When Mallorie Brodie describes the process of preparing for a pitch, I can tell Iâm talking to an expert. Bridgit Solutions, the company she and her co-founder, Lauren Lake, started has raised over $9 million in capital to date, even though she initially didnât expect to receive any angel investment when she first started the company. The difference, she tells me, is that the market research she and her co-founder had done was spot-on, and as soon as one financier showed faith in them, others were quick to follow suit.
PwC started the Raise podcast: to share the stories of founders and their hard-fought journeys to raising capital.
These are the sorts of experiences, insights, and success stories that only seasoned entrepreneurs can speak to; and theyâre important lessons for budding business leaders.
Thatâs why we at PwC started the Raise podcast: to share the stories of founders and their hard-fought journeys to raising capital. As the podcast host, I use each episode to engage in one-on-one conversations with Canadian tech company founders who have recently secured funding, to hear firsthand how they networked and negotiated for the capital they needed.
In the first six episodes, Iâve had the opportunity to hear from Marc Castel, founder of Fiix Software; Taylor Bond, head of growth at SalesRight; Braden Ream, CEO and co-founder of Voiceflow; Mallorie Brodie, CEO and co-founder of Bridgit Solutions; Hussein Fazal, CEO and co-founder of SnapTravel; and Lindsay Goodchild, CEO and co-founder of Nudge Rewards. And weâre not done. Weâve had so many more candid conversations on how to navigate the high-pressure world of venture capital that we canât wait to share.
On that note, Iâd like to reflect on five common insights from the first episodes. If youâre looking to attract investment for your next stage of development, these may steer your path:
1. Ask yourself: Is VC right for your business?
We donât talk about it enough, but VC investment can be complicated, and isnât necessarily the right path for all growth-stage businesses. Before you even start figuring out the right steps for attracting VC funding, you first have to determine if it even makes sense for your company and where you want to take it. This is a consideration that each of the entrepreneurs I spoke with thought hard on before they moved ahead with their investment strategy.
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Itâs important to remember that with funding comes investors, real stakeholders with a legitimate say in your business, questioning your decisions and helping to determine your direction. So if youâre bringing on a VC investor, remember that theyâre there for the long haul and can potentially be more important than some of your senior hires. In Fazalâs experience, thatâs meant attracting investors that are aligned with SnapTravelâs vision and mission, not just the prospective numbers. If you opt for the VC model, having stakeholders that offer both funding and a strong belief in your business model can make for a much more fruitful relationship.
2. Keep your investors close
In his episode, Bond [SalesRight’s head of growth] shared an interesting insight: seed-stage companies can benefit from engaging local investors in unique ways. Venture capitalists are well-versed analysts who make it their business to know whatâs happening in a given industry, and if you can walk down the street – or in Taylorâs case, down the hall – and pay them a visit, so much the better.
While local proximity may be important in a companyâs early stages, that will change as it matures and raises Series A and B rounds, because, by that point, itâs likely to have an international profile. So as your company evolves, bring on experts and investors that are located in the markets where youâre actively looking to build your business and then draw on their expertise.
3. Know your narrative and your numbers
Pitches can happen when you least expect it, and before you know it, you have three minutes – or 30 seconds – to explain your business. This is something that all founders know from experience, and theyâll tell you how crucial it is to always be prepared to articulate your companyâs story.
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And if the founder isnât the best person to do that, then they should seriously consider appointing a CEO who can truly sell the vision. Beyond just the narrative, make sure you have the numbers to back it up. Keep your data room up to date and have metrics ready to share. Certain investors care less about your milestones than they do about your momentum; show them a sound strategy and path to scale, and they might show you the money.
4. âNo” is not the end of the story
So youâve pinpointed a VC investor who would be an ideal fit for your companyâs mission and values, youâve made your pitch – and they turn you down. It can be disheartening, but while that chapter may be over, that doesnât mean the book is closed.
Having a network is critical for scaling companies. Build relationships with investors that interest you, then nurture those connections.
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For one thing, there will be other pitches, sometimes just a matter of minutes or hours later, and itâs crucial to keep your eye on the ball. Voiceflow CEO, Ream, talked to me about his agile approach to presenting, and how his team was able to pivot strategies between pitches in order to pre-empt investorsâ questions and objections. Voiceflow is achieving success now, but Braden said that some of his initial meetings went horribly, and he just needed to treat the experience the same way he treated his startup, as an iterative, constantly-evolving process.
Additionally, having a network is critical for scaling companies. Build relationships with investors that interest you, then nurture those connections. Just because someone declined to invest once, doesnât mean they wonât be interested once youâve grown.
In his episode, Castel [Fiix Software] told me that heâs in regular communication with roughly 100 venture capitalists. That may not be a realistic goal for everyone, Castelâs career as an entrepreneur is long and well-established, but itâs good insight into whatâs attainable as you progress through your own journey.
5. The old saying holds true – timing is everything
Foresight is key, and the further you can project into the future, the better. Why are you seeking funding, and what will you use it for? If youâve obtained capital, how long will it sustain you? For Brodie, when she and her co-founder were building Bridgit, they had a clear understanding of what milestones they would hit with their funding. To her, being fully prepared with a solid view of the future was critical to getting their funding.
Meanwhile, when it comes to planning the next round of financing, Castel has found it best to raise funds two cycles before heâll need the money; that way heâs always prepared with a built-in contingency and isnât forced into difficult positions when it comes to funding.
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One of my favourite things about the Canadian innovation ecosystem is the fact that thereâs such a wealth of support and knowledge-sharing within the community. Even those who are competing with each other still want the best outcomes for all companies, because a strong sector elevates every one of us.
The Raise podcast provides a platform for founders to impart their stories, ideas and inspirations to their fellow startups and scale-ups, contributing to the growth of our industry.
Thereâs still so much more to learn and we have an exciting roster of speakers lined up to help us do just thatâI hope you listen in.
If you are interested in being a guest in a future episode, or know someone who may be a good fit, please reach out at rich.adam@pwc.com or @richgadam.
This article was originally published on LinkedIn.