Fundraising advice for entrepreneurs, from CO Everywhere's recent $6 million round
The $6 million round happened after Longo had successfully raised about $1.5 million from individual investors, and executed a major pivot. (The company began life as a website that collected information about neighborhoods, and it was known as Block Avenue.) That's not a trick that every seed-funded startup will be able to pull off. So I asked Longo to share some of the fundraising lessons he learned along the way. His advice is below, with any of my clarifications in brackets [ ]...
• If a VC doesn't invest in you on your first meeting, chances are they never will ("invest" meaning they schedule a follow-up for the next day, or bring other partners in immediately.) You know when this is happening. It's very clear and beyond exciting.
• Listen more. When two or three VCs pass on you, you need to re-adjust. Maybe a new pitch, maybe an entirely new product. Don't do what I did and just plow through more meetings.
• Every pitch needs to be strategic. Don't pitch until you are ready to raise. Introduction meetings to "show and tell" [what you are working on] will be the death of you with that firm.
• Time management is crucial. At this stage, your time is worth way more than any VC's time. Cut meetings short if it's clear they are not a good fit; investors will respect you for that.
Tips for entrepreneurs:
• Immerse yourself as deep as you can into your local technology ecosystem. We started at Dogpatch Labs and met a key group of influencers who introduced us to other groups. Here, I met my co-founder Dan Adams. Also, our Dogpatch neighbors Joshua Summers & Doug Hurd from Clypd introduced us to David Chang and the PayPal Start Tank, which has been one incredibly awesome resource for us. [CO Everywhere is currently based at Start Tank, which offers free office space to selected startups.]
• Lead investors are instrumental in any early-stage company. Focus on finding a few leads and everything else will fall into place. I am not sure we are where we are without Eric Silverman, Semyon Dukach, Robin Brown and a few friends from State Street Bank.
• A great VC won't leave you empty-handed. The second-best thing a VC can do for you, aside from invest, is help open doors and make introductions. One in particular personally helped set us up with several San Francisco-based firms, as that is where he thought this company should live.
• Network like crazy (online and offline).
• Skip everything and build a great product. Just get what you need to create something special, don't get distracted with "the other stuff."
The CO Everywhere app, incidentally, is really worth getting — it's a fun way to keep tabs on places you care about, whether a ski resort you visit a few times every winter or the town you went to college in.
About Scott Kirsner
Scott Kirsner was part of the team that launched Boston.com in 1995, and has been writing a column for the Globe since 2000. His work has also appeared in Wired, Fast Company, The New York Times, BusinessWeek, Newsweek, and Variety. Scott is also the author of the books "Fans, Friends & Followers" and "Inventing the Movies," was the editor of "The Convergence Guide: Life Sciences in New England," and was a contributor to "The Good City: Writers Explore 21st Century Boston." Scott also helps organize several local events on entrepreneurship, including the Nantucket Conference and Future Forward. Here's some background on how Scott decides what to cover, and how to pitch him a story idea.
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