kill you.
