When are you actually ready to fundraise?
(FYI, there’s an optional resource for founders at the very end of this email, in case it’s useful for you.)
Hello friends,
Welcome to the first edition of Node. I’m grateful to you all being here.
To start us off, I am answering a question that came in from a founder in response to my initial email to some of you:
“As a new founder, I keep thinking about funding timing. How do you know when you’re actually ready to raise (not just excited to raise), especially at pre-seed or early stage? And what level of traction or proof is usually ‘enough’ to start investor conversations — particularly in our region?”
It’s a good question. One that I haven’t directly considered from the perspective of a founder.
So it felt like the right place to start in our first official issue of Node.
Two sides to the same question
Researching it helped me understand the two sides of addressing this, and the gap that exists between most investors and founders when they talk about fundraising.
Most founders experience fundraising like this:
I need money to build
I need money to test
I need money to reduce risk
I need money to move forward
For you as a founder, fundraising feels like a leap of faith. You consider that you’re asking someone to believe in what you haven’t built yet.
Investors, on the other hand, are usually asking something else entirely:
What have you already figured out without my money?
Which risks have you already addressed?
What exactly will capital unlock next?
This mismatch can lead to frustration and failure at worst, or at best misaligned expectations.
Founders feel like they’re being asked to prove too much too early.
Investors feel like they’re being asked to take blind risk.
The paradigm shift most founders need
Here’s the shift that usually takes time (and some rejection?) to internalize:
You don’t fundraise the moment you need help.
You fundraise when you’re ready to show how far you’ve already come.
That sounds counterintuitive at first, especially if you’re bootstrapping, stretched thin, or operating in a smaller ecosystem.
But globally, this is how experienced founders eventually start to see it:
You don’t raise money because you need it, or when you need it.
You raise money because you’ve reduced enough uncertainty that capital can accelerate you.
Pause. Read that again.
If this doesn’t make sense to you yet, that’s okay. For many founders, it only becomes clearer through conversations with investors over time.
How investors think about “readiness”.
One useful way to answer the question “Am I ready to raise?” is to look at it from the investor’s lens.
At pre-seed and seed, investors aren’t looking for certainty. They know that’s impossible.
They’re looking for evidence of learning. That as a founder you’ve been through enough cycles to pick up on patterns.
Usually, that maps to four types of risk:
Problem risk - Is this a real, painful problem for real people?
Solution risk - Does your proposed solution actually work in practice?
Market risk - Is there a reachable group of people who want this?
Execution risk - Can this team realistically build and deliver it?
You are not expected to remove all of these. You are expected to clearly show:
which ones you’ve already reduced
and which ones the next round of capital will help you tackle
That clarity is what “readiness” actually looks like.
What’s worth considering
Instead of asking:
“Am I ready to raise?”
A more useful question might be:
“What have I already proven without money — and what am I hoping money will help me prove next?”
If that answer isn’t clear yet, it doesn’t mean you’re behind.
It usually means you’re still in the building phase.
And that is just as important.
Until next time -
Walaa
Node — Building Fundable Founders
P.S. If this brought up other questions for you, feel free to reply directly to this email. I read every response, and many of the next Node issues will come from the questions founders are actually asking.
A quick note before you go
If you’re running a startup and sending emails (to users, investors, or partners), email deliverability matters more than most founders realize — especially early on.
I’ve partnered with PowerDMARC to offer an exclusive offer to Node readers 30% off, in case this is useful for you right now.
Click here: powerdmarc.com