Welcome to a new series: The Nerd Invites.
Each edition, I invite a prominent investor or industry leader to share their unfiltered thoughts with Aussie founders.
For the first edition, I’m handing the mic to Harikesh Pushpapathan, General Partner at Stoic Venture Capital—a firm investing in founders at the frontier of research.
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The Fundraising Landscape Has Shifted
Raising capital in 2025 is very different from what it was a few years ago. When money was cheap, investors took bigger risks. Now, investors far more selective..
Implication #1 for Founders
As Australian VC funds are generally finding it harder to raise money from their investors (called LPs) it means VC funds are having to be more selective which creates a new reality:
Average companies? No funding.
Above-average companies? Might raise, but on tough terms.
Good companies? Fair terms, but no excess.
Great companies? Still good terms, but you need to truly stand out.
This shift means founders need to focus on building real businesses, not just pitching great stories.
Implication #2 for Founders
As funding is harder to get, it means that founders need to prepare for and execute a much more considered capital raise as speaking to the wrong investors will waste your valuable time and business growth.
Not all capital is created equal (just like avocados at the supermarket). Know your ideal investor profile. Below are the five broad investor buckets:
Generalist Funds - Typically, they have a higher risk tolerance, are tech agnostic, and offer less specific support.
Specialist Funds - Lower risk tolerance, more flexible terms, and deeper support.
Angels/Family Offices - Patient, mission-aligned.
Debt - Warwick covered that a few years ago here.
Larger vs. Smaller Funds - Larger funds have more capital to deploy, which makes them more aggressive in meeting their allocation targets. They often push founders to take on more capital and can be less collaborative (dilutive). Typically, they have a stronger brand and more follow-on support. Smaller funds are less aggressive, more collaborative, and have a weaker brand, with less follow-on support.
Why You Should Care? The difference between closing a round in 3 months versus 12 months? Its all about the time spent with the wrong investors. Either way, fundraising takes longer than you think.
Implication #3 for Founders
Every VC has written a monologue on LinkedIn about “storytelling. “Don’t tell me, show me.” Or some other generic nonsense. This assumes that the problem is painful A, your solution is uniquely differentiated B and all that is missing is nice narrative to give it the veneer of legitimacy. Don’t fall into this trap. Focus on having good answers to both A and B. Otherwise don’t bother w storytelling. Zebra A is sick of hearing Zebra Bs claim of being differentiated. “I’m white w black stripes, not black w white!“
My borrowed advice on Problem Framing - Make the problem “relatable.” I borrowed this from Sam Lessin, who I recently caught up with. He says, "What is your Seinfeld Problem?" When Jerry opens and closes his routine, why do we laugh?
A) It evokes the feeling of “hah, I've definitely had that problem.”
B) Problems are quick and easy to transmit.
Sure, I get that deep tech is solving some of the worlds most complex problems, but I still think the “personable” factor is essential when raising capital.
My Non-Consensus Take on Fundraising
Pitch investors on all the things that could go wrong with your business. Then, follow up with how you plan to mitigate those risks. When someone pitches me a startup and it feels too good to be true, my guard goes up instantly. I’m immediately working against you, trying to poke holes in your pitch.
On the other hand, if you start with all the reasons why this might not work, you’re inviting the investor to work with you, not against you, to solve for those risks.
A question I always ask founders: What’s been the gating factor to your invention or solution? Why hasn’t this been done before? Founders love to present industry or structural justifications, but they often miss the more crucial question: Why them? Why can’t anyone else do this?
Some Other Fundraising Tips
Don’t sell too much equity too early. Don’t accept harsh terms, board rights, or pricing too early—especially in the pre-seed stage.
When evaluating a potential investment partner, over-index on the “long-term relationship potential. Pick partners who wont be difficult to work with, rather than chasing the highest valuation.
An investor mailing list is a great idea. Aim for consistency. Find a cadence you can realistically maintain. And always ask them before adding them to the list!
General Partner @ Stoic VC ; an early stage venture fund helping advance human health and the physical world. To do this, we partner with 10 of the top Universities in Australia (Uniseed - Australia’s longest standing venture body). Prior to this, I spent several years at other VC’s, corporate advisory and helped grow a digital health startup. Currently building a community for those curious about the life-sciences/deep tech called DnM’s. When I’m not investing or attending to sporting injuries, I love to write - both in music and blogging. Drop me a line.
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Hi - I’m Warwick Donaldson—capital raising expert, and unapologetic advocate for Australian startups. Across my career, I’ve worked on 160+ equity raises totalling over $400m. I pride myself on helping early-stage founders secure funding, avoid costly mistakes, and build investor confidence.
If you’re a founder looking to raise capital, attract top-tier investors, and build a generational business—then hit me up for a chat.
Disclaimer: Excentricity Pty Ltd, trading as CapXcentric (ABN 42 679 978 959, AFS Representative No. 001311296) is a Corporate Authorised Representative of True Oak Investments Pty Ltd (ABN 81 002558 956, AFSL 238184). The information provided in this article is intended for companies and startups and is not directed towards investors. Any statements or representations are general information only and do not take into account your personal objectives, financial situation or needs. Readers are advised to have regard to their own circumstances and consider seeking specific advice from a professional adviser before making any business decisions. No representations are made as to the accuracy, completeness, or reliability of any information provided in this article. Readers use the information provided at their own risk.