Investor-Ready Plan: pitch, funding options and due diligence

01

Before you raise: do you need outside money?

In simple words

Before you ask a neighbour to buy half your lemonade stand, ask if you need a bigger stand at all. Outside money is a tool for some jobs, not a prize. Choose the tool after you know the job.

Key facts

This course assumes you finished courses 2.3, 2.3.2 and 2.3.3. In particular you need your assumptions tab, your low case, your cash flow forecast and your tested evidence. Investors read these first.
Funding routes (education only, not advice):

Route	What it is	Main trade-off
Your own savings and profit	Money you already have or earn	Slower growth, your own risk
Customer pre-orders and deposits	Customers pay before you build or deliver	Needs real demand; you must deliver
Debt (loan, line of credit)	Money you borrow and pay back with interest	A fixed payment even in a slow month
Grants and programs	Money or support from public or private programs	Rules, reporting and competition for places
Equity (angels, venture funds, partners)	You sell part of the company	You give up some ownership and sometimes some control
Crowdfunding	Many people give or invest small amounts	Strict rules in many countries; public promises

BDC describes equity financing as raising money by selling part of your company to investors in return for an ownership stake. The money does not have to be repaid. The trade-offs are that you give up a share of ownership (dilution), investors may gain a say in decisions and they share in profits. Debt generally costs less than equity and leaves you with more control, but it must be repaid. Equity is often used together with some debt.
A business can be healthy and still not be "investable". Investors who buy shares usually need a path to get their money back later, such as a sale of the company or of their shares. If your plan is a steady small business that pays its owner, a loan, savings or customer money may fit better than equity.
Honest question list before you raise: How much do I need and for what? What will change in the business because of the money? How many months does it buy (runway)? What would I do if no one says yes? Could I reach the next milestone without it?
Runway is the number of months your cash lasts: cash in the bank divided by your average monthly net cash out. Use your cash flow forecast from course 2.3.2.
No plan, deck or data room guarantees funding. Investors say no to most pitches. A "no" is information, not a verdict on you.

Step by step

Open your course 2.3.2 cash flow forecast and find the lowest month and your runway in months.
Write one sentence: what you would do with outside money that you cannot do without it.
For each of the six routes, write one pro and one con for your business, with a number if you have one.
Mark which routes fit now, which later and which never.
Write your "no money" plan: how far you can get with the first, second and third routes only.
Check: you have a runway number, a one-sentence reason for outside money (or a decision not to raise) and a fallback plan.

Watch on YouTube

Lean Startup: pivot or persevereBottomUp Skills · YouTube · youtube.com

Videos by other creators on YouTube, for reference. They are not made by or affiliated with The Future Market.

LESSON 01Before you raise: do you need outside money?

LESSON 01 / ANIMATED LESSON / AI VOICE00:00 / 01:00

Voice

Read the video script

[Host] "Before you ask for money, ask what the money is for."
[Screen: table of six funding routes] "Savings, pre-orders, debt, grants, equity and crowdfunding. Each has a trade-off."
[Text on screen: Runway = cash ÷ monthly net cash out] "Know your runway: how many months your cash lasts."
[Text on screen: Equity = you sell part of the company] "Equity is not repaid, but you give up ownership. Debt is repaid, with interest."
[Host] "Most businesses do not need investors. No plan guarantees funding."

Try it now

Write a one-page "Do I need to raise?" memo with your runway, the six-route table for your business and your fallback plan.

ClaudeStuck? Copy a ready-made prompt for Claude

Copy this, open Claude, paste it, and Claude will walk you through the lesson step by step.

For a grown-up: Claude is for adults (18+). Copy this, paste it into Claude, and use the answer to explain the lesson to your child.

I'm learning "Investor-Ready Plan: pitch, funding options and due diligence" on The Future Market. Lesson 1: "Before you raise: do you need outside money?".

What the lesson teaches:
- This course assumes you finished courses 2.3, 2.3.2 and 2.3.3. In particular you need your assumptions tab, your low case, your cash flow forecast and your tested evidence. Investors read these first.
- Funding routes (education only, not advice):
- Route - What it is - Main trade-off
- Your own savings and profit - Money you already have or earn - Slower growth, your own risk
- Customer pre-orders and deposits - Customers pay before you build or deliver - Needs real demand; you must deliver
- Debt (loan, line of credit) - Money you borrow and pay back with interest - A fixed payment even in a slow month
- Grants and programs - Money or support from public or private programs - Rules, reporting and competition for places

The exercise I'm working on:
Write a one-page "Do I need to raise?" memo with your runway, the six-route table for your business and your fallback plan.

I'm stuck. Please:
1. Explain the main idea in plain, simple words with one everyday example.
2. Walk me through the exercise one small step at a time. Ask me what I've done so far before giving the next step.
3. Don't just give me the final answer. Help me do it myself, and check my work when I share it.

I'm a parent helping my child (about 8 years old) with a lesson called "Before you raise: do you need outside money?" from the course "Investor-Ready Plan: pitch, funding options and due diligence".

Here's what the lesson says:
Before you ask a neighbour to buy half your lemonade stand, ask if you need a bigger stand at all. Outside money is a tool for some jobs, not a prize. Choose the tool after you know the job.

The activity:
Write a one-page "Do I need to raise?" memo with your runway, the six-route table for your business and your fallback plan.

Please explain this so an 8-year-old understands: short sentences, a fun everyday example, and no hard words.
Then give me 3 simple questions I can ask my child to check they understood, and a way to do the activity together, one tiny step at a time.

Open Claude

Sources

BDC, Equity financing: www.bdc.ca/en/articles-tools/entrepreneur-toolkit/templates-business-g
BDC, Cash flow forecast: www.bdc.ca/en/articles-tools/entrepreneur-toolkit/templates-business-g

My notes

I learned this

02