Some tips for raising money in 2025

As a journalist turned investor, one of my absolute favorite ways to spend my time is to get deep with founders as they kick off a capital raise. Creating materials, including decks, memos, and a data room, can take a very long time. Not to mention the pitch prep, the investor target lists, and all the meetings. I’ve been a coach to a group of founders going through this process - and in most cases, it’s a grind.

So I asked one of our regular contributors — 7wireVentures’ Alyssa Jaffee, to share a shortlist of tips for founders embarking on a raise. And I added a few of my own, which are specific to 2025. I am wary of making predictions, but what I’ve heard from my network is that pre-seed and seed activity is going strong in health tech (especially for AI), while the hardest rounds to raise are at the Series B and C. I think of this as the “post Product Market Fit” stage of the business, but well before it’s a growth-stage round, and the bulk of the diligence will be done on Excel. At the B and C, it’s still imperative that the investor be a true believer in the business because the numbers will rarely speak for themselves.

Bottom line: Anything without AI that’s more services-oriented will need to find the right fit in the venture capital world. There are certainly still a lot of investors who can get behind these businesses, but there’s more discipline now than ever before about valuation. These companies should not be valued like software businesses because they’re not.

With all that said, here are some tips from Alyssa that I believe you’ll find useful!

And a few of mine:

1. Start with a few “friendlies” who probably won’t invest in the business but will give you very direct feedback.

2. Think up all the reasons why an investor would say no, and consider what you’d say in response to those concerns. And this is critical — validate them first. Then, find direct or indirect ways to address those potential risks in the pitch deck (or in the voiceover that accompanies the deck).

3. Don’t get too wedded to the deck! You will certainly need one, but don’t feel you need to use it in every conversation. Sometimes an investor will want to get to know you instead, and will have already reviewed your materials going into the meeting.

4. Do your homework. I cannot tell you how many hours get wasted on investors who will never write a check. Leverage your network to find out who’s still active because there are a lot of zombie funds out there, and that’ll be even more true in 2025.

5. Keep investors in the loop who could come in at the next round. There’s no harm in asking if they’d like to be added to your investor update email. It’s a wonderful way to keep them warm without doing much additional work. (Separately, I have a LOT of thoughts on the right way to do an investor update - so if anyone is interested in a post on that, let me know!)

Alright, that’s it for now. It’s been a big year for Second Opinion, and we have a ton of great content coming up in 2025, starting with two long-form analyses on health and cybersecurity, and menopause. For those who subscribed this year, I appreciate you so much for supporting me! It means the absolute world. Happy holidays.