How to raise your next venture round

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If you want advice, ask for money. If you want money, ask for advice

I had a call this morning with a young entrepreneur. Like many founders he has a seed stage startup and is not sure about the best path to get to series A. 

As we talked about where his business was at and how he’s thinking of approaching investors, I shared some advice that I’d like to share here. That advice is based largely on the above pithy, but true quote.

There are a lot of seed funded companies out there. Not all will get to the next level of funding. The best way to maximize your chances of getting more venture capital is to know exactly what the next stage of capital is looking for.  Read More

A look at the Constant Contact acquisition


Earlier this week Endurance International announced an agreement to acquire Constant Contact, one of the largest SMB SaaS players. At $1B, this exit is probably the largest in the SMB space.  So, I thought it would be worth looking at to see what other SMB SaaS companies can learn from it.

Background: (thanks to my colleague Shubham for pulling together some research here)

Constant Contact (NASDAQ: CTCT): Read More

Fintech and Scale

blog-FinTechThe Money2020 show is happening this week in Las Vegas. I was there last year and it was huge. It’s even bigger this year with over 10,000 attendees. In much the same way as this event has huge scale, fintech companies must also achieve massive scale in order to be successful. It’s a go big or go home market.

The most obvious examples of this are the payments companies. Payments is a great business in the sense that once you’re in place, you just take a small cut on everything that passes over your rails. BUT, it requires huge scale in order to make money. Square is evidence of this. It had a loss of over $50M last quarter alone, despite having revenue of over $330M. 

If we stay on payments for a moment, Stripe is the favourite payments engine of every developer I know. They have raised $ 290M to date and are worth $5B. I have not seen their financials, but in 3 years they have gone from a valuation of $18M on their seed round to $ 4.9B on their series D. Clearly the market expects Stripe to be the next Paypal – a massive market leader in payments.

Direct to consumer startups also require huge capital. The consumer market is massive, but hard to reach at scale unless you have a viral product. So, if you’re looking to build a B2C market leader then you will need lots of capital to build your brand. Toronto’s Wealthsimple knows this and came out of the gate swinging with a $30M Series A round. This is massive for any market, but probably the largest Series A for an internet company in Canada. Read More

Fundraising is a team sport

One of my companies is doing the tour of Sand Hill Road this week, meeting with the best of the best firms. I woke up this morning to read an email they had shared with their entire company highlighting who they’d met with, what had been discussed, questions, issues, possibilities, etc, etc. I love this!

So often the fundraising process is the big elephant in the room. Everyone knows it’s happening and that it’s super important. But they have no idea what’s happening, who you’re meeting with, etc. And of course, we fear what we don’t know. So, when we know something important is going on but don’t know how it’s going, then we fill that void with speculation.

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