Raising Money in Recession

It’s no surprise that it’s been tough to start and run a new business in the downturn, but Julie Brown of Inner Rewards shared her blow-by-blow experiences raising money over the last year with Collective-E. The full post is worth a read, but here are some excerpts. At this point in the piece, she has raised $765,000 from an angel who proves, throughout the tale, to be just that.

July 2008—I set out to hire a team and get started with an aggressive goal of building and launching a beta site by the end of the year. Because my investor wanted to build a company ready to be fully backed, and given an aggressive timeline to build a full blown site with content and videos, we ended up with a very high monthly burn rate (monthly expenses). I immediately set out to raise more money.

September 15th, 2008—Lehman collapses and the market is in turmoil, every single investor runs for the hills. I have now built up a full staff with 7 employees and 40 contractors and need to raise cash quickly or we will run out of money before I can even launch.…