3 Steps to Oversubscribe Your Funding Round 💰📈
A recap of last week's Tech Thursday helps put into perspective what oversubscription takes.
This past week’s Tech Thursday session, “How to Oversubscribe Your Funding Round”, co-hosted by InterGen, learned from three Calgary-based founders who did exactly that, and heard what they found to be successful, from cold emails that created FOMO to evolving based on investor feedback.
The panel featured:
Jenn Hunter (Director of Operations and Co-Founder at PayShepherd)
Omar Sabbagh (Founder at Bidaya AI)
Prateek Sodhi (Co-Founder and CEO at Finofo)
Moderated by: Khalid Hansraj (Program Director at InterGen)
Missed last week? Check out our recap video here and be sure to follow us on Instagram for updates on everything Tech Thursday.
TL;DR
Relationships are key in any funding phase: The relationships that culminate before even considering funding rounds can often be the biggest contributors.
Fundraising needs to be dynamic: Being able to adjust on the fly is crucial to having a successful funding round.
Make the “yes” as easy as possible: Answer questions, streamline the information, and create a low barrier of investor entry.
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3 Keys That Unlocked Oversubscribed Funding Rounds:
1. Relationship-Building Starts Way Before You Ask For Money
Success in fundraising was rooted in trust built long before the need for capital. Building genuine relationships strengthens credibility, and when it comes time to raise, provides more than just a polished pitch.
Why this is important: Trust takes time, and building relationships, similar to building companies, is done over months and years, not days. By building relationships before ever asking for funding, connections will be built with people who have seen real progress and the team and vision. As Prateek mentioned, a cold email that reached Andreessen Horowitz led to several VC introductions, and as a result, saw multiple successful pre-seed rounds.
Key Takeaway: The best cold email you can send to an investor is your investor update.
2. Fundraising Is a Dynamic Process; Constantly Update your Pitch
Fundraising isn’t easy, and the process becomes even more difficult if you lock yourself into a pitch and wait for yeses. Adjusting story, strategy, and even the target investor profiles will likely need to change throughout the process.
Why this is important: It is vital to be dynamic in the fundraising process, especially in a world as fast moving as tech. Oftentimes, what founders believe will land is not what ends up being most impactful, and having this flexibility allows for shifting messaging on the fly. Additionally, investor expectations shift, so being able to adjust to reflect investor expectations, while also showcasing an inherent ability to learn and shift where needed, make for a more attractive investment opportunity.
Key Takeaway: Constantly use feedback from investors to update your pitch (and your deck).
3. Lower The Barrier of Entry to Investors Wherever Possible
A resounding theme of the session was the importance of making it easy on investors when fundraising; through streamlined communication, anticipating and alleviating concerns, or making content so investors can self-serve answers, lowering the reasons to be told ‘no’ is key.
Why this is important: Simply put, investors are busy. Having to navigate existing friction points and competing with other tasks in any investor day-to-day is an easy way to lose ground when fundraising. Through different tactics to alleviate concerns in a timely fashion, provide all necessary information (specifically utilizing FAQs to scale investor relations through transparent communication as Jenn mentioned), and showcasing a strong first impression by having this content prepared, the consistent theme in oversubscribing funding rounds is lowering the barrier of entry to the “yes”.
Key Takeaway: The easier you make it for investors to say “yes”, the more likely you are to oversubscribe your funding round.
Hot Take:
Oversubscription Is Earned, Not Pitched
The panel’s agreement in the importance of relationships and dynamism in any funding round suggests that oversubscriptions are fluid, and static pitches will be less likely to become oversubscribed.
Why is it earned? A great pitch is vital; but being able to connect with people, create and nurture relationships, and adjust to changing market conditions are the pathways to oversubscribing your funding round.
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Parting Thoughts:
“We met James Lochrie from Thin Air Labs on the day we decided to leave our jobs. He led our round years later.” - Jenn Hunter
Don’t Miss the Last Two Tech Thursday’s of the Month!
June 19 (Tonight!): ‘The Future of Cloud Security’, co-hosted by Wiz
Including:
Moderator: Kim Menier, Account Executive at Wiz
Gavin Miller, Director of Application Security at Clio
Joseph Johansson, Sr. Solutions Engineer at Wiz
Stefan Doan, Chief Information Officer at Neo Financial
June 26: ‘Tips and Tricks for Successful SR&ED Claim Applications’, co-hosted by Boast.AI and RBCx
Including:
Aly Khan Musani – CFO & COO at Symend
Dawson Drolet – Director of Business Development at Boast.AI
Rehan Ahmad – Director of Banking at RBCx