I see about 1,000 startups a year and invest in one or two. Here's the real conversion rate at every stage of startup funding, from first message to wired funds.
When I ask a founder to send me their deck, there's about a 1.5% chance I'll end up writing them a check. Most founders hear "send me your deck" as a really strong statement of interest. Most investors don't want to talk about how few investments they actually make compared to the number of pitches they get.
The effort an investor puts into responding tells you how seriously to take it. A deck request takes ten seconds to type. Due diligence is real work. And even a soft circle commitment, the strongest signal short of money in the bank, only turns into a wire about half the time in my experience.
In this episode I walk through my own funnel, from 1,000 pitches to 100 deck requests to 10 real conversations to one or two checks, and why it drops to zero in years I'm not deploying capital. I cover why my numbers are a floor rather than a typical figure, and what a meeting, due diligence, and a soft circle are each really worth.
Then I get into why so many commitments fall apart even when nobody's acting in bad faith, including the angel who backed out of a million dollar commitment to me at the last instant. Why a fully soft circled round is really about half funded, and why being oversubscribed puts you in a much stronger position. And the question to ask the investor at each stage so you find out where you stand sooner.
The rule underneath all of it: don't take your foot off the gas until the money is in your bank account.
Links
Pitch Audit: I review your deck and materials, then we spend an hour on exactly what's blocking your raise. $500: https://founderquest.com/pitch-audit
Full write-up: https://ftb.bz/135B
Watch the video version: https://ftb.bz/135V
Free fundraising toolkit: https://ftb.bz/raise
The PACT from Founder Institute: https://fi.co/insight/the-pact
