4 Reasons Why You Should Raise Capital Before You Even Have a Deal

When it comes to raising capital, many entrepreneurs and investors believe they need the deal locked down before they start talking to potential investors. This approach can work, but it often leaves you scrambling under tight deadlines, battling to align investor expectations with deal specifics, and missing out on potential opportunities.

What if you flipped the script? What if you raised the capital before you had a deal?

After years of raising capital and teaching others to do the same, I’ve found that preparing the funds upfront isn’t just a strategy—it’s a competitive advantage. Here are four reasons why raising capital before you even have a deal on the table can transform your approach and set you apart as a capital-raising powerhouse.

1. It Gives You Leverage at the Negotiation Table

Having the money ready to go turns you into a cash buyer, which is a massive advantage in any negotiation. Sellers are more likely to prioritize your offer because you’re ready to close without delays. This can also help you negotiate better terms, whether it’s a lower purchase price or more favorable deal structure.

What Happens Without Capital:

-You risk losing deals to more prepared buyers.

-Sellers may doubt your ability to close, even if the deal looks promising.

Pro Tip: Sellers value certainty. Raising capital ahead of time allows you to present yourself as a reliable closer who won’t need to scramble for funding at the last minute.

2. You Build Investor Confidence and Trust

Investors don’t just want to see a deal—they want to see that you’re in control. Raising capital before you need it shows them you’re proactive, well-prepared, and serious about your investment strategy. It also eliminates the pressure to push deals just to meet funding deadlines, which can come across as desperate.

What Investors Love About This Approach:

-They see you as a visionary with a clear plan.

-You can tailor deals to match their goals without rushing.

Action Step: Communicate your strategy for securing deals and how pre-raised capital will be deployed. Highlight your Unfair Advantage—the unique value you bring to the table that sets you apart from other opportunities.

3. You Stay in Control of the Process

When you’re raising capital during a deal, the process can feel chaotic. You’re juggling investor calls, deal due diligence, and the timeline to close—all at once. By raising funds beforehand, you can focus on finding the right deal without the added stress of securing capital under pressure.

The Advantage:

-You can take your time vetting deals that align with your investment thesis.

-You avoid the risk of over-promising and under-delivering.

Pro Tip: Use frameworks like my Million Dollar Conversations to pre-qualify investors, ensuring you’re aligned before any deal hits the table. Building relationships in advance sets the stage for smoother conversations down the road. Download my Unlimited Investor leads book below to access the Million Dollar Conversations playbook.

4. It Positions You as a Market Leader

When you consistently have capital ready to deploy, you become a magnet for top-tier deals. Brokers, sellers, and partners know you’re someone who can act quickly and decisively. This positions you as a market leader, not just another buyer in the crowd.

Why This Matters:

-You’ll get access to off-market opportunities others never see.

-Partners will want to work with you because they know you deliver.

Action Step: Share your success stories and track record to show why you’re the ideal partner. Investors want to see that you’ve been where they want to go, so leverage your past wins to inspire confidence.

The Takeaway

Raising capital before you have a deal isn’t just about being prepared—it’s about positioning yourself as a leader, building trust, and creating opportunities on your terms. It’s a strategy that gives you the freedom to act decisively, the confidence to approach investors, and the leverage to secure better deals.

The information contained herein is for general guidance on matters of interest only. This information contained herein is not intended to provide you with any advice on financial planning, investment, insurance, legal, accounting, tax or similar matters and should not be relied upon for such purposes. Marcin Drozdz, M1 Real Capital Inc are not financial, legal or tax advisers. You should assess whether you require such advisers and additional information and, where appropriate, seek independent professional advice. You understand this to be an expression of opinions and not professional advice. You are solely responsible for any actions you take with the content and hold Marcin Drozdz and M1 Real Capital Inc or any of it's affiliates harmless in any event or claim.