Startup Fundraising in Texas

texas state flag

Startup fundraising in Texas is hard.

Definitely harder than raising in New York or Silicon Valley.

BUT, I do expect it to get a whole lot easier and exciting really fast with the attention Texas is getting, in particular Austin (Tesla, Elon Musk, Oracle, Joe Rogan).

So until it gets easier…what can you do to raise capital in Texas?

My name is Saurav Agarwal, I’m the co-founder and CEO of SIERA.AI and have raised several million dollars of capital from inside and outside Texas.

At SIERA.AI we help warehouses and factories streamline productivity by preventing industrial vehicle accidents and digitizing compliance. We’ve been based in Austin, TX since Day ONE and love being part of the startup explosion in Austin, TX.

3-Step Guide to Startup Fundraising in Texas

  1. Get involved with local Angel groups. Texas has an extremely active angel community and a lot of capital ready to be invested. Don’t be obsessed with raising VC money. SIERA.AI raised all its initial capital from Texas angel investors barring a few angels. (Less than 25% of our seed capital came from outside Texas).
  2. Move to Austin, TX. It’s the next silicon valley 🙂
  3. Don’t be afraid to fundraise outside Texas. SIERA.AI’s lead institutional investor is from NYC.

Watch this video from TK Kader on fundraising. He has many more…but this video is a solid explainer on the various stages of company growth and how different investors fit in that journey.

Here are some resources that could help you as you navigate startup fundraising in Texas.

Angel Groups for Startup Fundraising in Texas

Some angel groups are very structured and have a refined process for fundraising. Others are more of a gateway to present to a big network after which it’s up to you to deal with individual angels.

BUT…all the angel investor groups in Texas are warm, friendly and very generous.

Central Texas Angel Network or CTAN (extremely structured) but we never ended up raising from CTAN as a group.

Houston Angel Network or HAN (invested in SIERA.AI) Somewhat structured but you have to do follow-ups individually with investors.

Texas HALO Fund (invested in SIERA.AI). Very structured given that they operate as a micro VC.

North Texas Angel Network or NTAN (invested in SIERA.AI). Similar to HAN, structured to the point of getting through investor presentations, but after the presentation, you’re really on your own working to round up investors individually.

Tyler Texas Angel Network (invested in SIERA.AI). Similar to NTAN in their approach.

Accelerators To Help Kickstart Fundraising in Texas

SIERA.AI is not part of any accelerator.

The only one I’d really recommend is Capital Factory in Austin, TX because of their vast network and resources.

In full disclosure, my biggest concern with giving up equity to an accelerator without getting an investment is the risk that it doesn’t work out for your company and now you’ve lost time and equity without getting capital in return. But then again, if you just have an idea and a founding team, maybe it’s just the right thing since you have nothing to lose anyway :)…

List of my favorite VCs in Texas

None of the below are investors in SIERA.AI but I have had significant interactions to be able to say that I truly enjoyed getting to know them.

Eric Engineer, S3 Ventures

Richard Deulofeut, Trust Ventures

Chris Shonk and Brad Bentz, ATX Venture Partners

Ryan Kline, Mark Cuban Companies

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