Fundraising for a Legacy

The legacy approach is entirely different and should be understood by all entrepreneurs before seeking capital

I have heard a number of investors from different walks share their views on the ‘correct way’ of fundraising. I believe there is no single ‘right way’, but instead, it depends on preferences for both an investor and entrepreneur.

The same goes with valuation. The way an entrepreneur and investor align on valuation has to do with the level of realism towards the future and the company’s goals. This is why fundraising (and valuation being a byproduct of it) is more of an art than it is a science. I would say it is more about understanding investor psychology than it is about numbers (to a certain extent). There are foundational laws around it, and one needs to know the numbers that matter. Beyond that, one needs to align on the future goals and level of confidence of each investor. That level of confidence is determined by (1) how you sell your company and (2) whether what you say resonates with the potential investor. Number 2 could result from many factors, such as the investor’s background, experience, and optimism.

What I can share is what has worked for me, but I take a longer-term approach to things, and this requires a more patient way of growing. This is a result of my preference of owning assets forever with the aim of building legacy assets, and hopefully seeing my kids continue that legacy in the future (if they choose to do so).