When thinking about how much money you should raise from investors, think backwards. First, figure out which milestones you want to hit. These should be meaningful BHAGs – Big Hairy Audacious Goals. Usually, these milestones are achievable in an 18-24 months timeframe. Then, you have to build a plan in reverse that is designed specifically to achieve the milestones you created in the future. In this way, you are actually building your plan backwards, starting with the milestones in the future and working in reverse to the present. Building out a detailed financial model of what will be required to achieve those milestones gives you the total amount of funding you’ll need. And be sure to add a small buffer for unknowns along the journey.
