Simon Burns is the co-founder of Wealthcoin, a bitcoin investment services startup that recently graduated from California incubator Boost VC. Here, he shares insights from his ongoing journey to raise a seed round.

One of the most talked-about trends in the bitcoin ecosystem is that raising capital as an early-stage bitcoin startup is harder now than it was a year ago.

Sure, we’re in the midst of bitcoin investment increasing dramatically year over year, but funding is down quarter over quarter, and there are other reasons VC dollars are hesitant to move into bitcoin startups.

In 2012, growth rates for the sector were still unclear, so it was considerably easier to “sell the dream, not the data”. Now that data has come out around consumer wallet use and merchant adoption, some investors are shying away. It’s been in this context that our team has set out to explore raising a seed round.

I’ve been meeting with early-stage bitcoin founders in San Francisco and New York who’ve accomplished what I’m setting out to do. Founders ranged from enterprise bitcoin data-as-a-service providers with a few clients to consumer wallet companies with hundreds of thousands.

Despite their differences, however, they offered much of the same advice. Here are the five things I’ve learned so far:

1. Bitcoin VCs first, general VCs never

The most often repeated advice I’ve received from industry founders is this: Don’t talk to VCs who don’t get bitcoin, ever.

This has come from enterprise- and consumer-focused founders alike, because almost every founder I spoke to had a story that goes something like this: They’re asked to meet with a big partner at a name-brand VC fund. Next, the founder realizes they aren’t an investment target, they’re just a guinea pig there to teach the investment team about bitcoin.

This is obviously less than ideal, and can become a major waste of time.

While there’s potential that a multibillion-dollar fund opens up to bitcoin just to invest in your startup, don’t count on it. Focus. The list of bitcoin VCs is public on Crunchbase, Mattermark and other sources.

My favorite list compiles all of these resources and is published by CoinDesk here.

2. It will never be this easy, it will never be this hard

The founders I reached out to for advice span the spectrum, many have been in bitcoin for years and several others are new to the space.

While the level of experience running a bitcoin startup varies, what doesn’t is the belief in a “golden era” that has past.

I can’t list off how many times I’ve heard “but it was so much easier before X, you’ll have a hard time now”. Replace X with “Coinbase“, “Mt Gox” or “bitcoin’s price was $1,000“. There is always a moment in every space to look at when raising was easier, and there was always a time when it was harder.

Few mention how difficult it was to raise at bitcoin’s lows whether its price low or around the 2013 hard fork. Don’t let it distract you.

Melanie Shapiro, CEO of Case Wallet, advised:

“Have a simple message, we had ‘We’re the best hardware bitcoin wallet’. Find yours.”

3. East Coast loves private blockchains, West Coast loves consumer

This is a very wide generalization I admit, and I apologize to the outliers I’ve met who buck my assessment.

Through our first set of meetings with bitcoin VCs, it has become very clear that a divergence in venture investing focus is present along geographic lines. California-based VCs are thrilled by 21 Inc, the globalization of exchanges and the coming consumer revolution with hundreds of millions of wallets.

By comparison, East Coast VCs tend to be focused on Wall Street disintermediation through private blockchains and other enterprise uses of bitcoin as a distributed ledger.

Both are often taken to extremes and neither opinion is right.

When on the East Coast, starting the conversation by covering bitcoin’s use as an asset or currency is an appropriate move to judge the climate and make the foundational case on bitcoin. Do this before moving into a dialogue about how you’re building your business around the technology.

4. Be public early, consistently and never stop pitching

There are several benefits to being public about your product.

What has become immediately clear during the fundraising process is that investors are much easier to pitch when the meetings open with “I’ve seen you on Twitter, people love the product and I can really see how this could scale”.

Meetings typically start with 15 minutes of leveling the playing field and getting the VC on the same page in terms of how you see the world, your product’s wedge in the ecosystem and how you plan to grow.

Saving that time and talking about more intricate details is better for the VC and better for you. The only way you can get to that point is by getting the product in people’s hands and being public about what you’re building.

Matt Schlicht, CEO of bitcoin social network Zapchain, said:

“Get out there and never stop pitching. Don’t ever pitch small, pitch the biggest vision of what you want to build.”

5. Seek mentors

For fellow early-stage founders currently thinking about raising, take my advice, don’t jump in and talk to VCs.

While I’m certainly no expert on raising a seed round, I’ve been thrilled to be able to work with some of the best founders in the bitcoin space to iterate on my pitch, get the right introductions and approach meetings as prepared as possible.

Take the time to find three to five bitcoin company founders that you admire and send them thoughtful emails highlighting how much you appreciate what they’ve contributed to the ecosystem and how much you love their product.

Build your network through those founders.

Practicing your pitch will be invaluable and the introductions to their investors will be worth 10 times what another introduction will be worth.

Silhouette in tunnel image via Shutterstock