Navigating early-stage startup funding with Dealum and NuFund experts

The live discussion featured prominent figures in the venture capital space: Pankaj Kedia, founder and managing partner of 2468 Ventures, Serhat Pala, co-founder of Cross Ocean Ventures and president of NuFund Venture Group, and Steve Walsh, founder of Hands On Angel. Darja Ogorodnik, the business project manager at Dealum, hosted the panel. Together, these investors and entrepreneurs unpacked common misconceptions, challenges, and best practices in fundraising for startups.

Understanding risk: The investor’s perspective

One of the central topics in the discussion was the importance of understanding and addressing risks when presenting to investors. Serhat Pala, drawing from his extensive experience on both sides of the table, emphasized that founders often misunderstand what investors seek. "The number one common misconception I see is that founders think investors are looking to minimize risk, but in reality, it’s about understanding the risk," he shared. He further explained that investors aren't deterred by risk itself but need clarity on how founders perceive and plan to mitigate those risks.

Echoing Pala’s point, Pankaj Kedia highlighted another frequent issue: "Many founders get caught up in pitching their product or technology, but investors care about the business, not just the product." Kedia encouraged founders to focus on credible market projections rather than inflating numbers, advising that "credible numbers are better than bigger ones."

Preparation is key: Building relationships and doing the homework

Steve Walsh reinforced the importance of preparation, particularly for first-time founders. According to him, many founders underestimate the time, effort, and number of conversations it takes to close a funding round. "I closed a round last week that took seven months and 225 conversations," Walsh said, emphasizing that successful fundraising requires more than a good pitch—it requires resilience and strategic planning.

Walsh also underscored the value of researching potential investors thoroughly before reaching out. "With a little bit of research, you can find your match," he said, adding that founders who fail to do their homework waste both their time and the investor's. Platforms like LinkedIn, Signal, and Crunchbase provide critical information that founders should leverage to target the right investors, saving time and increasing the chances of a successful pitch.

Selecting the right investors: Alignment and compatibility

The panelists agreed that finding the right investors goes beyond securing a check; it's about finding partners who align with your company's vision and growth trajectory. Serhat Pala pointed out the importance of choosing investors who can help a company at its current stage and lead it to the next. "It’s about compatibility—what do you need most help with, and can this investor take you there?" Pala explained.

Kedia added that transparency and integrity are crucial in attracting the right investors. He noted that founders should be straightforward about customer traction and revenue. "If someone’s not transparent, it's a big turnoff," he said. For Kedia, positioning pilot customers as paying clients or overplaying logos is a red flag that can kill an investment opportunity.

Navigating the U.S. market as an international founder

For founders outside the U.S., entering the American market can seem daunting. Kedia and Pala, having worked with numerous international startups, stressed the importance of full commitment when expanding into the U.S. market. Pala advised founders to commit resources and time to ensure their product and go-to-market strategy fit the U.S. context. "Marketing and product market fit might need to be adapted," he warned, urging founders to avoid treating U.S. expansion as an afterthought.

The discussion also touched on the challenges faced by underrepresented founders, including immigrant entrepreneurs. Walsh, whose portfolio includes a significant number of underrepresented founders, explained that these founders often exhibit a unique grit that gives them a competitive edge. "Great founders can come from anywhere," he said, noting that this is an unwritten rule he follows when selecting founders to back.

The investor’s role in startup success

The panel closed with reflections on the investor-founder relationship and the long-term nature of venture-backed companies. Walsh summarized it well: "I don’t want my founders to do everything I tell them, but I want them to hear everything I say and implement what’s best for their business." Kedia and Pala agreed with this sentiment, emphasizing that while investors can guide, the founder must ultimately make the decisions that shape the company’s future.

For founders starting their fundraising journey, the insights shared during the panel highlight the importance of preparation, understanding investor expectations, and building genuine, strategic relationships. By doing so, early-stage startups can navigate the complexities of funding rounds and unlock the support they need for long-term success.