I won’t use this space to stop anyone from starting a startup, but founders need to embrace the fact that investors are looking for reasons not to give you money these days.
You may not have much income. Or maybe too much of your cash flow depends on a single customer. Oh, and when are you on track to join the $100 million ARR club?
Given the current circumstances, best practices for fundraising and matching with investors are less relevant than they were a year ago. Back then, the promise of early growth was enough to help many teams close the seed and Serie A rounds.
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Today, startups with long sales cycles that are not cash flow positive may not even qualify for follow-up investments.
If you’re curious about what types of startup investors do (and don’t) want to look at, Yamin Durrani, CEO of Kami Vision, has written an extensive post about the changes he observed between fundraising in Q4 2021 and Q3 2022.
“Don’t panic, VCs are interested in investing right now – just in a few areas,” he writes. In his article, he shares the seven tactics he used to successfully raise money, such as planning to pitch 30-60 investors.
Right now, it’s taking longer to raise less money that will value your business lower than you’d hoped. But if you start a startup with the intention of getting rich, you are already on the wrong track.
Thank you for reading,
Editorial Manager, BestFitnessBands+
Grow Cheat Code: Use Fractional Hiring To Stay On Plan When Cutting Costs
As the winter winds begin to blow, major tech companies like Google, Microsoft and Lyft have each instituted employee freezes.
Similarly, early-stage startups are under pressure to reduce burnout while maintaining forward momentum, but “fractional hiring is a cheat code for growth” when used strategically, says Teja Yenamandra, co-founder and CEO of Gun.io.
“There’s a lot less competition now for the talent you hire, and you might be able to bring in someone who was unaffordable a few months ago.”
Dear Sophie: What are the student and work visa processes for graduates?
I am in India. I am interested to apply to US universities next year to study computer science and artificial intelligence and eventually work in the US
Could you please explain the visa process for both students and professionals who want to work in the US after graduation? Is there anything I can do to plan ahead?
— Lively student
Robotics scene remains optimistic, but layoffs threaten
This week on TC Sessions: Robotics 2022, Natasha Mascarenhas spoke with three investors about how “a capital-intensive industry with a longer sales horizon and a lot of infrastructure hurdles” is weathering this downturn.
- Kelly Chen, partner, DCVC
- Bruce Leak, Founder, Playground Global
- Helen H. Liang, Founder, FoundersX Ventures
“On the less rosy side, I think the layoffs are yet to come,” Chen said.
“In an economic downturn, the customers will be less willing to experiment, so they think about cost savings, and then the economy just becomes so much more important.”
Pitch Deck Teardown: Arkive’s $9.7 Million Seed Deck
Last week, Haje Jan Kamps covered the “blockchain-powered museum” Arkive’s $9.7 million seed round that it will use to build a decentralized museum curated by the crowd.
This week he reviewed 12 slides of Arkive’s winning pitch deck:
- cover slip
- mission slide
- problem slide
- Solution slide
- Business model dia
- Value proposition slide
- Roadmap slide
- Market context slide
- Market size slide
- Milestones and the next slide
- team slide
- closing slide
Which downturn? Investors remain bullish on HR technology as the Great Resignation slows
Levi Strauss is popular with Bay Area entrepreneurs: A Bavarian immigrant who arrived during the Gold Rush opened a dry goods store that sold supplies to speculators hoping to fill the pockets of their new jeans with shiny nuggets.
Like Strauss, HR tech startups that help other companies search for golden talent have seen their fortunes soar as the Great Resignation made managing, recruiting and tracking applicants more important than ever.
“As the pandemic accelerated long-term shifts to more digital, distributed, and data-driven work, innovation in HR technology has exploded,” said Allison Baum Gates, general partner at SemperVirens Venture Capital.
Can Medicare Save the Insurtech Market?
In 2020, the US spent nearly 20% of its GDP on health care. Every day, about 11,000 people turn 65, making them eligible for Medicare, a federally funded health insurance program that enrolls new patients faster than ever.
Companies that can help consumers navigate the complicated Medicare market stand a good chance: “The average senior has to choose between 57 different subscription options, and most can’t tell them apart,” said TX Zhuo and James Shecter of Fika Ventures. .
They shared their six-point investment thesis with TC+ readers to show how Medicare is the “bright spark” that could illuminate “the entire insurtech market.”