Startup Fundraising Tips For Summer
I know… Everyone is about to enjoy summer and you’re not sure about what to do with investors during this period.
The venture capital scene tends to see lower activity in August as investors take their summer breaks. So, what should you do as an entrepreneur fundraising during this downtime?
Yes, rounds do close in July and August, but that’s usually because the entrepreneur had all the pieces in place by the end of June, leaving just the final steps to wrap up. You are probably working with tight timelines and need to make something happen on the funding front quickly. So, what’s the move?
If you’re aiming to close a round this year, the best thing you can do right now is to start refining your materials, perfecting your pitch, sharpening your story, and most importantly: expanding your network. Discover how to unlock investor connections for your startup.
Fundraising Hack: Ask 1 founder for 1 intro
Many founders share their strategy with us, and most of the time is something like: “I’ll email everyone I know with my pitch deck + blurb and say – Please forward to anyone who might be interested.” or even better, getting into a call with a founder and plainly saying “I need warm intros…“
This approach is a perfect recipe for disaster. Why?
It is actually asking a lot of your contacts/friends, even though they are your friends… Imagine asking this to someone you just started talking with on a videocall for 10 minutes.
They’ll have to go through their contacts, consider if someone might be interested, make a decision, and then forward the email.
Odds are, they’ll freeze up and end up not sharing your message with anyone. Even if they do, it will not be an intro with someone you know it’s a great match.
The best way to approach warm intros is to ask each person for an intro you’ve previously researched.
Why is this a good path?
It’s simpler for the other person: That person only has to decide wether to make the intro or not, and the person already has your reasoning behind the intro.
The new lead feels special: They aren’t receiving a generic mass email that’s easy to overlook. They’re being presented with a unique opportunity from a person in their network
And most importantly, in our own experience, many people outside of our network decided to open more than just one door, leading to unexpected funding opportunities.
Now, let’s talk about Seasonality…
There’s a short window from September to mid-November when deals get done. Investors return from their holidays with two things on their mind:
If they haven’t hit their investment targets for the year, they’re on the hunt to close those gaps, and
They’re not interested in working over Thanksgiving and Christmas!
Keeping in mind seasonality in fundraising will help you prioritize your efforts
So, if you want to take advantage of this window, instead of unsuccessfully cold emailing investors, use this time wisely to lay all the groundwork for your raise. As we said before, get your company’s story and your pitch nailed down, and put yourself out there by connecting with founders. If you’re able to convince founders to make intros over a 15-min video call, you are at better odds of landing investment for your startup.
Try to pile intros up and get meetings lined up for September/October.
Remember, revisit your pitch and see how you can make it even more compelling. Turn your story into killer sentences and slides. Clear, captivating, but not giving away too much.
Use this time to connect with founders to get intros.
Sure, summer might be a tougher season to close a round, but it’s an ideal time to set the stage for a successful fall fundraising effort.
Start planting those seeds now, so you can harvest the rewards of your hard work in the fall.