The Confusion of Raising Funds

We’re about to start a new set of products at Infinut – we’re taking our existing math concept learning apps, and extending and converting them for schools. To fund that development, I have been looking at various funding options.

  1. Angel Investment
  2. Accelerators
  3. Government Grants
  4. Foundation Grants
  5. Partnerships / Development Contracts
  6. Kickstarter
  7. Bootstrap

Angel Investment

I have now talked to a few different angel investors. The good part is that they usually make a very quick judgement on whether they want to invest with you. The bad part is that judgement is usually NO. If they want to invest, the good part is that they will move quickly. The bad part is they may have very different expectations.

Some of the expectations that Angel Investors seem to have these days.

  • That they will very quickly (2-3 years) make their money back and make a bundle.
  • The more they spread their cash – that is give less to any individual company – the more likely they are to hit a Unicorn.

This makes me feel more like investor’s lottery ticket, than a business with a purpose. It is de-motivating. In the end, I want to build a business that has an impact, not print money. It made me realize that if the investors don’t have similar goals of educating the world or involving more women-in-tech in the company, then, it will not feel like a partnership.

It is very confusing to talk to angel investors. Since anyone can be an angel investor these days, entrepreneurs don’t really know where they are coming from. Are they serious, or just exploring the idea of investing? On the one hand, entrepreneurs aren’t sure who to talk to. On the other, angel investors typically don’t market or distinguish themselves. Are they interested in education, or just spreading a wide net?


Everywhere I look, there is a new accelerator popping up. A new promise of showing entrepreneurs what to do, and putting them in touch with the “right people”.

Accelerators may be more suited to companies targeting solutions to enterprise, or enterprise consumer. The contacts, and the launch press, might be of more use for that type of company. For educational apps – targeted to parents or schools – I have come to think of Accelerators as the last option, not the first.

Unlike Angel Investors, accelerators do market themselves, and try to sell what it is they are selling. I am still not sure what that is.

Here’s some advice from Christina Bechhold on Accelerators –

Government Grants

Given the space we are in – education – there are some government grants available to companies building for learning. As such, they are a good fit. The grant application is very clear on what it requires. It requires us to partner with schools, and test our solution in schools. That is good for us, irrespective of whether we do it as part of the grant or not.

It requires a lot of writing. It is more skewed towards research in areas that are not yet proven. The grants are very competitive and its easy to be rejected for something as simple as an administrative mistake.

Several current grantees have been very helpful – meeting with us, showing us what needs to be done, sharing their applications. It is unusual to find that kind of help and information for other funding applications. We will apply for grants and see where it leads us.

Foundation Grants

Grants from non-profit foundations are also available at times to educational companies. They are also confusing. There are grants from many different sources, with very different deadlines, but, there is no compilation of them. It is not easy to find a grant that works for you. Perhaps that is a business someone else will solve.

Some like the AT&T Aspire or Breteau Foundation grant are in exchange of equity. Others, such as from Gates Foundation, are not. The equity vs. grant ratio is often set based on a very early stage company, with no revenue.


We could partner with companies that are in the same space – educational content providers, or, educational service providers. The major concern there is that we will end up customizing the content too much for that particular provider, and not for schools. The second concern is that in many of these cases, the partner wants to own the IP, in return for providing funds to build it – which is only fair.

Its a more contract type situation than building a product company. It is definitely worth pursuing. These contracts are usually awarded to personal or professional contacts.


Many people suggest using a kickstarter project to help fund the next stage of development. Running a kickstarter campaign, I hear, is a full-time job for 6 months. Would that time be better spent building the educational product instead? We are not particularly connected, or social. So, I wonder how much traction we would have.

Perhaps it would be worth doing a kickstarter to fund grants of our applications to non-profits. We gave $25,000 worth of software to – which we could ill afford to. Next year, we may need to try a kickstarter to fund asks from non-profits.


This is, as always, the remaining option when all else is exhausted. The more confused I get with funding options, the more I just want to sit down and code, build and create. I can build the solution with partners – skilled individuals – who are willing and able to help. If the sales happen, we can grow. If not, we die. No life-support. No confusion.

What to do?

I am sure I have plenty of wrong impressions about each of the options, but, nevertheless, I am recording the initial impressions, and will later record what I learn, and what ends up working for us.

If anyone knows more about any of these funding options, please do leave a comment or more information. I want to learn.

One thought on “The Confusion of Raising Funds

  1. Two things that I found during my recent research…
    1. Angel vs Seed funding
    There is a difference between Angel Funding and Seed Stage funding – though I have seen most documents confuse it too. Angel funding comes before the Seed funding. Angel funding is usually before there is a product or any proven traction. So, Angel funding is usually 100K-250K. Seed funding is after there is a prototype available, but, the team is still iterating on the product. The funding is typically 250K -2 million.

    2. Incubator vs. Accelerator
    A recent ed-tech document distinguishes them. Incubator is usually run by a non-profit effort. They provide services for cash. Incubators don’t require the company to be on site. They don’t offer funding. Participants are further along in the process.
    Accelerators typically offer 10K-25K in funding plus mentorship in exchange for equity. Participants are often in very early stages of product development. Company is required to be on-site. I still don’t know what either of these do, other than perhaps provide prestige?

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