THE 4 STAGES OF A FUNDRAISING ROUND
The ambition of every entrepreneur is to see their project grow, conquer their market, and achieve their full vision. Often, this accelerated growth involves a stage that is both exhilarating and daunting: fundraising. Far from being a simple financial transaction, it’s a true strategic marathon, a structured journey that tests the strength of a project and the resilience of its founders.
At DB France Invest, we’ve been supporting entrepreneurs like you on this demanding path for years. We’ve found that successful fundraising almost always relies on a clear understanding of the process and flawless preparation. The secret is not to know everything but to know how to approach each phase with the right method and the right partners.
To demystify this journey, we’ve broken it down into four major fundamental stages. Whether you’re at the idea stage or ready to scale up, this guide is designed to illuminate and empower you to transform your ambition into capital.
Stage 1: Preparation – Building Unshakeable Foundations (Duration: 2 to 4 months)
This is undoubtedly the longest and most critical phase. An investment world adage says, « Never go to battle with a wooden sword. » The preparation phase is where you forge the steel of your arguments. Skipping over it is the surest way to fail.
1. Define the « Why » and the « How Much »: Your Funding Need
Before even thinking about investors, you must have a clear answer to two questions: « Why are you raising funds? » and « How much do you precisely need? » Investors fund a strategy, not a cash need. You must present them with a detailed plan for the use of funds: 30% to recruit 3 developers, 40% for a marketing acquisition campaign targeting X new clients, 30% to structure the support team, etc. This breakdown shows your maturity and strategic vision.
2. The Business Plan: Your Strategic Roadmap
The Business Plan is the cornerstone of your file. It should be the written and quantified demonstration of your ambition. More than just a commercial document, it is your management tool. It must include a detailed market analysis (size, growth, competition), a clear presentation of your solution and its unique value proposition, your go-to-market strategy, and especially, financial projections (income statement, balance sheet, cash flow plan) over 3 to 5 years. These should be ambitious but realistic, and each assumption must be justifiable.
3. The Pitch Deck: The Art of Seduction (in 20 slides)
If the Business Plan is the film, the Pitch Deck is the trailer. This concise and impactful document of 15 to 20 slides is what investors will read first. In less than 10 minutes, it should make them understand the problem you solve, the magic of your solution, the potential of your market, the strength of your team, and why investing now is a unique opportunity. Every slide matters, every word is weighed.
4. Valuation: A Delicate Balance
How do you determine the value of your company before it’s even profitable? That’s the entire challenge of pre-money valuation (the value before the fund injection). It’s a complex exercise that depends on numerous factors: initial traction, team quality, market size, technology, sectoral comparables… Proposing too high a valuation can scare off investors; too low, and you risk excessive dilution.
It’s often on this crucial point that expert support makes all the difference. At DB France Invest, we help you objectify your valuation to make it fair and credible, a prerequisite for starting healthy discussions with investors.
Stage 2: The Roadshow – The Art of Persuasion (Duration: 2 to 3 months)
Once your armor is ready, it’s time to enter the arena. The roadshow is the investor tour, an intense period of meetings and presentations.
1. Target the Right Investors
Not all investors are meant for you. A fund specializing in MedTech won’t finance a consumer mobile app. It is vital to target investors (Business Angels for seed funding, Venture Capital funds for subsequent rounds) whose investment thesis matches your sector, maturity stage, and ambitions. Quality trumps quantity.
2. Activate Your Network
In the world of financing, cold contact rarely works. The best entry point is a qualified introduction by a trusted person: another entrepreneur, a lawyer, an accountant… The network is a powerful accelerator.
Powered by experience, DB France Invest has woven an extensive and qualified network of private and institutional investors. We don’t just provide you with a list; we identify the most relevant partners and facilitate direct and credible connections.
Stage 3: Due Diligence – Under the Microscope (Duration: 1 to 2 months)
You’ve generated interest. One or more investors have sent you a letter of intent (Term Sheet or LOI) that formalizes the main terms of the proposed investment. It’s excellent news, opening the most intrusive phase: due diligence.
The investor will mandate experts to thoroughly verify all the information you’ve provided. It’s a comprehensive audit covering all aspects of your company:
Financial: Analysis of your accounts, forecasts, and their coherence.
Legal: Incorporation documents, contracts (customers, suppliers, employees), intellectual property…
Technical: Audit of your code, infrastructure, R&D.
Human: Verification of the founding team’s skills and references.
The key to surviving this step is anticipation and organization. Prepare a virtual « data room » (a secure online storage space) containing all necessary documents well before they’re requested. Transparency is your best ally.
For our clients, we systematize due diligence preparation from the start. Anticipating questions and organizing documents helps streamline this critical step and fully reassure investors.
Stage 4: Negotiation and Closing – The Outcome (Duration: 1 to 2 months)
Due diligence is validated. You’re entering the home stretch. This is where the lawyers come into play to finalize the legal documentation.
The central element is the shareholders’ agreement. This document is the « marriage contract » between you and your new investors. It governs the company’s life for the coming years: board composition, decisions requiring a special majority, liquidity clauses (exit conditions), etc. It’s a crucial negotiation where it is imperative to be accompanied by a specialized lawyer to protect your founder interests.
Once every comma is negotiated and every document signed (the agreement, the subscription bulletin…), the « closing » takes place: the funds are transferred to your company’s account. It’s the end of one process and the beginning of a new adventure, with more resources, more responsibilities, and partners by your side.
Conclusion: Your Growth is a Project, Let’s Prepare it Together
As you’ve seen, fundraising is much more than just a search for financing. It’s an enterprise project in itself, requiring method, rigor, and considerable energy. Each stage, from the initial valuation to the negotiation of the shareholders’ agreement, involves strategic stakes that will shape your company’s future.
Going it alone risks costly mistakes, precious time loss, and missing out on the right partners. Surrounding yourself puts all the odds in your favor.
At DB France Invest, our job is to guide you through this labyrinth. We bring you the expertise to build a flawless file, the network to meet the right investors, and the support to negotiate the best terms.
Your project has potential. Don’t let the complexity of financing hinder your ambition. Contact us today for a first confidential and no-obligation consultation. Together, let’s prepare your future success.