#27 - Fake It Until You Make It - How to Raise Capital with Chris Costello, Founder and Former CEO of Blooom

In this second episode of our two-episode chat with Chris Costello, the founder and former CEO of Blooom, it’s all about raising capital. Chris first talks about becoming a self-taught student in venture capital, and what he did to prepare once he finally got in front of potential investors. He shares what did and didn’t work, and advice for spinning rejection into more opportunity. Chris and I dive more into the challenges of early-stage entrepreneurship, the significance of finding mentors and developing a filter to navigate the abundance of advice and feedback that founders receive. This is a super tactical conversation that will help any founder or investor get better and raising capital, and shed light on what’s like to be on the founder’s side of the fundraising table. 

Key Takeaways

[5:32] Bootstrapping Blooom initially before needing capital.

[7:10] How Chris became a student of startups.

[8:07] Studying Steve Jobs.

[12:28] It took Chris 130 pitches to unique investors to find 15 investors.

[14:53] Having the right mindset to pitch the dream and vision of the company.

[15:33] Techniques that help confidence.

[16:49] The importance of asking the right questions.

[20:12] Asking for email intros once you get a no.

[22:19] Having radical self-belief.

[25:49] What Chris learned pitching to different investors.

[28:02] Be precise on your use of funds.

[31:25] Finding a mainstream VC firm to act as the lead investor in your round.

[32:49] Putting a clock on your investors.

[33:17] Don’t do due diligence with all your investors.

[36:11] The two main things Chris looks for when vetting investors.

[37:03] Looking for someone who has “been there” and “done that”.

[39:25] Standardized term sheets on National Venture Capital Association.

[40:07] Working with experienced attorneys such as Cooley.

[45:33] Questions to ask strategic investors.

[47:11] Asking candidly for the reason behind the “no”.

[49:57] Why investors give a slow maybe as opposed to a fast yes.

[52:46] Finding the right set of mentors.

[54:18] Developing a filter.

[56:12] Connecting with people.

[57:22] Do backchannel diligence on them.

[58:33] Asking for the amount you need and not over-raising.

[1:00:22] Spotting inexperienced angel investors.

[1:01:09] Creating two pitch decks.

[1:02:58] Would Chris raise venture capital again?

[1:08:11] Chris’s passion for Blooom’s mission.

[1:12:51] Chris’s boutique wealth management firm, Curtis Capital Advisors.

Resources:
RBF Network
Keith’s Twitter

Keith’s Linkedin

Novel Capital

Chris: LinkedIn | Morgan Stanley |Chris’s Finovate Best of Show