Raising Money Before Traction, Building Investor Trust, and Leveraging Partnerships
5 Key Takeaways on Raising Money Before Traction
- Traction Comes First: Mehrsa emphasizes that “the best money is customer money.” Pre-orders, prepayments, or early commitments not only unlock revenue but also build credibility with investors.
- Show Traction Without a Product: Even without code, you can build investor trust by demonstrating interest—like Mehrsa’s Envision app prototype that secured over $1M in committed ARR before launch.
- Strategic Partnerships Create Credibility: Partnering with well-known industry players (like Carfax and Industrial Alliance) helped MintList attract dealers, investors, and customers before they had an MVP.
- SMART Goals Build Investor Trust: Regular updates with clear, measurable goals signal execution ability and help investors become long-term partners in your journey.
- Non-Dilutive Capital is a Gift: Treating grant providers like investors—with transparency and consistent updates—can unlock millions in funding while preserving equity.
Show Notes
[00:01:00] Mehrsa explains the “traction vs. resources” chicken-and-egg problem founders face.
[00:02:00] Her journey building MintList in a competitive auto marketplace.
[00:03:30] How a simple Envision app prototype won early dealer commitments.
[00:04:30] Why traction should always come before fundraising.
[00:05:20] Examples of other founders unlocking pre-orders to fund manufacturing.
[00:07:00] Creative ways to show traction without a finished product.
[00:08:20] The power of accelerators like Google for Startups and CDL to validate credibility.
[00:09:30] Why setting SMART goals is crucial for investor communication.
[00:12:00] Building trust with investors over time by asking this important question.
[00:14:50] Securing strategic partnerships with Advantage Parts, Carfax, and Industrial Alliance.
[00:19:00] Comparing parallel dependencies in B2B vs. B2C business models.
[00:21:10] Getting to product-market fit by working backwards from customer needs.
[00:24:40] How to access and maximize non-dilutive funding in Canada.
[00:28:30] Mehrsa’s framework for breaking parallel dependencies by adding new parameters.
[00:30:20] The importance of mentorship and not building a startup alone.
