When should I start fundraising?

There is no calendar answer to this. There is an arithmetic one, and it works backwards from two numbers: how long a round takes, and how much runway you have.

Work backwards, not forwards

A raise in India commonly runs three to nine months from first conversation to money in the bank, and that range has been widening rather than narrowing. Diligence has become more thorough, and investors are spending longer validating whether early traction is real and repeatable.

If you begin with six months of runway and the process takes seven, you are not negotiating any more. You are accepting.

The usual guidance, and it is sound, is to start when you have nine to twelve months left. That gives the process room to take longer than planned and still leave you with a choice at the end.

How much runway should the raise leave you with?

The other half of the calculation is where you want to land. The current expectation is eighteen to twenty four months of runway after the round closes, up from the twelve to eighteen that was normal a few years ago, precisely because the next round will also take longer.

That target should shape the amount you raise, not the other way round. A number chosen because it sounds like a reasonable seed round, rather than because it buys a defined period of operating time, is difficult to defend when someone asks what it is for.

What has to be true before you start

Runway tells you when to start. Readiness tells you whether starting is a good idea. The practical test is whether these can be answered without preparation:

1. 01Do the revenue numbers in your deck reconcile exactly to your management accounts?
2. 02Can you state the definition of every metric you report, and has it stayed constant across board packs?
3. 03Could you produce your cap table, resolutions, contracts and filings this week?
4. 04Do you know which assumption in your plan, if wrong, breaks the model?
5. 05Can you name your own weakest area before an investor does?

If several of those need work, that work is your real start date. The common recommendation is a self-audit against a diligence checklist three to six months before approaching anyone, because the slowest fixes involve other people.

The case for starting earlier than feels necessary

Preparation done ahead of a process is cheap. The same work done during one is expensive, because you are doing it under deadline, in parallel with negotiation, while your leverage decreases with every week of delay.

The point of starting early is not to raise sooner. It is to still have the option of saying no.

There is also the question of whether to raise at all. Plenty of businesses are better served by validating the model further and raising later against something proven. Running the runway calculation honestly is what makes that a decision rather than a default.

Signs you are not ready to start yet

Timing is not only about runway. A few situations are worth resolving before opening conversations, because they will surface anyway and are much cheaper to fix quietly:

• ·Your last two board packs report the same metric with different definitions.
• ·The cap table does not reconcile to the resolutions, usually because of ESOP grants made without the shareholder approval to support them.
• ·A material contract or IP assignment was never formally executed.
• ·Your growth is real but recent, and you cannot yet show it is repeatable rather than a single good quarter.
• ·You do not know what happens to the plan if your main assumption is wrong by thirty percent.

None of these are disqualifying. All of them are better discovered by you than by an investor in week six of a process.

Should you raise at all?

Worth asking explicitly, because the default answer in startup culture is yes and the correct answer often is not. Venture capital suits businesses that need capital to scale something already proven. It suits validation much less well, and raising to fund a search for product-market fit tends to buy time at a high price.

The runway calculation is what makes this a real decision. If honest numbers show you can reach a stronger position on existing cash, raising later against proven performance is usually a better trade than raising now against a story.

A simple sequence

1. 01Calculate real runway on cash. Not on the profit and loss.
2. 02Decide what the raise has to buy: eighteen to twenty four months of operating room is the current expectation.
3. 03Count back three to nine months for the process itself.
4. 04Count back another three to six months for preparation.
5. 05That is your start date. If it is in the past, start now and prepare in parallel.

Most founders find the answer is earlier than they assumed. That is usually the useful part.

Who wrote this

Shafneed is the founder of Simplify, a finance clarity and investment readiness practice working with founders across India. He writes about the questions founders bring before a decision, not after it.