"Our startup is low on cash, We need to raise to stay afloat.. surely current investors will protect their investment.. surely we can raise this from new investors with 'so much money' out there... after all we're growing!!"

Me: hmm, not really..

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First lets get a few basics out of the way

1/ You are not your startup (h/t @ericbahn)
2/ Your investors are not your friends
3/ Your life is not over if your startup dies
4/ Yes, these are high class problems.
5/ Yes the media only reports on successful startups.

Here's the most uncomfortable truth of all:

Your decisions are the reason the startup is here.

Not the environment.
Not the world.
Not the investors who passed.
Not the customer who churned.
Not the employees who flaked.

Your decisions.

Startup paths are notoriously non-binary even though everyone likes to write history as if it was a straight line filled with Yes / No Magic 8-ball answers.

The truth is everyone around you is just saying:

"Ask again later"... And as Ross says

"Later is NOT GOOD ENOUGH"

So that is where you take the decision with not enough information..

You hire the wrong person.
You worked on the wrong problem
You don't fix the customer funnel
Hell, you just don't have enough cash to grow fast.
Or you're trying to pivot..

Most common reasons for a startup cash crunch:

- Raised too little; didn't hit milestones
- Raised a lot; made mistakes
- Raised enough; bleeding like crazy
- Did not raise; struggling to manage cash

You usually have 1-3 mo cash or expect cash from 3-5 sources that are behind..

Most Investors do not empathize at a financial level with founders

The *nicest* investors empathize at an emotional level with you.

But they're thinking:
"Will this become a pattern?"
"Is the ride worth the pain?"

"YOUR URGENCY IS NOT MY EMERGENCY"
- @davemcclure

Even the Investors who do empathize with you financially have to worry about:

- Fund Economics
- Portfolio Construction
- Follow On Investment
- Downstream Signal
- Use of Funds

Wiring you money takes away follow on $$ from other port cos. $$ that could return the fund.

Here's a non-prescriptive list of thoughts:

- You can save this startup with what you have.
- You haven't tried everything yet.
- Make a Plan B, C, D, E, and F. Usually Plan F works - so do that first.
- Cut burn to 1/3rd of your "safe" burn number.
- Control what you can.

At my last startup we went thru a "near-death" cash experience 14 times.

Investors saved us 3 times. Collections and Debt saved us the other 10 times.

We were growing 5X YoY on millions of revenue.

(We still hit a wall at 60 mph & died)

Bottom Line:

Investors will not write you a check to save you. If they do write a check its because they expect to win. Not because they care about you.

Your team is not going to solve this crisis for you. They are looking to you for leadership and solutions.

Best of luck!