Our SaaS startup needs investment to take us up

Some companies seek an investment with just an idea. We already have multiple products in paying customers’ hands.

We need to market them better. That’s where the money will be spent.

We know nothing about pitching besides what we learned on the internet

If we were in Palo Alto or even London, we could meet other startups and VCs and get advice. But we’re in Newcastle.

So what did we do, and what did we find out?

1. We applied to about 10 VC funds via their website. Some, like Sequoia Capital, just require an email directly to a person you choose based on their profile and investment interests. Micheal Moritz’s profile enthralled me because it was short, to the point, and (therefore) engaging. I didn’t know then that Micheal is a professional writer, but it shows.
2. Most VCs require a form filled out on their website. It’s a bit time-consuming, especially where you might answer a question in detail only for the next page to require the detail. Then having to go back to re-write the previous one. But generally, this format is fine.
3. Some VCs mention what type of investment they are looking for and what they have already made. But they don’t indicate how to propose an investment opportunity. Most have given an office address without specifically saying to write to them.
4. General lessons learnt: a) Each application must be bespoke and tailored; try to find commonality in their investment portfolio and what you offer. b) Don’t give up easily or be thin-skinned about rejection. c) Respond even to rejection emails, thank them and ask for tips and advice. d) Try to find an angle; if you are a woman, find funds which look for female founders. e) Look at your business. Continue to improve that. The more sales you get, the better your chances of getting funding or not needing it.

We applied to 12 VC funds over two months ago. I wrote bespoke investment applications—no copying and pasting. Whenever I write, I always make it short, to the point, and engaging to read. Even though being a good read isn’t the purpose, I’d rather not send something that wasn’t enjoyable. That’s because I’m a writer in my spare time (and increasingly, it feels like my calling).

We have had three rejections, and the rejections gave little or no information on the reason. Is it our pitch, our numbers, our products, or our people?

This is the biggest disappointment. It isn’t the rejections—with our inexperience, that was almost expected—but the lack of feedback to improve. Although maybe it could have been expected because it’s not their job to educate us. So what do we do now?

What are we doing next?

1. We’re revising our pitch deck and adding more detail about how we intend to scale up. However, without feedback, I’m guessing on reasons for rejection.
2. We came across a British fund geared towards ethnic minority founders. I intend to apply to that.
3. We have a new SaaS application in the idea stage. I will prepare it for pre-seed funding opportunities. It might attract more attention.
4. We print and post our pitch to those funds that don’t invite applications on their website.
5. We will try to attend a big SaaStr event. By mixing with SaaS companies and VCs, we might find an opportunity to progress.

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