As Startups.com and Fundable founder Wil Schroter likes to says, “There’s not a lot of ‘fun’ in funding.”

Raising equity funding for your startup is a long, difficult, and often demoralizing process. However, if you’re successful, you walk away with money that will help your startup grow and become everything you hope it could become.

But despite these challenges, thousands of startups raise funding every year, implying that the potential rewards outweigh the guaranteed strife and risk. Here’s an outline of what a startup founder can expect at each startup funding stage.

Pre-Seed Funding

Pre-seed funding is the earliest startup funding stage, so early that many people don’t include it in the cycle of equity funding.

At this stage, founders...

It's ridiculous to think that anyone will ever be as committed to a startup as the Founder.

And yet, we're constantly beating ourselves up trying to find just the right combination of great hires, strong incentives, and attractive growth to convert all of this raw talent into the committed, startup-building machine that we've become.

But it's 3 a.m. and we're sitting in bed staring at the ceiling completely engrossed in nothing but the future of this startup. Why isn't everyone else? Is there some sort of magic formula that would convince the rest of the staff to also be sitting in bed staring at the ceiling? (In this scenario we're assuming we'd want people to do that...)

It's time we realize, as Founders, that expecting the same level of ...

Let’s face it. Bootstrapping sucks. In theory, it should be liberating to be self-funded and self-sufficient at the early stages of running a business. But reality is much less glamorous. For one, we’re small peanuts surrounded by unicorns: our presence in the media, as a result, is almost zero. We’re competing with 10-figure marketing budgets and grinding our teeth to get there. We spend more time scratching our heads than making actual decisions.

Then, we see success stories like Basecamp, a company that could have been a unicorn but chose not to—growing to 50 employees and a customer base of hundreds of thousands along the way.

Holy shit, maybe it is all worth it.

While founders in the VC world are chasing their burn rates, Basec...

“Did you hear about XYZ.com? I just read about them yesterday. They raised a $5 million round from a top tier venture firm at a crazy valuation. It’s like they popped up overnight!”

Ah, the familiar refrain of “instant success.” The press loves you, investors love you, everyone wants to high five you and join your mission. You’re on your way to becoming the next Google, right?

Not exactly.

Well, unless in that same minuscule time period you’ve managed to build a profitable business with a sustainable customer base and cornered your market, you haven’t proven anything.

Success doesn’t come instantly, and it sure as heck doesn’t come from big announcements. It comes from a long term dedication toward building something real.

Launching Isn’t S...

The biggest challenge Founders face when finding a co-founder is determining how much value they will truly add. We have to realize that in the formative stages of a company, we are in a very leveraged and vulnerable state. We don't have the funds to pay people, no one is clamoring to work with us, and we're pretty much all alone.

This is where we make some of the most costly mistakes we could possibly endure. We place all of the value on someone based on who happens to be available right now and then give them the most valuable currency we will ever create.

We do this in the name of progress, but are we really asking the right questions?

Is One Person Worth 50% of our Net Worth?

The moment we take on a 50% co-founder the business needs to ...

It’s hard to decide who has changed the most in the last 12 years: Thrillist or its co-founder and CEO Ben Lerer.

Back in 2004, Thrillist was frequently described as the male equivalent of DailyCandy, a female oriented email newsletter that sold for $125 million only to be killed by Comcast. To be clear, that is still one of the largest content exits in the Web era, and it inspired plenty of envy at the time. Many expected Thrillist to be flip-bait as well.

Fast forward to today and Thrillist has raised more venture capital than that DailyCandy acquisition– much of it during a $100 million mega round announced last year. That deal rolled up Thrillist and three other media platforms into one company called Group Nine, and Discovery invested ...

I never expected to be an entrepreneur. My first business, the mobile user interface (UI) company The Astonishing Tribe (TAT), was set up by six friends who wanted to work with something we loved and learn from our own mistakes rather than from others’. I am not even sure that it actually felt like a startup. TAT became a completely unexpected giant success both personally and financially (the business was bought by Blackberry for $150 million).

When I started my second business, I wanted more than financial success; it had to mean something to me. I believe that an entrepreneur’s true purpose is to try, learn, and experiment rather than follow more conventional ways of achieving success. Therefore, there is more room for failure, which is ...

WHAT IS SOLE PROPRIETORSHIP?

A sole proprietorship is an unincorporated business owned and run by one individual with no distinction between the business and the owner.

Sole proprietorships are the simplest and most common form of small business ownership, representing 73% of all small businesses in the United States today (a total of 23 million were reported by the IRS in 2010 and again in 2018 by the small business administration (SBA)).

The business owner is entitled to all profits and is personally responsible for all of the business's debts, losses, and liabilities, and pays personal income tax on profits earned from the company. The owner is not required to formally register their business with their state as corporations or LLCs do.

With...

Before GirlBoss was a book or a Netflix show or a hashtag, Sophia Amoruso was running NastyGal and reticent to even sit on stage and be interviewed. She finally relented, and this was one of the first she’d ever done.

This interview was situated almost exactly between a five-year, almost effortless success story of growth, and a five-year slog that ultimately ended in bankruptcy.

But while NastyGal ultimately didn’t work, Amoruso continues to find ways to productize her unique attitude, style and eye. In addition to executive producing the Netflix show based on her life, she’s recently launched a media company for women called GirlBoss Media.

I have mixed feelings on the show and the direction of her media company, as a woman who doesn’t pa...

Owning 100% of an asset is the same as owning 0% if it's never liquid.

Too often we get hung up on what percentage of a company we own, only to overlook the fact that our equity actually doesn't matter at all unless it's liquidated at some point.

In this case, we're specifically talking about ownership that requires a sale to have value, not two gals in a room splitting annual profits 50/50 (that percentage does matter in that case!).

Optimize For Probability Not Percentage

Part of where we get distracted is focusing so heavily on how much of the company we have instead of the probability that our ownership will even matter. The broken assumption here is that all probabilities of exit are constant, and the only variable is how much of the ...