Raising capital is one of the most important and most exhausting processes a founder lives through. Part of the exhaustion comes from not knowing whom to approach or how. Here's the map.

The main types of funders

1. Friends, Family & Fools (FFF). The first source of capital for most ventures. Money from people close to you who trust you more than the business.

When it applies: Very early stage, pre-product. What they look for: Personal trust. Little financial analysis. Risk: Mixing personal relationships with money. Always define terms in writing.

2. Angel Investors. High-net-worth individuals who invest their own money in early stages in exchange for equity. They typically also contribute experience and network.

When it applies: Pre-seed and seed. Tickets between $50K and $500K USD. What they look for: Strong team, large market, differentiated product. How to approach: Through networks like Endeavor, local angel groups or ecosystem events.

3. Venture Capital (VC) funds. Professional funds that invest in startups with high growth potential. They look for 10x returns or more.

When it applies: Seed onwards. Tickets from $500K USD. What they look for: Explosive growth, huge market, scalable model. How to approach: Cold outreach rarely works. What works is a warm intro from someone in their network. Research the fund’s portfolio before reaching out: only contact those who invest in your sector and stage.

4. Private Equity (PE). Funds that invest in more mature companies, usually with positive EBITDA and established operations. Unlike VC, they don’t look for explosive growth: they look for efficiency, operational improvement and exit in 4-7 years.

When it applies: Companies with revenues above $2M USD and positive EBITDA. What they look for: Predictable cash flow, room for operational improvement, sector consolidation potential.

5. Debt: banks and credit funds. Not all capital has to be equity. Debt (bank debt or private credit funds) is a valid alternative when the company has cash flow to service it.

Advantage: Doesn’t dilute shareholders. Disadvantage: Requires collateral and debt service regardless of performance.

6. Impact and development funds. In Latin America there are sector-specific funds for agro-industry, technology, financial inclusion and sustainability. Bancoldex, IDB Lab, CAF and regional funds are relevant players.

How to approach them correctly

First: have your information ready. Before knocking on any door you need: a clear executive deck, a solid financial model, updated metrics and a defensible valuation. Showing up without this is wasting an opportunity.

Second: personalize the message. Don’t send the same deck to 50 funds. Research each one: what stage do they invest in? What sectors? What’s their thesis? A personalized message that shows you did your homework is 10x more likely to get a reply.

Third: get the warm intro. An intro from someone the fund trusts is worth more than the best deck in the world. Work your network to come in referred whenever possible.

Fourth: manage it like a process. Don’t depend on a single investor. Create momentum by talking to several at the same time: the best terms come when there’s competition for your round.

At MOVA we help you prepare the materials, define the outreach strategy and walk you through the process so you arrive at every conversation with the best version of your company.