Funding needs differ for every single business. Some startups require employees early on while others run on a lean staff of one or two for years. That is why there is no straightforward answer to your question.
Even though I can’t just say to you right now a certain day or marker for when the funding process should begin, I can give you a number of items to think about. These will allow you to figure out exactly where you stand and that can help out with the planning process.
Is your idea fully formed?
Don’t reach out to potential investors until your business plan is ready to go. Before a friend, or the bank, or an angel investor will invest in your idea or enterprise, they want to feel like you are going to succeed. They are hoping for their money back and more.
Are your business documents and plan ready to go?
These documents are not just a formality. Any potential investor will require more than just a great idea or elevator pitch. You must show that you are serious and have thought through as many possible scenarios as possible.
How much do you need and when?
This question really is the most important. Do you need funding right now? Are you looking to hire new employees? Do you need to update your technology systems? These are the moments that startups can struggle most without the proper financing.
For more information, a great read on this very topic: When Should a Startup Founder Seek Funding?
If you’d like some assistance preparing the necessary documents or even just chatting with a knowledgeable startup attorney, reach out to LawTrades. We can help guide you through the entire startup process – from formation to financing.
Hope this helps!