Rob Coneybeer / November, 2017
What is best practice in terms of pitching for a series B round?
Rob Coneybeer, Managing Director at Shasta Ventures explains the key elements for a successful pitch when raising a series B funding.
What is the best practice in terms of pitching for a series B round?
When we think about a series B round, we think of it as either the 2nd or 3rd round of financing. So sometimes you have the seed round and then you have a series A round and up till that point the company might have raised anywhere from 5 million dollars to 10 million dollars between the seed and the series A. We would expect that is part of that time frame the company has customers, it has channel partners and it has a clear view among its customers of why they chose that product or service ahead of other products or services.
So, what we’re looking for and there are no hard-and-fast rules about this, but when we invest at the series B stage, even though we’re primarily series A investors, we would expect at the series B stage to see significant customer traction and proof points that the money going in at the series B stage is really about accelerating the growth of the company and it’s not about proving out is there a product market fit for the product or service.
When people are thinking about series B, the most important thing to remember that’s going to be in their mind is: what do the traction look like, do customers like the product and what is the position in the market relative to competitors and how big is the market going to be. And you expect there to be a much clearer view of just how big or how large the market can be and how it’s defined. That said, knowing that that’s what the audience wants to understand, you should always begin a pitch with what the product is, what the service is and give a demo of the product or service so that the investor can then take that and tie that to what the customers are saying. Because if I don’t know what the product and service are, there’s no way I could actually go and evaluate why these customers like and whether other customers are up to like it as well.
So the number one thing in a pitch is to start very early on with the product to service, a demo of those things, then going to customer traction, then talk about the market and one of the last slides are actually talking about the team.