@mrsocial asked this question via twitter here and here.

My answer to the first question;

@MrSocial best way to raise funds: a successful mgmt team or product that is making money, got 50,000+ users or seriously world changing.

Here is my answer to the second question:

Grow little by little as quickly as you can.

If you’re idea needs a lotta money just to get started, then you’re story has to be amazing and even then it will be hard. People with money have earned it and they know what it takes, how hard it is and the risk associated. So don’t expect them to just throw you cash because you tell them you’re gonna be rich.

So think about what you can do to remove the risk of investing.

Are you an amazing person to run it? Prove it. Have you done it before? If not, then you’re going to have to do it first to show me. No money!

Is the idea already working? Prove it. Is it making money, do people love it? If not, go do it first. Sorry, no money!

So what you need to do is to grow yourself and the business bit by bit and as you do the risks will fall away.

First thing, find some way to start. Can you get a very very small version of the business up and running. Even if it’s only to one customer. If you can end to end show me that it works and someone paid a $1 for it, then we’ve cut out a whole lotta risk, including your ability to make it happen.

Typically you can do this. Stop aiming for the ‘get a million bucks, build it big and shiny, launch it and be a success’.

If you need $20k to start, and you shouldn’t need much more, then go and find people you trust. If you can’t convince family, friends and colleagues to give you $1,000 each then you won’t be able to sell to a seasoned veteran investor.

Find volunteers. Find business partners. Find companies that if you were a success, they’d benefit.
One you start growing, bit by bit, you’ll reduce the risks and you’ll be more attractive to invest in. Investors don’t invest in ideas. They invest in people and businesses that are growing and are already on their way to success.

One good tip in finding someone to invest when you’ve made a start is to read industry media and find someone who has just sold their business which is in your space and contact them. They might be bored and looking for a new adventure.

The toughest thing by far in startups is to have an amazingly wonderful vision that you believe in and can continue to live enough to motivate a team of people over a five year period…

AND

… have the uncanny and rare ability to bring that vision down to a series of probably 50+ little steps which you can execute on in sequence.

My 2 cents.

More 2 cents are here, here and here – and everywhere actually.

Pollenizer helps companies do this. I love it. Ping us if you want to chat. No obligation.

Good luck!