Among the many challenges that face entrepreneurs is the potential for a failed funding round, when anticipated funding doesn't materialize. In this article in Entrepreneur, Chris Sloan offers advice on how start-ups can attract and keep the right investors. Mr. Sloan urges startups to perform rigorous due diligence on potential investors, noting he has seen VCs without money in their funds who show interest in leading a round simply because it might be a good PR move.
"Don't be afraid to ask if an investor actually has an active fund," Mr. Sloan said. "Often, VCs have capital deployed and don't have any money to invest at the moment. The ethical ones in those scenarios won't purport to lead a deal; they'll be transparent about it."
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