Convinced she only needed $200k, Caitlin Smith was proven wrong in her Chicago Booth "New Venture Challenge" course. Coaches had her analyze public CPG financials, revealing the massive marketing and working capital costs she'd underestimated. This academic exercise provided a critical reality check that reshaped her fundraising strategy.
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The founders leveraged their connection to Berkeley's business school as an institutional resource. This provided a no-cost environment for research, development, and testing, allowing them to vet and refine the business concept before launching.
In a venture climate dominated by tech, Simple Mills struggled to attract institutional investors. The founder succeeded by focusing on angel investors, who were more open to a consumer brand and funded her first three rounds, demonstrating their crucial role for non-tech startups.
The founder of Simple Mills pitched so many investors (8 per day) that two potentials randomly met in a Whole Foods aisle while looking at her product. This serendipitous moment led directly to her lead investor signing on, proving that sheer volume in fundraising can generate its own luck.
Caitlin Smith wasn't ready with recipes or packaging, but when a Whole Foods buyer offered a meeting, she took it. This forced her to accelerate her process and land a crucial first customer, demonstrating the power of seizing opportunities before feeling 100% prepared.
Applying the "weird if it didn't work" framework to fundraising means shifting the narrative. Your goal is to construct a story where the market opportunity is so massive and your team's approach is so compelling that an investor's decision *not* to participate would feel like an obvious miss.
Investors like Stacy Brown-Philpot and Aileen Lee now expect founders to demonstrate a clear, rapid path to massive scale early on. The old assumption that the next funding round would solve for scalability is gone; proof is required upfront.
Founder failure is often attributed to running out of money, but the real issue is a lack of financial awareness. They don't track cash flow closely enough to see the impending crisis. Financial discipline is as critical as product, team, and market, a lesson learned from WeWork's high-profile collapse despite raising billions.
Past success can create a dangerous belief that 'I know how to do this.' Second-time founders must actively fight confirmation bias. The fundraising process, even when capital is easy to access, serves as a crucial crucible to hold ideas accountable and ensure they are building something the market truly needs, not just what they think it needs.
A frequent conflict arises between cautious VCs who advise raising excess capital and optimistic founders who underestimate their needs. This misalignment often leads to companies running out of money, a preventable failure mode that veteran VCs have seen repeat for decades, especially when capital is tight.
Founders often believe fundraising failure stems from a lack of connections. However, for early-stage consumer brands with low sales figures, the real barrier is insufficient traction data. VCs need proof of scalability, like a major distribution deal, before they will invest, regardless of the introduction.