There are many articles on the subject, but for Multeam the best and most comprehensive analysis is the one produced by The Galion Project (https://thegalionproject.com/outils/galion-fundraiser-guidelines/).
To sum up, The Galion Project defines the main expectations a business leader should have when choosing a fundraiser:
“Define your fundraising strategy (amount, valuation, types of investors to target, etc.). A good fund-raiser can clearly help you in this process, and in particular prevent you from going to market with claims that are out of touch with market reality, and getting “burned” by investors.
“Establish the pitch. Clarify the pitch. The fundraiser can be a good sparring partner, but no more! It’s you, and you alone, who must have a clear vision of your strategy, business model, go-to market… A good fundraiser can challenge you, bring an outside perspective, point out weak or unclear points, but he won’t (and shouldn’t!) define your strategy and pitch for you.
“Prepare your fundraising documents: executive summary, deck, BP…”.
“Contacts and knowledge of investors: A fundraiser with a good reputation and in-depth knowledge of investors can give credibility to your startup, because he or she guarantees potential investors that the deal has already been pre-screened.
“The fundraiser added value: this lies mainly in his ability to put together a “pool” of several investors, or to seek out investors other than the well-known local VCs, such as foreign VCs, corporate funds often working on special themes, family offices with little media coverage… This knowledge of a broad spectrum of players can help to finance projects that do not fit into the “classic” investment themes of VCs, or to complete a round with players who bring business or sector knowledge”.
“Structuring a deal – Finalizing the term sheet(s): the fundraiser can help you structure a deal with several investors, bring out a lead investor, and ensure that intentions converge at the same time”.
“Negotiating the term sheet: the advantage of hiring a fundraiser is to have a negotiator on your side. He can help you understand the different offers from investors and compare them (valuation + conditions)”.
“Negotiation of documents: take on a good lawyer (!) who has experience of these transactions and knows how to negotiate, i.e. knows the market standards, the important clauses to negotiate and doesn’t get bogged down in unimportant legal details. And above all: don’t negotiate or sign a clause you don’t fully understand.”
WHAT’S IMPORTANT TO REMEMBER?
A fundraiser is not indispensable, but it will save you time and increase your chances of raising capital. In addition to his or her knowledge of investors and ability to develop the right pitch, he or she has a thorough understanding of investors’ expectations and standards, particularly in terms of valuation and entry conditions, which will help you avoid making excessive and therefore unacceptable demands or, on the contrary, failing to use all resources to achieve a better deal.
For more than 15 years, Multeam has devoted itself exclusively to fundraising.
The company has thus successfully carried out more than 100 deals.