You’re reading an excerpt of The Holloway Guide to Raising Venture Capital, a book by Andy Sparks and over 55 other contributors. A current and comprehensive resource for entrepreneurs, with technical detail, practical knowledge, real-world scenarios, and pitfalls to avoid. Purchase the book to support the author and the ad-free Holloway reading experience. You get instant digital access, over 770 links and references, commentary and future updates, and a high-quality PDF download.
This guide covers the process of raising early-stage venture capital for for-profit startup companies in the United States.
The material primarily applies to founders raising pre-seed and seed funding, as well as angel and Series A investment; the guide covers topics related to raising from angel investors, accelerators, and venture capital firms.
This guide does not yet cover Series B fundraising and beyond.
This guide does not apply to many kinds of businesses raising funds, such as small businesses needing to secure loans from banks, the government, or friends and family. It is not written for businesses primarily relying on grants from private or public institutions.
This guide does not directly address issues related to raising or operating a venture capital fund. We recommend that anyone interested in this subject read bookThe Business of Venture Capital.
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When it comes to raising venture capital for a startup, many founders find themselves grasping at all the terms and language that get thrown around. What actually is a startup? Heck, what’s a founder? How is venture capital different from other kinds of investment? Who are venture capitalists? How do they make money? If you’ve ever nodded along to a conversation, hoping to get from context a definition of a term you think you should already know, this section is for you. Experienced entrepreneurs may wish to skip it.
Venture capital is a kind of investment raised by startups—typically by startup founders—to fund growth. Now let’s break that down.