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I will never forget the day a leading Silicon Valley venture capitalist blatantly regretted forgoing a previous round of funding. We were back at the table on a next round, and they didn’t want to miss the opportunity twice. Investor rejection always stings a bit, but it’s a humbling experience to see these companies end up turning to our company. After all, it’s a community that likes to brag about betting on the next big thing – without admitting defeat.

Having served in a leadership role in my company Arctic Wolf for most of its six fundraising rounds totaling hundreds of millions of dollars, these memories prompt me to reflect on what might have changed between those early, mid and late fundraising meetings. . Certainly, the hard work, courage, determination and achievements of our team had propelled the company forward to gain more interest from the investment community.

On the other hand, in the small and often isolated world of courting investors for new injections of capital, I wondered what could have changed in the very important presentation of the pitch. It’s about the countless hours of hard work, determination and dedication of your team distilled into beautiful slides, a small management team and a well-prepared presentation. When it was all on the line to get the funding, here’s what I learned from those early, mid and late pitch meetings and how our presentation evolved through each phase.

At the beginning, it’s all in the story.

Start-ups all know the importance of nailing the history and vision of the company at those first investor meetings. But the story you present should be in sync with the story that is being told publicly about your business and its leaders. Investors will enter these meetings by having searched for you on Google and flipping through any news articles they can find. Does the story and vision you present reinforce the story audiences are already telling about you? Are your positioning and value clear and understood in the court of public opinion?

Presenting your business in the early rounds is all about getting investors to buy into your founders’ vision and market potential for the business, both through storytelling and a well-thought-out plan for how. the vision will lead to subsequent execution. A well-connected founder can open the doors to those early meetings, but be sure that what venture capitalists (VCs) find on their own strengthens and supports the story you’re telling on the ground. You don’t want to spend time dispelling myths in those critical conversations that can make or break your startup.

In the middle, the numbers will trump (almost) everything.

Start-up investors are ready to bet on an innovative idea and a solid vision, but after securing those early rounds, the dynamics change. You are now on the proving ground, with investors likely sitting in your boardroom and evaluating the decisions you make as a leader. Intermediate funding cycles – those needed to invest in growth, scale, expansion, and product development – are where metrics need to guide the narrative and articulate market potential for the company and its investors.

Are your turnover and growth rates taken into account to achieve a higher valuation of the company? Is your gross margin improving? Is your money consumption healthy or, at a minimum, up to benchmarks? Are your customer acquisition costs sustainable and improving? How do you see net retention? Above all else, the pitch should reinforce the sound financial performance of the company to give investors important context and a sense of stability as they move into due diligence and data review, ready to invest for future growth. .

A critical step here is to build a solid foundation both on the business itself but also on how you plan to bring the business to market. This includes your distribution strategy, your alliances (or lack thereof), the geographies in which you will sell or sell (or will not sell), market segments, exploited and untapped industries and the opportunities on the horizon. The context shows that you had a plan, but more importantly, that you have a plan for the future – outside of the spreadsheet.

In the later stages, the story and the performance must work together.

At this point in your business growth, late-stage investments are meant to help you build the war chest you need for a possible IPO, exit, or other liquidity events. The company is more established and is beginning to achieve the scale and market performance necessary for stable earnings and returns. Entering later stage funding cycles is about marrying past and prospective financial performance with your vision and scale strategy.

Subsequent rounds should capture the excitement and enthusiasm for the business and its potential as much as they articulate financial preparation for the next phase. The company’s narrative and its financial performance must complement each other to tell a more complete story of the future.

Adapt or die.

The relationships, reputation and vision of our founder opened many doors that led to our early funding. Dealing with a constant stream of rejects in the middle of the towers strengthened our resolve as a company and forced us to focus on what was important. No ride has ever been easy, but difficulties have come in different forms. And as the investor meetings continued, adjusting our approach and balancing how we presented our story, mission, financial performance and forward-looking strategy helped us to get us to where we are today. Our pitch has evolved, and it seems their thinking about the desirability has, too.

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The opinions expressed here by the columnists of Inc.com are theirs and not those of Inc.com.

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