Fri, 16 July 2021
Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.
Deal flow is key to successful startup investing.
It takes a great deal of time, so it’s important to build a strong process for managing it.
It helps to use a software tool to track it.
Start with the key steps for running deal flow as follows:
Set up a deal flow source with angel groups, venture funds, online portals, and others.
Capture deal information into the software tool with their key information.
Run an initial screen to see if it meets your criteria -- have 3-5 key points to check.
Set up the first call to find out more details and update the deal flow software with the results.
Set up a partner meeting to review the deal with others in your fund, syndicate, or network.
Negotiate valuation and terms.
Perform diligence on the deal.
Close the investment.
Set for ongoing follow-up and reports.
In each step, capture the results into the software.
On a regular basis, analyze those results to find the following:
-Which sources gave you the best deals
-How much time did the calls take to capture the necessary information to make a decision
-What key factors the startup must have to go all the way through to funding
After analysis, update your process to screen out deals that won’t make it.
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Music courtesy of Bensound
Fri, 16 July 2021
In this episode, Hall welcomes Ken Hubbard, CEO of The Pitch Company.
As investors, The Pitch Company feels that business leaders would be more successful if they could get their company story out more concisely and with the pertinent information they need, in an expedited and organized structure. The Pitch Company’s frustration with the process led them to test over 60 different pitch templates for effectiveness. They realized it was not just the template that was the culprit, but the need for coaching by investors that makes the difference.
Building his first company in 1988, Ken, late to the party, scrambled to catch up to the rocketing computer industry. He shortly found a home in one of the fasting growing integration companies followed up with starting and developing revolutionary data center equipment. After a short hiatus, he began dabbling in angel investing.
Though he had raised significant funding, both debt and equity throughout his career, being on the other side of the table, as an investor, came with a different type of responsibility. Business leaders wanted advice on their business. Ken quickly learned that most business leaders had a basic understanding of how to pitch their companies but didn't understand what the investors were interested in and how they wanted the information. So he studied all the great presentations, built a system, and tested it for over 4 years.
Ken discusses how he sees the state of startup investing progressing post-COVID-19, some of the challenges startups face, and how The Pitch Company fits into the landscape.
Music courtesy of Bensound.