“Always be fundraising”: how to prepare for your next round of investment

18 Sept

In the third in a series of posts on what your scale-up should be focusing on after a successful fundraise, we’re looking forward — to your next round of investment.

"Always be fundraising”. That’s the motto of Tessa Clarke, CEO and Co-founder of Olio, the app that allows people to share food so it doesn’t go to waste.

So as well as aligning your team and winning new customers, post-raise you’ll also want to be looking to your next round of funding.

Here’s three things you should be doing:

1. Targeting the right investors

As with any funding round, it’s vital to find the right champions for your business. So it pays to do your research on potential investors.

What gets them excited?

What have they invested in before?

Do their interests chime with your company’s specialism?

Can they get behind your vision?

Developing a complete understanding of the person you’re trying to persuade is the first step to winning them over. For an inspiring example of the power of personal knowledge, see our post on how a group of outsiders persuaded the board of M&S.

In the words of Tessa Clark: “Cultivating investor relationships long before going to market allows you to continuously test and iterate on your messaging and get feedback in real time.”

2. Keeping your current investors warm

The best way to ensure your next round of funding? A great relationship with your existing investors.

If investors have a choice between a portfolio company that’s kept in touch and one that’s not, the founder who’s been most communicative will have the edge. Plus, if new investors see old investors providing follow-on funding, it sends a positive message.

So treat your existing investors like you treat your customers — as there to be nurtured. A great way to do that is to create a monthly investor update that builds their trust and keeps you front of their mind. See our post with 10 tips for creating a monthly investor newsletter.

3. Preparing to pitch!

As with your last raise, you’ll want to put together a pitch that captures the value you deliver and the potential for growth.

Your story will have moved on since your last pitch, so do avoid reusing content from earlier decks. Instead, focus on what’s changed: for example, how you’ve grown, what’s new in the market, and what you’ve achieved since your last raise.

When it comes to style, be sure to keep your pitch deck punchy and powerful, like this, our favourite example. Oh, and as with your last round of pitching, remember, one deck is not enough.

Investor pitch coming up? Check out our guide to handling performance nerves on the day.

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