Fundraising at the Earliest Stage: What Founders Should Prepare For

The Spaces explores earliest-stage fundraising in Web3 with guest Rana Darmos, Founder & CEO of Moonhill Capital. It outlines a maturing market where experimental capital has receded and investors evaluate startups more like Web2—demanding real problems, users, and traction. Rana stresses founder qualities that correlate with success: clear vision, openness to expert advice, prioritization, and professional execution. He notes VC risk appetite is at multi‑year lows for first-time founders, amid underperformance of early-stage portfolios and attractive risk-adjusted alternatives like Bitcoin. For pre-seed, Moonhill largely relies on strong referrals and looks for a compelling “why,” large addressable markets, quality materials, and organic adoption. Founders should avoid token-first fundraising unless the token is a core utility, build high-level but convincing go-to-market plans (often partner-led), and work with advisors. On sequencing, build in public and develop MVPs while engaging community and selectively networking with investors in parallel. Looking ahead, practical verticals include payments, stablecoins, and trading, with growing importance of agentic/AI-enabled products that leverage blockchain invisibly to users.

Solana APAC Bootcamp Live Session: Fundraising at the Earliest Stage

Session context and participants

• Host: Moderator of the Solana APAC Bootcamp live session (name not specified in the recording).
• Guest: Rana Darmos — founder and CEO of Moon Hill Capital (the fund name is referenced with minor transcription variance in the recording). Originally from Slovakia, currently a resident of Paraguay, dialing in from Vietnam. In crypto since 2016; began by backing projects informally via an investor community in Czechia and Slovakia, then formalized into a fund structure in 2020 (Fund I largely own capital, later funds include external LPs). Early focus on infrastructure, later expanded to verticals like VPN, AI, and consumer apps with real user traction.
• Agenda: Four areas — (1) Founders and market reality; (2) What investors evaluate; (3) Services/support and how to prioritize; (4) Practical fundraising strategy.

Market reality and common misconceptions for first rounds

• The market has matured and resembles post–dot-com conditions: The prior “experimental” phase (2016–2021/22) where nearly any credible team could raise is largely over. There’s now a surplus of projects and investors have time to evaluate rigorously.
• Web3 is evaluated like Web2: Most early projects lack revenue/users/traction. Investors apply traditional startup rigor (market size, early traction, go-to-market, team execution) rather than backing token-driven experiments.
• Blockchain must be necessary to the solution: Projects should leverage blockchain as indispensable infrastructure for a problem that demands it (example cited: Polymarket). Token-first without a real, blockchain-required use case is a non-starter.
• Regulation and market structure have advanced: Unlike the 2017 ICO era (one-pagers raising easily), today’s environment demands real use cases, compliance awareness, and product-market fit.

Patterns among founders who succeed at fundraising

• Coachable, vision-led leaders: Strong conviction plus willingness to listen to people with relevant experience (operators, domain experts, advisors). Quote highlight: “If you’re the smartest person in the room, you’re in the wrong room.”
• Surround yourself with complementary experts: Skilled founders bring advisors/co-founders who fill gaps (product, GTM, legal, token design, etc.). This shows in how they speak and in the quality of their materials.
• Prioritization and timing: Balance openness to feedback with discipline. Not every good idea is a “now” priority; great founders can say “correct idea, wrong timing until we hit milestones X/Y/Z.”
• Iteration through dialogue: Close advisory cycles broaden founders’ perspectives. Regular, focused reviews (e.g., weekly) reveal blind spots and upgrade thinking across product, GTM, and fundraising readiness.

How investor risk appetite has changed (implications for first-time founders)

• ROI pressure and LP expectations: Many early-stage bets from the last cycle are underwater; funds are prioritizing capital preservation and clearer risk/reward.
• Primary vs. secondary comparison: For some investors, simply buying Bitcoin (with growing institutional adoption and liquidity) and aiming for a 2–3x over a 5-year horizon can be more attractive, liquid, and lower risk than illiquid pre-seed equity/tokens at high valuations.
• Consolidation trend: Expect more mergers/acquisitions; “bigger buying smaller” is cleaning the market and favoring scalable, revenue-linked models.
• Higher bar for first-time founders: Double difficulty due to founder inexperience plus market conditions. To overcome: show an MVP/proof of concept, demonstrable problem-solution fit, and early user validation (even a small, active community). Avoid both extremes of ignoring advice and chasing every suggestion. Having engaged advisors who work closely with the team is especially critical now. Risk appetite for first-timers is at a multi-year low.

What investors look for in the first five minutes (pre-seed, little/no revenue)

• Reality of funnel triage: Moon Hill Capital is currently selective at pre-seed; warm, high-trust referrals from respected funds/partners are often required to warrant deep review.
• The “Why” test: The immediate question is “Why should this succeed?” Founders must articulate a compelling, rational “why now/why us/why this model.”
• Real, sizable problem and TAM: Ensure the problem isn’t founder-fabricated. Show that the total addressable market is meaningfully large and the pain is widespread.
• Professionalism signals: Sloppy decks and disorganized materials are red flags that statistically correlate with execution risk. While not determinative, investors minimize red flags to tilt odds in their favor.
• Traction trumps form when present: If a team quietly has hundreds of active users and a path to sustainability without marketing, a weak deck can be forgiven—but that’s the exception. Many teams benefit from advisory to sharpen narrative, materials, and GTM.
• Founders’ proximity bias: Investors can often assess a deck in minutes; founders immersed for months may miss misalignments. External critique is valuable.

Services and support: how to prioritize relative to fundraising

• Tokenomics (only if truly necessary):
  • Do not add a token solely to raise capital. If the token is not core to the product’s mechanics (e.g., like ETH as gas), it creates distraction and operational overhead (listings, MM, price management) that pulls focus from customers and PMF.
  • Historical caution: “Launchpad token” patterns showed poor long-term performance when the token acted more as loyalty points than essential utility.
  • Default stance: Prove the business and customer value first; consider a token only if the solution fundamentally requires it.
• Campaign planning and go-to-market:
  • Align GTM with distribution reality. Example: If your solution serves exchanges (B2B2C), don’t spend scarce dollars marketing directly to end-users; co-market with the exchange, aim for organic usage, and gather unbiased user feedback.
  • Early-stage GTM can be high-level; investors need to see credible channels and partner leverage. Details deepen as you approach execution.
• Advisory as an accelerant (beyond tokenomics/GTM):
  • Seek guidance across team structure, legal, compliance, and investor readiness. Treat modern AI tools as a supplemental advisor but validate with domain experts.
  • Maintain a “project inbox” mental model: Know every component (product, GTM, ops, runway, metrics, timeline). When receiving pushback, always ask “why,” what would they change, and gauge whether the counterpart is an expert in that area.
  • You’ll never be 100% prepared; the goal is to be prepared enough to credibly convince investors of future success.

Fundraising strategy: sequencing community, traction, advisory, and investors

• Do key activities in parallel:
  • Build in public: Engage early with users/customers (distinct from “community” hype). Validate the problem and solution; share progress to attract feedback and believers.
  • Avoid investor outreach at the “idea only” stage. Spend a couple of weeks building an MVP/proof of concept, test with a handful of real users, and articulate early learnings.
• Be in the right rooms:
  • If you can attend a major event (e.g., Consensus in Hong Kong) after initial MVP/user validation, go. Proximity to the right people matters. An informed investor chat can surface blind spots (e.g., GTM gaps) and unlock targeted intros to operators or advisors.
• Differentiate roles: Clearly distinguish “community” (supporters/followers), “users” (active product users), and “customers” (paying or contracted stakeholders). Build for users/customers’ real problems; let community amplify, not define, product direction.

2024 verticals and narrative outlook

• Recently funded areas: Stablecoins, payments, and trading have attracted capital (fewer rounds, larger checks). These often solve real, immediate problems, show traction, and have clear acquisition optionality.
• What to build for this cycle and beyond:
  • Real problems, hidden blockchain: Expect more products where blockchain is an invisible infrastructure layer; users care that it works, not that it’s “crypto.” Polymarket is a referenced exemplar.
  • Agentic future (medium-long term): Design with “human-in-mind, agent-oriented” principles—solutions that can interface with AI agents (agent-to-agent communication), and anticipate IoT and human–machine symbiosis advances. Timing is uncertain; keep optionality without overcommitting this year’s roadmap.

Practical takeaways and founder checklist (pre-pitch)

• Problem and necessity:
  • Clear problem statement with evidence it’s widespread and painful.
  • Explicit rationale for blockchain’s necessity (if applicable); avoid token unless essential.
• Evidence and story:
  • MVP/proof of concept, real user feedback (even a small cohort), early engagement metrics.
  • Crisp “why now/why us” and a rational path to PMF.
• Market and GTM:
  • Credible TAM/SAM, buyer persona, and channel strategy aligned to distribution partners.
  • High-level GTM now; commit to details as you near execution.
• Materials and process:
  • Clean, professional deck and data room; eliminate obvious red flags.
  • Advisory bench identified (domain, GTM, legal). Know your “project inbox.”
• Fundraising ops:
  • Target investor mapping; prioritize warm referrals. Be ready to answer “Why will this succeed?” in the first five minutes.

Memorable highlights

• “If you’re the smartest person in the room, you’re in the wrong room.”
• “You can’t be 100% prepared—be prepared enough to convincingly show your path to success.”
• “Build for real problems; don’t create problems to fit a token.”

Closing notes

• The host emphasized Solana APAC Bootcamp’s support for developers who want to found companies on Solana and encouraged openness to advice in Web3’s expert-rich, collaborative culture.
• Rana invited founders to reach out (same handle on X/Twitter and Telegram) and expressed interest in learning about projects being built.