New fundraising rounds aren't just exciting for startups. They also make a statement to competitors, current investors, customers and the general public about a startup's value and its prospects for the future.

This is especially true during the Series A round. For most startups, the Series A round is their first significant round of outside funding. Whereas earlier stages of the startup might rely on smaller sums of seed funding from friends, family, crowdfunding and angel investors, the Series A round is the first time that most startups raise substantial amounts of money to fuel meaningful growth.

During the Series A round, companies typically trade a 10–30% stake in the company in exchange for preferred stock, so the risk is higher for this particular round of funding. Which investors join, which investors notably don't join and the amount raised all speak as to where the company stands and, more importantly, where investors see it going.

If you're a founder of a startup that's in its early stages, you're probably wondering when to raise Series A funding. Choosing the most advantageous moment to present your pitch deck can be as important as having impressive performance metrics and projections.

There are a few signs that the timing is right for your startup to raise Series A funding.

You have strong traction

The most important factor in when to raise Series A funding is traction. Strong month-on-month (MoM) growth is 12–20% or higher – the sought-after hockey-stick growth projection that gets investors excited.

Start connecting with investors when your MoM growth trend is thriving and you can offer solid reasons why this is likely to continue or even increase. If your growth is steadily climbing at 5–10% MoM and you anticipate it taking an upwards turn soon, you might want to wait until then to raise your Series A funding.

You have an active investor network

In anticipation of your Series A investment, it's a good idea to build and maintain relationships with investors as far in advance as possible before you plan to pitch to them. It's significantly harder to successfully commit an investor with a cold pitch. Talk to a large number of venture capitalists (VCs), in the knowledge that you won't pitch to all of them.

You have significant growth

VCs looking for Series A investment opportunities want to support high-growth companies, so make sure that your growth metrics are in the right range to appeal to them. Perhaps you're tracking 50% MoM growth, but your revenue is lower than what investors are looking for.

If you're not sure what level of growth will make investors take notice, ask other founders in your industry or investors in your network who might know. This is another reason to build active relationships with investors before you even pitch to them. They're usually happy to give insights on what they do and the reasoning behind how they do it – this will help you to secure your Series A investment.

You have demonstrated product-market fit

There's no set formula for measuring product-market fit, let alone for proving it. It's loosely defined as proof that what your company is doing – what goods or services you provide – is successfully filling an existing gap in the market. Earlier in your startup journey (such as when you're raising seed money), you have to prove that the market opportunity exists and that you and your team have the right ideas and skillset to fill it. But when you're raising Series A funding, you need to demonstrate more than potential – you need to show that you're actually hitting the mark. Make sure that you're highly confident in the story that you're telling to prove product-market fit before pitching for your Series A investment.

Your revenue is growing

Customer metrics such as traffic, retention and engagement are essential measures of company health and a key factor in when to raise Series A funding, but you need revenue growth for VCs to invest. When revenue growth is there, customer metrics will further validate what's working and why. Investors looking for Series A investment opportunities want to feel confident that you're going to make their money grow.

You understand your growth strategy

When you pitched to investors for your seed round of funding, you might have communicated that you would explore a variety of channels for business growth. During the Series A round, investors aren't looking to finance further experimentation. Instead, they want to hear your plan for driving substantial business growth. Once you are clear and specific about what you can do to accomplish this, then you'll be ready to have the conversation that Series A investors want to have.

How to save money when incorporating a business

While some incorporation fees are unavoidable, it's possible to lower your business's costs by handling as much as possible in-house and seeking professional help when necessary. Here are a few key strategies for saving money:

• DIY incorporation: If your business structure is straightforward and you're comfortable with paperwork, filing the incorporation documents yourself can save you hundreds or even thousands of dollars in legal fees. Online resources and guides are available to help you through the process.

• Compare registered agent services: Registered agent fees vary between providers. Compare prices and services from different companies to find the best deal for your needs.

• Consider forming an LLC: Limited liability companies (LLCs) are often simpler and less expensive to form than corporations, making them a cost-effective option for small businesses.

• Choose the right location: Some locations have lower filing fees and franchise taxes than others. Research different places to see which ones have the most favourable business environment for your industry and budget. Delaware is a popular choice in the US for its business-friendly laws and low fees, for example.

• Take advantage of online legal services: Online legal services offer affordable packages that can guide you through the incorporation process and provide templates for necessary documents. Some might even have discounts and promotions for new customers. This can be less expensive than hiring an attorney.

• Negotiate professional fees: If you need to hire an attorney or accountant, don't hesitate to negotiate their fees. Some professionals might offer discounts for startups or small businesses.

• Plan for ongoing costs: While saving on initial incorporation costs is important, make sure to factor in ongoing expenses such as annual report fees, franchise taxes and registered agent fees.