I recently presented a webinar to the All Raise community as part of our National Partnership announcement and M12’s Action Plan Series of content to support startup founders during this difficult economic time. My goal with this content was to equip founders with guidance for navigating digital engagement with investors, offer questions to anticipate for COVID-era fundraising, and provide best practices for delivering a great remote pitch. I want to arm founders with as many tools in their arsenal as possible to succeed while pitching, and avoid some of the common communication pitfalls I have seen since the onset of the COVID era and digital-only pitch meetings.
While the full extent of the economic impact of COVID-19 is still unclear and these are uniquely turbulent and unprecedented times we’re living in, many VCs are still in business, and the best companies are still getting funded.
Here are some tips for how to approach fundraising strategically:
Assess a VC’s investing status:
Are your VC targets actively making investments? Are they frozen on most deployment?
Admittedly, this status is hard to ascertain. I’d recommend targeting 25–30 firms that would be a good fit for your startup and tap into your network — ask friends in VC or founder connections who are in a respective VC’s portfolio whether these funders are actively making investments. VC firm blogs, newsletters, and press releases offer certain signals and indications of deployment status.
Investors who are active on Twitter and other social media may be commenting on sectors they are exploring for investment, or announcing the new investments they are making. Keep in mind that there are certain industry-specific funds that are hyper-active right now, including those targeting healthcare IT and remote monitoring, online education and learning, and collaboration or remote work SaaS to name a few examples.
If you are a startup that is operating in one of those sectors, or has a predominant customer base in one of those sectors, it will work in your favor to strongly signal that you are operating in a domain experiencing tailwinds.
Articulate your objective:
This tip is grounded in respect for both your time and the investor’s time. What is your intention for investor outreach? Are you looking for a “get to know you” call, or a bona fide intro that may lead to investment?
If you’re fundraising, specificity is key, and being able to address how much money you are hoping to raise, and in what timeframe, is helpful and orienting to investors. It’s a very confusing and uncertain time; demonstrating your clarity and vision as a leader inspires confidence in you as a founder.
If you can keep calm and objective — or even excel — during stressful times like these, it’s a great indicator that your leadership ability is world class.
Commit to digital etiquette:
In the absence of face-to-face, in-person connection, digital communication carries more weight.
Lean on your network whenever possible to facilitate warm introductions and be intentional about cold outreach — even if it’s as simple as customizing your LinkedIn connection request.
Check the tone, spelling, and grammar of your message, and turn on your video whenever possible to make getting to know you a little bit easier.
Anticipate COVID questions:
The global pandemic has impacted all of our lives and can’t be avoided in your company narrative. If you’ve gotten to the pitch phase of your fundraising effort, ensure that you have answers to the following example COVID-related strategy and planning questions in your back pocket:
- How is COVID impacting your sales pipeline?
- How has COVID impacted your cash balance and cash management strategy?
- How will your company emerge from the pandemic stronger than before?
- What are you learning and what is your company getting better at during this time?
Manage your bandwidth:
You’ve made it to the pitch! You have your ideal investor’s attention! And then…you get a notification indicating poor network connectivity, and your connection starts breaking up.
Sometimes, this is an unavoidable reality, but there are a few things that you can do to mitigate how much time it takes to get back up and running. In advance of your pitch, ask family members to stop streaming shows or video games. Consider dialing your cell phone into the call as well as your laptop as backup. And send your deck in advance of the call in case investors need to track the presentation locally.
Establish a personal connection:
Imagine investing millions of dollars in a company run by…a person you’ve never met! This is becoming the reality for many VCs as many stay-at-home orders remain in place.
Take advantage of every video call as a chance to demonstrate your values and personality. Share a personal anecdote or the origin story of the company before diving into your pitch. Watch the investor intently when they speak so they know you are listening and tune into their verbal and non-verbal cues, both of which require additional effort in a virtual setting.
Rehearse your delivery:
While it may be tempting with a screen right in front of you, try to avoid reading a script. There will likely be fewer social cues to field, so anticipate interjections and proactively ask for questions. There may be fewer assuring nods to motivate the presentation than you might receive in-person. Keep that in mind, and manage your own mindset.
Plan in advance during your presentation to pause, take a breath, and give kudos to yourself for making it this far — as my founder friends have explained to me, it’s less likely for you to derive energy from your audience via remote pitching.
Finally, whenever possible, connect the pitch deck to the presentation. With so many distractions on our screens, it is not the best time for minimal slides. Keep investors focused on the content.
Confidence and preparation are undeniable differentiators, now more than ever.
We are living through uncertain times, and are collectively experiencing and witnessing complex and challenging economic, environmental, political, global health, and social problems more viscerally than ever before. Part of what keeps me looking forward to the future, is the opportunity to speak to and work closely with founders who actively envision a better future, and then go out and create it.
I hope you find these tips helpful as you embark on your COVID-era fundraise. Confidence and preparation are undeniable differentiators, now more than ever. Prepare to the best of your ability, cultivate a confident mindset and get out there onto the field. I am rooting for you and can’t wait to see what you build; we at M12 are all rooting for you.
