There’s something obvious about investors that every entrepreneur gets wrong: an investor’s job is to end up with financial stakes in potentially successful companies and projects.
No one cares about your idea. No one believes you when you say you want to change the world. No one wants to fund your app.
That’s because there are too many people claiming to be founders out there and you’re competing with them whether you know it or not.
If you’re trying to raise money today, you should know that it’s only getting harder: the entire market is getting noisier. Everyone wants to be an entrepreneur. Everyone claims to be an entrepreneur. And your pitch is getting lost in the thick of it all.
Before you even think about raising money, you should know your space inside and out. That includes knowing which companies exist, which have raised money, which investors appear to be most active in those markets. Thankfully, AngelList makes that super easy.
Take a look at the companies that have listed themselves on AngelList. (While you’re at it, follow me on AngelList.) Use the “Market” filter to reduce the list down to the companies that are actually in your space. (Don’t forget to hit “Save” so you begin to receive the weekly emails on deals happening in the markets you select.)
Once you’ve narrowed the list down, I recommend sorting the list by the amount of money raised. Now click to open the top 10 companies in separate tabs. Now, study everything those companies have disclosed.
More founders, from all over the world, are going after the same finite pool of money. The fundamental investor-founder relationship is based on asymmetric information. The bottom line is that the investor sees (in some cases) hundreds of deals while you probably are only thinking about yours.
Whether you decide to raise outside money or bootstrap things entirely, you can’t afford to not keep an eye on your entire industry at all times.