For serial entrepreneur Ted Mann, the longer he can put off raising capital, the better.
After leading four startups, Mann has learned that if you can wait to work with investors until your product has momentum, it’s much easier to raise, he said. That approach has paid off: Mann’s current company, CollX, raised a $10 million Series A earlier this year, building off years of growth.
“It’s really hard to raise external capital just based on a vision and a dream,” Mann told Technical.ly. “It’s much easier and much better, especially in the consumer space, to have a product in the market that has real traction.”
After founding trading card platform CollX, a 2023 RealLIST Startups honoree, Mann avoided raising outside capital for as long as possible, he said, relying on his own money and funds from family.
Mann said he’d rather not raise money at all, so he could own as much of the business as possible, but CollX required capital to grow.
3 lessons on securing early funding from serial entrepreneur Ted Mann
- Put off raising outside capital for as long as possible.
- Validate the startup’s product and momentum before pitching.
- Find institutional investors — not just angels — early on.
How did he know it was the right time to raise? Mann validated the business model as much as possible before seeking out funding, he said.
In other words, build a solid product with proof that it works and a solid user base. CollX had collected data on organic downloads in the app store and collectors who were scanning cards into the app.
“Really strong engagement shows that the app is quite sticky and doing what we set out to do,” Mann said. “So that makes the story, when you’re pitching investors, a lot more compelling.”
The seed to Series A jump
CollX raised a $5.5 million seed round in 2023, but Mann said he eased into the round at first, only approaching angel investors that he already knew and who had invested in him before.
When it came time to approach institutional investors, the company had enough traction and runway to land several venture firms, like Brand Foundry Ventures and Next Coast Ventures, Mann said.
A lesson learned from his past companies was to find multiple institutional investors at the early stages. It’s tempting to raise from angels and then stop, but if you push a little more and bring a little more money in, it sets the company up for future rounds, he said.
At his previous companies, Mann tried raising a Series A with all new investors, but he learned that it’s easier to raise a more advanced round if you approach investors you’ve already worked with, according to Mann.
For CollX’s Series A, multiple funders returned for a second round, plus a few new contributors.
“The bar is quite a bit higher when you’re trying to land a new investor at the Series A,” Mann said. “But it’s not nearly as challenging to show your existing investors [who] have been following your traction, following your progress, all along.”
