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You Failed Before You Started

Here is A Bullet-Point Guide to Avoiding Fundraising Mistakes.

After working with over 350 high-level executive clients in the last six years, I’ve noticed a recurring theme:

The ones who failed, failed before they even started raising funds.

Here’s why and how to fix it:

?Why Companies Fail Before They Start

The Wrong Offer:
Many founders use a subjective approach to create their offer.
This is the most critical step in fundraising—a wrong offer equals failure.

? Reality Check:
Pre-seed investments are often based on relationships and belief (friends, family, close connections).
At the seed round, you’re raising $1M+ from sophisticated investors who value:
1.Valuations
2.Projections
3.Balance Sheets
4.IP Value
5.Competitor Analysis

Mistaken Beliefs:
Founders often argue valuations based on belief alone, thinking they’re on "Shark Tank."
Real-world investors don’t work like that. If you want their money, you must align with their valuation.

? How to Fix Your Offer and Avoid Failure

1. Start with Competitor Research
Identify competitors in your market.

Find the company with:
The highest valuation or
The most successful buyout in your industry.

2. Break Down Their Success
Analyze what it took for them to reach their valuation:
Revenue
Costs
Operations
Logistics
Marketing and Sales
Technology

? Example:
Competitor sells 10,000 products at $100 = $1M revenue.
You’ve sold 10 products at $75.
Create a detailed plan showing how you’ll scale to $1M revenue.

3. Build a Financial Model
Project what it takes to reach a high revenue target (e.g., $1M per month with 30% profit margin).
$12M annual revenue with $3.6M profit.

4. Use a Simple Valuation Method
Apply a revenue multiple:
Example: $12M revenue × 3x multiple = $36M valuation.

5. Frame Your Seed Round ?
With this model, present your company as having the potential to be worth $36M.
Raise $5M by offering 15–20% equity (market-aligned).

Why This Works
Investors will see your valuation as market-based rather than belief-driven.
You’ll demonstrate a clear, proven plan to reach your target valuation.

?Key Takeaway
Don’t fail before you start.
Fix your offer. Build it on real data, competitor insights, and a sound financial model.

This is how you succeed in raising funds.

Are you coming to Dubai to meet investors and partners?

Visit my LinkedIn profile and send me a DM.

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At DMFunder, we help B2B tech companies generating at least $500K in revenue secure high-value clients and grow their revenue by $1M to $5M using a proven outbound system—without relying on ads or cold emails.
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