Create scarcity in your financing
Tunguz describes the playbook founders use for pre-emptive financing processes: build credibility with investors first, then create a sense of scarcity, for example by updating a few VCs months before a raise and asking what metrics and milestones excite them. He lists the advantages of engaging investors early and the trade-offs, including that the process is time-consuming and may not work.
“The most effective financing processes, like the most effective auctions, create scarcity.”— Tomasz Tunguz, Building auction pressure in financings, Sep 2012
Do this
Write down this week which three or four investors you would update first and which metrics you want to beat before you contact them.