ITR #005: The Power of Process in Early-Stage Fundraising

Welcome back to Into the Ring!

This will be the final edition this year, so I want to take a moment to reiterate my thanks to you for being a part of the growing ITR community. Your feedback means a lot, so thank you for your comments and responses to date.

(Know a founder who could use some real insight on their fundraising journey? Send them a link to subscribe right here - no better Christmas gift! 🎁)

ICYMI 📣: In the last newsletter, I wrote about the art of investment, and how to send the right signals to top VCs who rely on gut feel when evaluating startups. Do check that out if you missed it. 

I want to close out the year with a look at the process behind running a tight kickoff period, which can be the difference between a slow, frustrating fundraise and one that builds (and maintains) momentum. 🚀

Preparing for Kickoff 🏈

The kickoff period is the heartbeat of any fundraising process: a concentrated one to two week window where founders aim to pack in their first (and most critical) 20–40 investor meetings. It’s an intense, but if correctly prepared for, exhilarating time, creating a fast-moving, high-energy fundraise that drives momentum and sparks urgency for investors.

Start your kickoff preparations at least a few weeks in advance of when you want to begin.

• Build your investor list: Identify 100–150 potential investors and group them based on priority.

• Establish Wave 1: Narrow down your top 20–40 targets, the investors you’re most excited to pitch to, and focus your energy here.

• Warm up intros: Reach out to mutual connections who can make key introductions to Wave 1 investors.

Waves: A Clear Channel to Investors 🌊

Your investor list is your fundraising map, and thinking of outreach in waves helps to channel your energies on the most promising conversations, while ensuring that you can quickly layer in additional meetings if you need more traction.

Your Wave 1 investors will remain your core focus throughout the couple of weeks, but having those Wave 2 and 3 investors in reserve gives you something to draw on if momentum isn’t building as quickly as you’d like.

The Pre-Work Differential ⭐️

Putting in the work before you kickoff sets you apart from your competitors - and there are plenty of them out there. 

Stand out by showing investors that you are focused, detailed and motivated, with careful preparation.

1. Ask for Intros

   • Reach out to mutual connections who can warm up vital connections with investors.

   • Share your planned kickoff dates to create a sense of urgency and encourage timely scheduling.

2. Protect Your Time

   • Politely decline requests for ‘early’ meetings. Keep everything focused on the kickoff window.

   • Ensure that meetings are booked with decision-makers (partners, not associates).

   • Block off your calendar to handle back-to-back meetings without burning out or getting distracted. 

3. Craft Your Pitch:

   • Polish your deck so that it passes the ‘Uber Test’— is it clear, concise, and scannable on a mobile device for investors on the move?

Your objective here is to move investors toward the next step.

Running a Purposeful Investor Meeting 💪

First impressions are all-powerful during the kickoff phase, and you need to show you can confidently run an investor meeting that is structured and purposeful. 

Strike the balance between getting investors excited and reassuring them of your capability to deliver. 

• Be clear: Use your polished pitch deck to deliver a concise overview of your business.

• Engage confidently with Q&As: Be prepared and unafraid to dive into questions, showcasing both your preparation and adaptability.

• Highlight your edge: Emphasize why your company is a $1B+ opportunity and why your team is uniquely positioned to deliver.

• Go for the Ask: Be upfront about what your fundraising ask is.

Keep in mind the key objective: to move investors toward the next step with a clear call to action, like accessing your data room, or scheduling a follow-up meeting. 

Maintaining Momentum 📈

Momentum is everything in early-stage fundraising. 

After some successful initial meetings, prepare for follow up meetings where investors dig deeper into your business and evaluate fit, in a period typically lasting 2–6 weeks, from deep dives into product, market and financials, to meetings to introduce co-founders or key team members.

And don’t forget to nurture emerging relationships with your investors - remember that fundraising isn’t just about capital. It’s also about building long-term relationships with people who believe in you. 

Keep track of where each investor stands in the process and nurture relationships accordingly.

Moving Toward a Term Sheet ✍️

Securing a term sheet is the ultimate goal of the fundraising process, but it takes work to get there. Most investors will need a minimum of two to four meetings before they’re ready to commit. 

Your sponsor partner will have to present your deal to their firm’s partners in an Investment Committee that’s typically held weekly. Help them advocate for you with thorough preparation and inspiring pitch materials, to build internal buzz for your startup.

If you’ve put the work in, you’ll hopefully be fielding multiple term sheets - this is an awesome position to be in!

Signal to other investors when you’re close to receiving or have received a term sheet, and aim for 2–4 additional term sheets to create competition and secure the best terms possible.

The Long-Term View 🔭

Process is powerful when fundraising, and running a tight kickoff period sets you up for long term success. With the right planning, you can build partnerships with investors that will last for years, not to mention secure the capital you need to accelerate your growth.

What strategies have worked for you when meeting with investors? Reply to this email—I’d love to hear!

👉 Need a tailor-made plan for successful outreach? I can help.

Every other week, I’ll be reaching out to my network to get their take on important questions on every aspect of fundraising. Got a question you’d like me to ask? Let me know. This week, it’s a matter of trust.

Q: How do you choose which investors to approach, and what criteria matter most to you?

Thanks for stepping Into the Ring 🙏

Thank you for reading today, and for your support. If there’s anything that resonated with you, simply hit reply and let me know.

🎄🎆 Wishing you and your loved ones a happy holiday season. Merry Christmas and Happy New Year!

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