Before Santi Jaramillo was an executive coach, he was an entrepreneur that started, or was a key player in several companies now worth almost $100M. Drawing on years of doing the work himself, he now helps founders navigate the complexities of growing their businesses. He's also the co-author of "Agile Engagement" and was recognized as Indiana's Latino Businessman of the Year in 2016, among other accolades.

In this episode, we talk through the dark side of fundraising and how to cope with rejection. Santi challenges glorified narratives of startup culture, getting real about the mental and emotional struggles that founders have to cope with. From the exhausting process of securing capital to the unexpected challenges that come with success, he offers a 360-degree view of the fundraising process.

Listen to the full episode with Santi here:

Here's what we’ll cover in more detail below:

• The Emotional Toll of Fundraising Rejection
• Reframing Rejection as a Learning Opportunity
• The Burnout Factor in Fundraising
• The Paradox of Successful Fundraising
• Operational Disruption During Fundraising

Emotional Toll of Fundraising Rejection

Investor rejection is a super personal and challenging experience for founders.

It's hard. It really sucks. You put your blood, sweat, and tears into this thing. It's your baby, and then they're rejecting your baby. You're like, how dare you?

Rejection hits hard no matter if it’s your ex or an investor. Santi's experience of pitching to around 50 investors per round, only to secure 5-10, paints a clear picture of the brutal nature of fundraising. Hearing ‘no’ more than you hear ‘yes’ is par for the course when raising money. So founders need to focus on building the muscle to handle frequent rejection while maintaining enthusiasm for every pitch. It's a balancing act between being open to feedback and protecting your core vision - a challenge that becomes easier with experience, but never truly painless.

Reframing Rejection as a Learning Opportunity

When faced with constant rejection, some founders look to unconventional coping strategies.

Get an investor gratitude journal. After every investor call, write what you learned and what you're grateful for from that investor, really seeking a rejection with an honest reason as a gift because you just found out something about your business.

This is a practical way to fine-tune your pitch and business model. Every "no" becomes a free consulting session if you look at it right. It's not easy, and it might feel a bit forced at first, but over time this mindset can transform the fundraising process from a series of rejections into a vehicle for continuous improvement.

The Burnout Factor in Fundraising

The relentless pursuit of capital takes a toll on even the most resilient entrepreneurs.

The way I can describe burnout is it would take less and less input of stimuli to trigger my nervous system and be in a state of fight or flight. I found it harder and harder to slow down and take a break.

Burnout in fundraising is like a slow-motion car crash you can see coming but can't avoid. It is not sustainable for your whole system to be on high alert 24/7. And by the time you notice it, you're already deep in the weeds. The stress messes with your head and leads to poor decisions that impact your whole business. Founders need to get to know themselves so they can catch the signs early and do something about it.

The Paradox of Successful Fundraising

Securing funding is a huge accomplishment for startups, but sorry to break it to you, it’s not going to make all of your problems go away..

It was such a stressful process to do the fundraise, many times a 6-9 month process. You'd get to the end as a CEO, as the lead fundraiser, and you'd be exhausted. You realize that you didn't summit the mountain, you just arrived at base camp and purchased the equipment you needed. Now you're exhausted, and now you've got to go spend the money and actually deliver the growth, which is sort of more real and harder than the fundraise bid.

Closing the round is just the beginning, the real work starts after the money hits your account. It's a jarring shift from selling a future to building it. I agree with Santi in that the pressure to deliver on those projections is more intense than the fundraising process itself. You've got the resources you wanted, but with them comes a whole new level of expectations and scrutiny. It's a classic 'be careful what you wish for' scenario that catches a lot of founders off guard.

Operational Disruption During Fundraising

The fundraising process demands a dramatic shift in a founder's focus and daily responsibilities.

I remember the first two fundraisers, I just thought, 'Oh, I'll just keep doing what I'm doing, CEO and operations wise, and I'll just stay late and get less sleep.' Then after the first two, I was like, no. Before I started fundraising, I laid out everything that I was doing and I cut half of it and delegated it to my team.

Think you can just tack fundraising onto your already full plate? Yeah, good luck with that. It's not about working longer hours, you need to completely reshuffle your priorities. Fundraising becomes your full-time job, which means something's gotta give. For Santi, it meant cutting his workload in half and trusting his team to pick up the slack. It's a tough pill to swallow for many founders that want their hands on every detail, but it's a critical step in growing both as a leader and as a company.

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