Fundraising in the AI Gold Rush: Practical Strategies for Startups to Secure Capital in a Cautious Market

-David Martin

In 2024, AI funding reached $100 billion. Startups encounter substantial difficulties when obtaining funding despite receiving this large amount of money. The main challenge for founders to obtain investment comes from their improper business presentation approach instead of their technological worth.

Tony Kim, an AI infrastructure-focused Venture Capitalist has reviewed over hundreds of pitch decks this year and identifies this misalignment as his main observation.

Tony explains: "In my discussions with startups, I often find they are unaware of their competitive landscape until I highlight it. I therefore adopt a holistic approach, assessing all facets of their business, including traction, go-to-market strategy, and product roadmap."

Tony’s observations demonstrate essential market trends which require investors to possess sophisticated knowledge. The AI investment market showed a 62% increase to $110 billion in 2024, while startup funding dropped by 12% and deal numbers decreased consecutively for nine quarters.

The market remains concentrated, with AI capturing 31% of global venture funding, despite representing a significantly smaller proportion of total deals. The venture capital market displays its concentration through two major examples: OpenAI recently secured $40 billion at a $300 billion valuation led by Softbank, while xAI obtained $6 billion in funding.

The existing market patterns require founders to understand them when they seek investment opportunities in this competitive environment.

Investor Perspective on Founder Preparation

Tony's background provides insight into what sophisticated investors seek, as he straddles both technical and go-to-market perspectives. He shares his approach to learning: "A big part of what I do to educate myself and continually expand my knowledge is reading biographies of different founders, how they started their businesses," he says.

"I spend a lot of time going into blogs that discuss specific concepts, like Kubernetes or developer tools, just to learn about it. On a similar angle, I take boot camp classes alongside engineers."

Tony combines his technical expertise with a team-oriented perspective: "I think one big part is empathy. I look at the team a lot. The reason is that in most cases, the team matters a lot more in terms of how the company will do moving forward," Tony explains. This approach helps him evaluate beyond just technical metrics.

His technical expertise enables him to assess AI startups through metrics that extend beyond basic numbers. His analytical process reflects this depth: "I'm fairly analytical, so I dive very deep into different materials of the company," he reveals. "I try to piece things together, looking at customer contracts, and I go into the technology stack as well."

Building Financial Models that Convince Investors

The majority of AI founders make revenue projections yet fail to deliver the financial unit economics models that investors require. Tony, along with other sophisticated investors, seeks financial elements which most startups fail to provide.

Describing how he helps founders present both technical capabilities and financial sophistication to investors, Tony says: "The technical foundation informs the financial analysis. I look for crisp drivers and assumptions, and whether the plan reflects how the product actually gets adopted."

Accessing Decision-Makers Beyond Traditional Networking

Sophisticated financial modeling means little without access to the right investors. Tony emphasizes value-first access and has developed systematic approaches that solve the access challenge many founders face.

"Lead with value," Tony says. "Share useful market context, competitive insights, or genuine customer signals before you ask for time. It changes the conversation."

For founders, this translates to sharing market insights, competitive intelligence, or industry analysis that demonstrates expertise before presenting their pitch.

Successful access also requires understanding organizational dynamics. "Make internal advocacy easy," he adds. "Provide a one-pager, integration diagram, and a short customer proof point so sponsors can explain your value internally."

Tony believes that systematic relationship building, rather than opportunistic networking, creates lasting access. Personal relationships form the foundation of his approach: "Personally, I set up a lot of one-on-ones to build relationships professionally and personally, which become crucial for projects." This persistence model applies directly to founder outreach.

Crystal Liu, an established AI investor with extensive experience in venture capital and strategic technology investments, has observed his systematic approach to founder engagement: "I would say he's a pretty curious person in general," she reveals.

"Whenever he sees a new company, he digs very deep into that category. So he's that type of person who's instinctively curious about everything that he sees on the market. Tony's also really good at sourcing. So it's not only because he's very technical and knows his space very well, but I'd say he's pretty relentless in terms of following up with founders.

"There have been times where founders were not getting back to him, but he would find other angles to get connected with them, and then he goes to a lot of events to make sure he's understanding the market dynamics."

Crystal's observations as an experienced AI investment professional reveal the persistence and multi-angle approach that founders must mirror when pursuing investors. And it's the same relentless follow-up and creative connection strategies that Tony uses to reach founders should be applied by founders seeking investor access.

Market Intelligence that Demonstrates Strategic Thinking

Founders need to show both financial knowledge and market expertise to succeed in their search for investors. Founders who develop proprietary market intelligence capabilities stand apart from their competitors who depend on basic industry reports.

Tony's approach to market tracking illustrates what sophisticated analysis looks like. His methodology encompasses comprehensive market analysis: "I've created databases to track private and public market activities across mergers and acquisitions (M&A) and venture capital, combining data sources from public databases," he says.

"That showcases the overall landscape and keeps the team apprised." This level of market intelligence demonstrates that founders can anticipate market shifts and identify opportunities others miss.

Difference Between "We'll Circle Back" and Actual Support

The majority of fundraising operations contain polite rejection responses that pretend to show interest in future contact. New founders develop their ability to identify which investors perform follow-through and which ones remain empty promises.

Tony's approach extends beyond individual company assistance to systematic ecosystem strengthening. "I try to be helpful in any way possible for early companies," he says. This philosophy contributes to the broader health of the U.S. venture ecosystem by ensuring promising founders receive guidance even when immediate investment opportunities don't align, creating a more robust pipeline of innovation that benefits the entire technology sector.

Tony highlights his philosophy: "My thesis is I'm not just a blank-check investor; my investments are oriented around going beyond, willing to really help founders at large."

His vision for improving the fundraising landscape centers on systematic ecosystem enhancement: "I think what I hope is that the industry has more of its investors willing to help startups and founders. That would make the ecosystem better... I've seen challenges from founders: talking to investors often feels like time wasted, no value. So I bring empathy."

This approach reflects Tony's understanding that individual investor behavior aggregates to determine the overall strength and competitiveness of the U.S. innovation economy, positioning his connector role as a strategic contribution to maintaining America's leadership in global technology markets.

Founders need to check whether potential investors support companies they have not funded as a way to assess their partnership potential. The response between a genuine partner and a transactional participant becomes clear through this question. The objective is to establish an ecosystem rather than focus solely on deals.

Building an Ecosystem, Not Just Deals

Tony's investment philosophy centers on systematic ecosystem building rather than transactional deal-making. His approach emphasizes large-scale opportunity creation: "I really like to play in the ecosystem, bridging startups and creating opportunities."

Tony experienced firsthand the complex challenges founders face when building and scaling businesses. This entrepreneurial background informs his comprehensive approach to founder support, creating empathy that purely financial investors often lack.

Additionally, the ecosystem-building methodology strengthens America's competitive position in global technology markets by fostering interconnected networks that accelerate innovation, facilitate knowledge transfer, and create collaborative frameworks that benefit the entire U.S. startup landscape.

Tony's ecosystem building extends beyond individual investments to active community engagement. This ecosystem engagement reflects his standing within New York's most selective technology forums, where his expertise has earned invitations to exclusive judging and mentoring positions.

Tony was selected to judge at NYC Tech Week, one of the nation's most prestigious technology events known for inviting only established industry leaders. His appointment as a judge for 43North—a highly competitive accelerator program awarding $5 million grants to exceptional startups—reflects his hands-on involvement in identifying promising founders early and connecting them with relevant opportunities within his network.

These judging appointments represent national recognition of Tony's expertise, as such programs maintain exceptionally selective criteria for evaluators, typically reserving positions for venture professionals who have demonstrated significant impact across multiple investment cycles.

There is no doubt his evaluation experience spans a remarkable breadth: "The companies we looked at really vary across the board. I've looked at companies as small as 2 to 10 people, all the way to multi-billion-dollar companies."

For founders, this ecosystem approach means seeking investors who actively contribute to strengthening the U.S. venture landscape and view individual founder success as fundamentally interconnected with America's broader innovation competitiveness.

Tony's methodology demonstrates how strategic ecosystem building, achieved through selective forum participation, cross-network introductions, and systematic founder development, creates multiplicative effects that enhance the resilience of startup ecosystems.

Tony's connector philosophy functions at multiple levels within the ecosystem simultaneously. His guidance and introductions provide individual benefits to founders yet his broader efforts enhance the fundamental base of American venture capital infrastructure.

Tony helps the U.S. innovation ecosystem gain competitive advantages in global technology markets through his methodical startup connections to investors and knowledge transfer between sectors and his commitment to maintaining high standards in selective forums.

The Opportunity Hiding in Plain Sight

Most AI founders focus on explaining their technology's capabilities while missing what concerns investors: market positioning and integration challenges.

Tony identified this pattern through selective judging and mentorship across New York’s tech ecosystem and other invite-only investor panels, including Wallet Max’s Planet Positive Pitch Competition, where he evaluates companies and advises founders. These evaluator roles underscore industry-wide recognition of Tony's analytical framework and market judgment, positioning him among the select group of venture professionals trusted to assess high-stakes investment opportunities that shape the next-gen innovation landscape.

Given his expertise, Tony identifies the real challenge. The core issue isn't the quality of technology. Instead, it's anticipating investor concerns around scalability and deployment friction. He says: "For instance, if raising for AI semiconductors, demonstrate compatibility with existing stacks to minimize deployment friction. In hypothetical scenarios, overlooking export controls, supply-chain/packaging limits or datacenter compliance can dilute returns—always map out go-to-market paths that align with broader ecosystem trends."

Founders who want success present their solutions to investors by demonstrating how their products integrate with established systems, rather than requiring entirely new approaches. According to Tony,  this integration-first positioning always finds success: "They should leverage networks through mentorship and events to refine pitches. I've seen founders secure intros by showcasing adaptability, turning cautious investors into advocates."

This means spending as much time on integration narratives as on technical capabilities. The opportunity lies in addressing deployment concerns before investors raise them.

The Path Forward for AI Founders

Founders can seize genuine market opportunities by understanding that investors fund solutions to their problems, rather than being impressed by technical capabilities. The method Tony employs demonstrates that successful ventures stem from addressing investor concerns directly.

This methodology has earned recognition from other investment professionals who have worked closely with Tony. Nabil Amir, a venture professional focused on frontier technology investments with deep expertise in evaluating complex technical innovations, who has collaborated with Tony on deep tech investments, explains what makes Tony's approach effective: "Tony is disciplined, very generous, and forward-thinking. He has been doing rigorous analytical work at the current job, stress-testing assumptions and running sensitivity analyses.”

Nabil adds: ‘Tony has an open-ended approach, always sharing his models and frameworks. He's also keen to make introductions without expecting anything in return, blending generosity, rigor, and vision—a rare combination. The systematic approach that Nabil, as a frontier tech investment specialist, was able to leverage thanks to Tony translates into practical guidance for founders.

This proven framework focuses on three critical areas:

• Show investors how your solution integrates without breaking existing systems
• Prove your team can navigate regulatory challenges before they become roadblocks
• Demonstrate market timing through concrete validation rather than theoretical projections.

For founders navigating today's selective funding environment, Tony's final advice centers on adaptability: "Open-mindedness is a considerable aspect. Never be stubborn, always open to trying something new. When you see how the industry changes, you can be at the forefront."

The companies that receive AI funding in this market understand investors back deals with solutions that address their sleepless nights regarding integration risks and regulatory uncertainty and market timing challenges. According to Tony the correct execution of these principles provides founders with their largest opportunity to date.