When going about raising money for your venture, it’s best not to be an asshole. “I think if you’re an asshole, you’re going to get derailed,” says Evan Loomis, a former Wall Street investment banker turned entrepreneur, mentor, and co-author of Get Backed. “Because people almost never give anyone money unless they like you.”
Loomis, and co-author Evan Baehr, who earned an MBA from Harvard Business School in 2011 and has founded multiple ventures, released Get Backed last month. The book, which is already gaining traction and earning praise from fellow entrepreneurs, focuses broadly on building relationships as a way of raising early-stage funds.
And the two would know. Over the past three years, the two have raised $50 million combined for their own ventures and counseled many others to do the same. Through his small business online lending platform, Able, Baehr aims to serve the Fortune 5 Million–the 5.8 million small businesses identified as the “backbone” of American economy.
Inside the book, which catapulted to the top of Amazon’s business new release list, the Evans break down pitch decks from 15 startups that have raised a combined $150 million. It’s essentially a step-by-step fundraising how-to manual for gaining early support.
The friendship between the two is evident as they playfully call each other out on answers throughout the exclusive in-depth interview with Poets&Quants. Here, Baehr and Loomis discuss everything from the importance of relationship building to a potential startup funding bust to why Baehr talked Loomis out of getting an MBA from Northwestern’s Kellogg School of Management to start a business instead.
Poets&Quants: What problem were you trying to solve by writing Get Backed?
Baehr: The problem we were trying to solve is that many early stage founders have a sound idea, ample enthusiasm, and sometimes, even some early traction. But, they have no idea how to raise money for their business. That is an especially problematic situation because raising capital is often the white blood for the possibility of making a business succeed. So capital is needed to even determine if there is possibility of a successful business.
Loomis and I had met with hundreds of early stage founders, just as friends, to brainstorm with them on how to get some capital for their business. And we wanted to take our learning through those conversations and our own ventures that we have raised capital for and put it in a format of a book and online content to make that information accessible to everybody. And make it available to anyone building a company. Because we really believe that fundraising is a teachable skill. And that there are great people with big ideas [who] deserve to raise capital that aren’t currently able to. So we’re helping them overcome being stuck.
Loomis: The only thing I’d add on top of that, they don’t really know where to start. But for many [who] would start to raise money, they would jump in without a good coach by their side or without the knowledge of how to handle this and would more often hurt a number of relationships with their friends and family. As you can imagine, the startup founder typically looks to friends and family first when they’re raising money and that can get to be a little bit of a dicey situation if they’re not honest. And so what we found from one of our friends and people that we interviewed is that not only did they not have a field manual for raising money, many even had the worst experience, which is no money and a lot of burnt relationships.