This article was originally published in the Spring 2025 issue of ICON/REFINED. Grab your copy here. 

Written by Craig Cecilio

A pioneering business leader who has redefined real estate investing, he’s the CEO and founder of DiversyFund. 

@cxcecilio

Raising capital isn’t just about getting funds—it’s a process of strategic growth that requires discipline, persistence, and understanding. I’ve spent over 25 years perfecting this process, raising more than a billion dollars and working with thousands of investors. In this guide, I’ll share seven proven methods to help you raise capital for your startup, each tailored to different business needs and growth stages. Whether you’re a first-time founder or seasoned entrepreneur, these strategies are designed to help you unlock the resources you need to achieve your vision.

Bootstrap with Self-Funding

Bootstrapping, or self-funding, is the starting point for many entrepreneurs. It means using personal savings or income from an existing business to fund your startup. While this may be a risky choice, it gives you total control over your company and avoids debt or dilution of ownership. Bootstrapping works best when you have a clear plan, manageable expenses, and a strong commitment to seeing your business grow. Remember, bootstrapping is often a temporary solution, but it can be a powerful first step toward building your company on your terms.

Leverage Friends and Family

Friends and family are often among the first to support your dream. They know and trust you and may be more willing to invest in your business than strangers. When working with friends and family, keep in mind that their investment is not just about money; they believe in your vision and want to see you succeed. Make sure to treat these investments professionally by clearly defining the terms, risks, and expectations. Mixing personal relationships with business can be challenging, so be transparent and keep communication open to maintain trust and protect your relationships.

Tap into Crowdfunding

Crowdfunding has gained popularity as an effective way to raise funds, especially for consumer-facing products. By using platforms like Kickstarter, StartEngine, or GoFundMe, you can reach a broad audience of potential backers who want to support innovative projects. Crowdfunding can also be a powerful marketing tool, helping you test market demand and gain early adopters. However, be prepared—running a successful crowdfunding campaign takes time, effort, and marketing skills. You’ll need to create a compelling pitch, offer attractive rewards, and actively engage with your supporters to maintain momentum.

Engage Retail Investors

Retail investors, or individual everyday investors, represent a powerful and often underutilized resource for startups. These investors are typically passionate about supporting businesses they believe in and can connect to on a personal level. Unlike institutional investors, who focus on large-scale growth metrics, retail investors are drawn to a strong mission, a compelling story, and a founder’s clear vision.

To attract retail investors, focus on sharing your business’s purpose, values, and impact on the community or industry. Create transparency by providing straightforward, clear information about your goals, your team, and how you plan to use the funds to grow your business. Building trust is essential with retail investors, as they are often investing smaller sums, but together, their contributions can add up to significant capital. Retail investors want to feel like they are part of your journey, so keep them informed with regular updates on your progress and milestones. Their enthusiasm and word-of-mouth support can also help generate interest from other potential investors. By appealing to their interests and treating them as partners in your vision, you can effectively build a loyal community of retail investors who are excited to support your startup’s growth.

Approach Professional Investors

Professional investors like angel investors, private equity investors, and venture capitalists bring more than just capital to the table—they bring experience, connections, and strategic insights that can help your business scale. Angels are typically individuals with high net worth who invest in early-stage companies, while venture capitalists manage funds pooled from institutions and high-net-worth individuals. These investors expect a return on their investment, so they will scrutinize your business model, financial projections, and growth strategy. When pitching to professional investors, remember that confidence and clear, data-driven presentations are essential. Show them you’re not just seeking funds—you’re offering a partnership with real potential.

Utilize Debt Financing

Debt financing, such as business loans or lines of credit, is an option for companies with a solid revenue stream and a clear plan for repayment. Unlike equity financing, debt financing allows you to retain full ownership of your business. However, it also requires regular repayments, regardless of how well your business is performing. Debt can be a powerful tool for covering operational costs, purchasing equipment, or funding expansion. If you choose debt financing, ensure you’re well-prepared to manage repayments and consider using collateral or personal guarantees only if necessary.

Find Strategic Partners and Institutional Investors

Strategic partnerships can open doors to institutional investors, like private funds or hedge funds, which can provide large-scale funding. These partnerships are ideal when your business has a high growth potential and aligns with the strategic goals of larger firms or institutions. Institutional investors often look for more established companies or those on a high-growth trajectory, but if your business fits their criteria, the potential funding is significant. Keep in mind that these investors will require in-depth due diligence and may want influence in decision-making processes.

Building Confidence and Connecting with Investors

Raising capital isn’t just about the money—it’s about building relationships, trust, and confidence. Here are a few key principles to keep in mind:

1. Show Your Confidence: Investors aren’t just funding your idea—they’re investing in you. Confidence is key. If you believe in your vision and convey it clearly and passionately, investors are more likely to believe in it too.
2. Do Your Research: Each investor type has unique goals, motivations, and expectations. Tailor your approach to speak to these preferences. For example, retail investors may care more about your mission, while professional investors are more focused on returns.
3. Know Your Numbers: Investors will ask tough questions. Be prepared to answer them confidently by knowing your financials, growth projections, and competitive advantages. This shows you’re serious about your business and committed to achieving your goals.
4. Keep Building Relationships: Raising capital is often about who you know. Build strong connections, network actively, and maintain relationships with past investors. Satisfied investors can become repeat backers and valuable advocates who refer others to your business.
5. Follow Up and Stay Engaged: A strong follow-up strategy is essential to keeping investors engaged and interested. Share regular updates on your progress, showcase milestones, and continue building trust even after they’ve invested.
6. Be Persistent: The capital-raising journey is rarely straightforward. You’ll face rejections, challenges, and obstacles, but every “no” brings you closer to a “yes.” Stay persistent, keep learning, and don’t let setbacks discourage you.
7. Match Capital Sources to Your Goals: Different stages of growth require different types of funding. For example, bootstrapping might work initially, but as you grow, a mix of retail investors, professional investors, or even institutional funding may become necessary. Always align your funding strategy with your business goals to make the most of each capital source.

Raising capital is a process that takes time, strategy, and resilience. By exploring these seven avenues—bootstrapping, friends and family, crowdfunding, retail investors, professional investors, debt financing, and strategic partnerships—you’ll be well on your way to securing the resources your startup needs to thrive. Remember, the key is not just to raise capital but to use it as a tool to strategically drive your business forward, unlocking growth, expanding your reach, and achieving the success you envision.