I’m George Levin, CEO at Hints.

We're building a self-organizing CRM for small businesses that don’t want to invest time and effort in setting up and manually updating their CRM. 

Our system automatically creates a CRM by tracking messages across messengers, SMS, and emails.

We also provide an AI system that can add contacts, create tasks, and move deals to the next stage with simple commands.

Existing CRMs like HubSpot, Salesforce, and FireDrive are great for larger organizations with dedicated staff, but they're not suitable for small business owners who are overwhelmed. 

We wrapped up a $2.5M seed round over 2 years between 2021 and 2022. This round was a mix of party rounds and institutional funding. 

We got $1.5M from one institutional fund, and the remaining $1M came from friends and small angels — with check sizes between $50k and $120k.

We started with smaller investments of around $50k because it helped build traction and made it easier to convince the next investors to invest.

Once we had raised $500k from legitimate investors, it reassured the first institutional fund that our company had potential — and that I was a strong founder.

We decided it was the right time to raise funding because we had built some initial traction and momentum. 

We started with the goal of raising around $1M — this took 4 to 5 months. 

As we built our product and began generating revenue, it became clear that there was momentum in the market. 

My intuition told me that if we could raise more funds, it would be beneficial to take advantage — even if there wasn't an immediate need for additional capital. 

That’s when we set out to raise the remaining $1.5M of the seed round.

This turned out to be the right decision because it provided us with the financial flexibility to pivot when the market became focused on GPT and LLMs. 

Having the funds in the bank allowed us to adapt and survive through this turmoil.

We initially started with a valuation of around $6M. As we demonstrated growth and validation, we incrementally raised it to $10M, then $12M, and finally landed on $15M.

The immediate goal is to become profitable as quickly as possible.

Once we achieve profitability, we'll decide on the next steps — this might include raising our next round.

I reached out to people I knew.

In hindsight, the best way would have been to find the most relevant people, but I was too busy building the product and team to do thorough research. 

Luckily a couple of those people had big networks and knew a lot of others too.

One of my early investors connected me to ten people — five of them invested. 

This created a network effect where friends of friends were more likely to invest.

Another investor also connected me to his network — which led to more investments. 

In one case, an investor made a group introduction — this helped build trust as they were all friends. 

This network effect meant that every new check convinced others to invest, which created momentum.

I had around 150 calls with potential investors during this fundraising process.

In the end I raised funds from about 12 to 15 people — roughly a 10% conversion rate.

The main selling point was that I sold my previous company. It showed them I had been through this whole process before.

They also knew I could fundraise, which was crucial because they didn't want to be the only ones investing.

The team was very important as well. We knew each other for a long time. My co-founders came from my previous startup — we had worked together for years. 

We also started using LLMs in our technology before they became widely known. Investors were impressed that we were working with AI models before ChatGPT even came out.

I wish I used unique tactics — but I didn't. 

The downside of party rounds is that you get those first checks and suddenly have enough cash to run your company. 

You start thinking, "Okay, I have $500k and my burn rate is only $20k, so I can keep raising in a few weeks." 

This led to periods where I'd raise funds aggressively for 3 or 4 weeks, having 5 calls every day, and then pause for a few months. I now see that was a big mistake.

This approach made it hard to set a formal deadline for the raise. I couldn't tell investors I'd stop raising by a certain date — because I was essentially raising continuously. 

I tried to be transparent and cool, but it never worked out as planned. I would end up sending follow-ups months later — trying to raise more.

I kept investors interested by maintaining momentum during those aggressive fundraising periods. 

I made sure to have as many calls as possible in a short period — which created a sense of urgency. 

Being transparent about our progress and challenges also helped build trust.

I also leveraged my network effectively — early investors who were well-connected introduced me to other potential investors.

This social proof was so important in terms of convincing others to come on board.

The challenge came when I ran out of my connections from my immediate network and friends-of-friends — but still needed to raise more. 

I turned to cold outreach. Even though it’s not the best approach, it worked for me because of my experience with email campaigns and copywriting.

I found some investor databases and crafted emails that were transparent about the situation. 

I made it clear that I was reaching out cold and was even a bit apologetic about it — rather than pretending we had a prior connection. 

This honest tone helped in coming off as more genuine. Even though the conversion rate was low, I ended up getting some excellent leads from it.

Based on dozens of conversations with first-time founders, be prepared for fundraising to be much harder and take much longer than you think. 

Really consider if this is the best use of your time because there might be other options.

It can seem glamorous when you see people on Twitter or read about big fundraising rounds — it's not as simple as sending 50 emails and getting a check. 

It's more like magic than work, especially if you're not a founder who has exited before.

Find co-founders who can keep building the product, or consider not building the product at all initially. Raise money on the idea and the deck first — then build the product. 

You can't do everything simultaneously. You need to spend more time on raising than you think.

In my case, I was lucky to have co-founders who managed everything while I focused on raising funds. When I was in fundraising mode, that was all I did. 

Also, compromise on quality. Make everything 2x as fast. If having to decide between quality and speed — I’d optimize for speed.

I really like everything YC has posted, especially their videos on fundraising. They've become classics for a reason — they make a lot of sense. 

One major piece of advice I've realized is that fundraising is best done by connecting with founders rather than directly reaching out to angels and investors.

Reaching out to big names usually doesn't work because they probably won't care or respond. 

If you know good founders and build trust with them on a personal level, you have a much better chance of getting introductions. 

The worst experiences I've had are with random people who know I’ve raised money and then pitch me aggressively — asking for connections to investors. It's outright disrespectful.

The best approach is to hang out, build trust, have a few meetings, show your product, and ensure I understand and like it. 

Then when you ask for an introduction it's much more likely to be successful. I'm always happy to recommend and help good people I know and trust.

All the best introductions I got were through founders I had built personal relationships with — not just random founders. This approach brought in more leads than any other strategy. 

Focus on building genuine relationships with founders who can vouch for you and your product.