Raise less than you think. Then raise it faster.
Most founders ask for a number they can’t defend. Here’s how I size a first round from the milestone backwards.
Elias Brandt
Former CFO, angel investor since 2017, Hamburg. Writes a memo every second Tuesday. Not investment advice.
Style guide: how a memo looks
Every element a memo can use, written as a memo.
Liquidation preferences on one napkin
Who gets paid first when the company sells, in three lines.
The pre-seed round I regret
I invested in a round that was too big. Here is what it did to a good company.
What a SAFE actually promises
A SAFE is a promise about a future price. Read the cap and the discount first.
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Dilution, counted honestly
Count the option pool, the SAFEs and the next round together.
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The cap table after three rounds
A worked example from 100% to the Series A.
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A valuation is a story with a number in it
Investors buy the story first and argue about the number later.
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Pro rata, explained once
The right to keep your share in the next round, and what it costs you.
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Board seats at pre-seed
You probably don’t need a board yet. You need two people who answer the phone.
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Vesting for founders
Four years, one-year cliff, and why it protects you as well.
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The option pool shuffle
Why the pool is usually created before the money arrives.