By the fundraising stage, a founder already has a strong startup concept based on consumer-centric data. Their minimum viable product (MVP) demonstrates promising product-market fit. They're also confident that their venture provides a solution to a real-world problem.
Now, they need to determine which funding route to pursue. Should they bootstrap with friends and family, focus on non-dilutive funding, or seek venture capital (VC) funding? Among the options is applying to Columbia Business School's Lang Entrepreneurial Initiative Fund, which typically provides $50,000 to $100,000 in exchange for equity.
Regardless of the path they'll take, founders need to know how to pitch their startup—and themselves. Professor Angela Lee, faculty director of the Eugene M. Lang Entrepreneurship Center and founder of the investing network 37 Angels, advises against making these overtures too product-centric. “The product is only one part of the story,” she notes. “The team, the business model, and how you'll acquire customers are also critical.”
The Four Ps
In fact, Lee's Foundations of VC course (also offered through CBS Executive Education) outlines a framework investors can use to diligence startups based on the four Ps—and product isn't one of them. They include:
- People: Does the team have the right expertise and it factor?
- Problem: Is the problem large and the customer well-defined?
- Progress: Is there a sustainable and scalable customer acquisition model?
- Price: Does the valuation make sense?
In the people pillar, investors have a hawk-eye on leadership. “VCs are looking for founders with grit, empathy, and a willingness to pivot when the customer, market conditions, or evolving technology demands it,” says Lara Hejtmanek '99, managing director of the Lang Center.
When addressing the problem pillar, entrepreneurs must assess: Is the market large enough to be interesting to investors? How navigable is the competitive landscape?
Progress refers to how much traction a startup has built and if it has developed a repeatable customer acquisition engine. It's also where founders will demonstrate if their business model and product development roadmap make sense.
Finally, price indicates the attractiveness of the deal from an investor's standpoint. Are the terms fair? Are there any issues with the capitalization table—the chart that shows ownership stakes in the business? What's the cyclicality of revenue, and how sustainable is it? “Investors are less interested these days in financing a company that has $1 billion in revenue but is still unprofitable,” says Lee.
In addition to Lee's Foundations class, students can learn to manage this stage of the startup journey in a number of CBS courses, such as Entrepreneurial Finance, VC Seminar, and Investing in Social Ventures, among others.
A Numbers Game
The amount founders hope to raise will also dictate the level of readiness they need to achieve. If they're looking to raise less than $1 million in pre-seed funding, an MVP is enough to get started. For a larger seed round, they'll need customer traction. When raising a Series A, for instance, a common milestone is $1 million in revenue.
Demonstrating growth—ideally 20 to 30 percent month over month—and customer engagement is another imperative. “If 10,000 people download your app but no one's engaging with it, it's not fundable,” says Lee.
Lee also recommends entrepreneurs analyze what percentage of revenue is tied to one customer—and how long it typically takes to acquire a new one. Founders should expect to be grilled on every figure in their deck. “If you have 95 percent customer retention, an investor will ask why 5 percent are leaving,” says Lee. “They'll want to know if you've addressed those reasons.”
A Smart Strategy for Fintech Fundraising

Laura Kornhauser '17 and co-founder Dmitry Lesnik launched Stratyfy in 2017 with the goal of accelerating financial inclusion for underserved communities while mitigating risk for financial institutions. The company's patent-pending engine leverages human-in-the-loop machine learning across product offerings that optimizes credit decisions, mitigates bias in models, and enhances risk management for financial institutions.
As Kornhauser and Lesnik prepared to raise capital, Stratyfy focused on three pillars: proof, timing the raise, and community. They successfully onboarded customers, built a strong team, and achieved impressive growth metrics, establishing the proof points needed before seeking funding.
The founders' networks were pivotal. “While a powerful network of advisors and supporters facilitates connections to capital, it was our network of founders that helped us celebrate the great days and persevere the toughest days in fundraising,” says Kornhauser.
Support from CBS, including courses and clubs like the Columbia Entrepreneurs Organization, also provided assistance. The Lang Fund's participation in Stratyfy's seed round bolstered the startup's credibility, allowing it to attract top-tier talent while expanding.
Stratyfy recently announced a partnership with Beneficial State Foundation's Underwriting on Racial Justice Program, a ground-breaking program to minimize racial disparities in lending. As part of the program, 20 lenders will leverage Stratyfy's technology to predict creditworthiness without bias and refine their loan policies to drive fairness.