10 Fundraising Myths Founders Still Believe (And the Truth)

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Let’s get real.

Most founders are operating with a broken playbook when it comes to fundraising.

The market has changed.
Investor behavior has evolved.
But too many startup founders are still following outdated advice from 2018 Twitter threads.

In this post, I’ll break down the top 10 fundraising myths — and the hard truths founders need to hear in 2025.

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1. Myth: You need a product to raise capital

Truth: You need a compelling narrative — not code.

Investors back vision and momentum.
Plenty of $1M+ rounds have closed with just:

• A bold insight
• A clear market gap
• A founder with founder-market fit

👉 For proof: Raising Money Without a Product: Debunking the Myth

2. Myth: VCs only fund Delaware C-Corps

Truth: Structure matters, but traction trumps all.

You can close angel rounds as an Aussie Pty Ltd, a UK LTD, or even a DAO.
Delaware comes later — not first.

3. Myth: Warm intros are mandatory

Truth: Cold emails still work — if you write like a human.

Founders are landing checks every week through:

• Personalization + relevance
• Great subject lines
• Killer follow-ups

👉 Templates here: 15 Cold Email Templates That Actually Work for Fundraising

4. Myth: You need a perfect pitch deck

Truth: Decks don’t close rounds — conversations do.

Most investors skim decks.
What matters is clarity of story, traction, and “why now.”

👉 Read: How to Craft a 5-Slide Deck That Actually Works

5. Myth: You must be based in SF or NYC

Truth: Geography is dead.

We’ve seen founders from:

• Nigeria
• Ukraine
• Australia
• Philippines

…raise their first $500K–$5M with the right proof points and storytelling.

👉 See real paths: How 5 Founders Raised Their First $1M

6. Myth: Investors care about NDAs

Truth: Asking for an NDA is a red flag.

Serious founders know:
Execution > Idea.
If you're scared someone will steal it, you're probably not the one to build it best.

7. Myth: You only need to pitch once

Truth: Fundraising is a follow-up game.

Most rounds are closed after:

• 2–3 investor calls
• 3–5 follow-up emails
• A warm intro after the cold start

👉 Guide: How to Master the Fundraising Follow-Up Game

8. Myth: A big round = success

Truth: A big round = a bigger target on your back.

The real flex is efficient growth, not bloated burn.
The best founders raise what they need, not what they can.

👉 Read: Why Hormozi Prioritizes Profitability Over Revenue

9. Myth: You need famous investors

Truth: You need aligned, useful investors.

Big names might signal credibility — but they won’t join your standups.

You’re better off with:

• Value-aligned angels
• Operators who’ve built what you’re building
• VCs who give real time

10. Myth: Fundraising is about convincing people

Truth: Fundraising is about filtering people.

Don’t chase every yes.
Filter out misaligned investors before they waste your time.

A great fundraise is about finding your tribe — not performing for strangers.

👉 Learn: Fundraising Is a Process, Not a Project

⚡ Quick Recap: The Truth Behind the Myths

MythTruthProduct requiredNo — narrative & momentum matter moreOnly Delaware gets fundedLegal structure is flexible early onWarm intros onlyCold works — if done rightDeck is kingConversations close dealsSF/NYC is requiredRemote founders raise every dayAsk for NDASignals inexperiencePitch onceFollow-up is the real unlockRaise big = successBurn efficiency is the new flexBig-name investorsAligned operators winConvince everyoneFilter for fit

FAQs: Fundraising Truths in 2025

1. Do I need traction to raise?
You need something. Proof of demand, users, community, waitlist — or a killer narrative.

2. Is cold outreach still effective?
Yes — especially when paired with strong positioning and follow-ups.

3. Should I work on a deck or a memo?
Both. But your memo does the heavy lifting.

4. Are VCs still investing at pre-seed?
Yes — but they expect clarity, speed, and founder-market fit.

5. How long should a round take?
Top founders close in 30–45 days. Most take 3–6 months.

6. Can solo founders raise in 2025?
Absolutely — especially in SaaS, AI, and fintech.

7. What matters most to early-stage investors?
Narrative, founder insight, traction proxy, and market clarity.

8. Should I do rolling closes or a set raise?
Rolling closes work well in early rounds. It builds momentum.

9. When do I form a Delaware C-Corp?
When you have a term sheet from a U.S. investor who requires it.

10. What platform helps most?
Capitaly.vc — founder-first, fundraising-ready.

Conclusion

Fundraising in 2025 isn’t about looking impressive — it’s about being intentional.

Ditch the myths.
Follow the truths.
And build a system that actually works.

Subscribe to Capitaly.vc Substack (https://capitaly.substack.com/) to raise capital at the speed of AI.

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