Why Invest in Vertical SaaS
Vertical SaaS is a venture sector in the tech space. It narrows the scope of the startup to a single application. Vertical SaaS has many advantages as follows: It’s easier to position in the market and message to the customer. By narrowing the scope, the startup can dive deeper into...
Raising an Inside Round
Most startup fundraisers seek capital from outside investors who are new to the round. This brings new investors into the cap table. There are rounds in which the existing investors fund the startup. This is often done for bridge rounds. Instead of raising the next major round, the startup raises...
Using Rule 701 To Issue Equity to Employees
In a startup, it’s helpful to compensate employees with company stock. Most companies use stock options. Rule 701 gives the startup the ability to issue equity to its employees. This works even if they are not accredited investors. The limit is $10M or 15% of the outstanding shares in a...
Create a Sense of Urgency
In running a fundraiser, it’s important to build a sense of urgency into the campaign. Here are some key steps to create that sense of urgency: Break your fundraising into smaller rounds or tranches. Demonstrate this by showing the fundraising plan that has more funding to come, but at a...
The Role of AI and Data in Fundraising
Startup fundraising begins with family and friends and then expands to the founders’ network. In that part of the fundraising, founders will engage those they know well. Half the reason these investors join the round is to help the founder. After this group is exhausted, the founder draws the circle...
Bring Three Stats for Your Startup Fundraising
In raising funding, it’s important to showcase the key numbers behind your business. Here are three statistics for your startup fundraise: Revenue traction — show what traction you have so far including the dollar amount and the growth rate. Customers need to know where you are on the revenue-generating path...
Bring Three Stats for Your LP Fundraise
Raising funds from Limited Partners requires a track record, an investment thesis, and a competitive advantage. It’s important to show you have a track record of successfully deploying capital. Investors want to know what you will be investing in, and is that space growing. Finally, they will look for your...
Raising Funding in Downtimes
Fundraising goes through the same cycles as the stock market, When the stock market is going up it’s easier to raise funding. When it’s going down it’s harder. Raising funding in down times requires more creativity. Here are some ideas on how to raise funding in a down market: Use...
Show How Your Valuation Is Already Achieved
Valuation is a key factor in a startup’s fundraising. Most startups show an aspirational valuation and then spend the pitch trying to convince investors it’s appropriate. Most use their forecasted revenues to justify their valuation. Forecasts hold little value to the investor and often leave them unconvinced about the proposed...
The Four Phases of a Pitch
The successful startup pitch goes through four phases. Start by capturing their imagination. This could be a bold statement, such as we can solve cancer within ten years. This sets the context for the problem to be solved. Next, show your solution and how it will achieve the goal just...
