Copy Link
Two steps can change the life of any founder: moving from day-to-day operations to strategic leadership, and starting to raise capital.
Many founders find the capital raising process challenging, not because they lack interest, but because they are unsure how to begin.
No matter if you’re creating the next AAA game or launching a new blockchain game platform, you will eventually need outside investment to grow.
But what is capital raising? How should you approach it? And how can you get noticed by a gaming-focused venture capital firm like Konvoy?
In this article, we share some insights.
Capital raising is the process of getting money to support a business.
You can raise funds in different ways, from venture capital firms to angel investors.
When it comes to startups, founders usually raise capital by giving investors a share of the company in exchange for their money.
For early-stage founders, raising capital is more about building trust, showing that you're making progress, and clearly sharing your vision than it is about having a fancy pitch deck.
Capital raising generally falls into three categories: debt, equity, and hybrid financing.
Debt raising means borrowing money that you need to pay back over time, plus interest.
It does not dilute ownership, but it does create financial responsibilities.
Debt can actually have some perks. For one, it gives you quick access to cash when you need it. Also, you know exactly how much you’ll be paying back each month, which makes budgeting easier.
On the flip side, you’ve still got to pay it back, even if your business hits a rough patch.
Not to mention, it can mess with your credit score and make future fundraising tougher.
Still, if you want to go on this path, there are different types of debt:
This type of debt is backed by assets, like property. It usually comes with lower interest rates but puts your assets at risk if you can't repay the loan.
You don’t need collateral for this debt, which makes it faster to get.
However, it often has higher interest rates, so it's important to have good creditworthiness.
This debt is often used for projects that benefit society and can provide tax advantages with lower costs. However, it has stricter rules on how the money is used.
This is a mix of debt and equity.
Under certain conditions, it can change into shares in the company. It's commonly used in early fundraising to postpone discussions on company value.
Equity raising involves selling shares of your company to investors in exchange for capital.
What’s great about this kind of capital raising is that you don’t have to worry about paying anyone back, you get to connect with seasoned investors and useful networks, and it can even boost your credibility and valuation.
On the other side, though, you’ll lose some ownership and control, might face decisions pushed by investors, and end up sharing profits, which can limit your independence.
The equity sources by stage are:
We have a guide about the different stages of venture capital and how to start your own venture capital firm.
Hybrid instruments mix elements of debt and equity, giving both founders and investors some flexible options.
These tools let everyone play a bit with the terms to fit their needs.
Here are the main benefits:
However, they also come with some unavoidable risks:
At Konvoy, we’ve seen many pitches and backed several successful founders.
Here’s our recommended roadmap:
Before you seek funding, show that your product fits the market.
Whether you’re creating the next most popular game, an analytics tool, or a gaming platform, prove that people want what you’re offering.
Investors want to hear a story.
Your pitch should answer these questions:
Your team matters more than your current progress.
Investors prefer founders who can adapt, scale, and succeed.
Understand key metrics like the Total Addressable Market (TAM), Customer Acquisition Cost (CAC), Lifetime Value (LTV), and burn rate.
These numbers show investors you are ready to grow wisely.
Not every venture capitalist is a good fit for you. Focus on firms that understand your industry.
At Konvoy, we specialize in gaming, so we are not just investors; we are partners who understand your needs.
We also recommend you to read the best books about venture capital.
Capital raising is a tool, not a prize.
The best founders use investment to speed up what’s already successful, not to start from scratch.
If you’re unsure about raising capital, ask yourself if the market already accepts your product, and if you get investors, do you have a clear plan for how to use that money to grow your company or not?
Our best advice is to stay connected with the industry, so be sure to sign up for our newsletter.
Copy Link
