0/ Thread: After constantly being asked what really changes between raising Seed & Series A, I just published my 9 reasons why Series A is not "just a big Seed round" ♠️ medium.com/the-family-aaa…
1/ Series A is about the future… & the past
While previously your role was to promote your founding team & sell a vision for the future, now your pitch will be about the past, too: how well did you spend the $ you raised before? How good have you been at hiring? etc.
While previously your role was to promote your founding team & sell a vision for the future, now your pitch will be about the past, too: how well did you spend the $ you raised before? How good have you been at hiring? etc.
2/ Now you have a team to think about
While your Seed round probably involved you, your co-founders and 1 or 2 employees, you may now have between 8 & 50 team members. Good time management will be crucial, & it's never too early to start thinking about how to handle the process
While your Seed round probably involved you, your co-founders and 1 or 2 employees, you may now have between 8 & 50 team members. Good time management will be crucial, & it's never too early to start thinking about how to handle the process
3/ Series A Due Diligence is real
While the analysis & paperwork you go through at Seed is usually simple, closing a Series A can take many months from the day you start thinking about it. VCs will need serious (i.e. data-heavy) reasons to justify their investment to their LPs
While the analysis & paperwork you go through at Seed is usually simple, closing a Series A can take many months from the day you start thinking about it. VCs will need serious (i.e. data-heavy) reasons to justify their investment to their LPs
4/ You'll see many things for the first time
Most founders have never done an A round before, & are not familiar with the terms used or the materials required by VCs. Even if un-natural, you'll have to get your head around things like building a data room & negotiating liq pref
Most founders have never done an A round before, & are not familiar with the terms used or the materials required by VCs. Even if un-natural, you'll have to get your head around things like building a data room & negotiating liq pref
5/ It's hard to know when you're really ready for Series A
Knowing when to start raising is hard, as Series A sits in between being a Seed startup raising on promise & being a Series B co raising with solid metrics. How you tell your story can be more crucial than your metrics
Knowing when to start raising is hard, as Series A sits in between being a Seed startup raising on promise & being a Series B co raising with solid metrics. How you tell your story can be more crucial than your metrics
6/ At Series A, time is a serious matter
• You don't want to start raising too early - hard to get anyone interested
• You want to increase spending to show you're capable of investing in growth
• You don't want to "gamble" too much & raise too close to end of runway
You:
• You don't want to start raising too early - hard to get anyone interested
• You want to increase spending to show you're capable of investing in growth
• You don't want to "gamble" too much & raise too close to end of runway
You:
7/ Series A is a numbers game, and a tougher one than Seed
Like with your Seed round, at Series A you still need to speak to a large number of VCs. But you're starting with a much smaller pool of them. Finding 30+ VCs who may be interested in your sector & stage can be tricky
Like with your Seed round, at Series A you still need to speak to a large number of VCs. But you're starting with a much smaller pool of them. Finding 30+ VCs who may be interested in your sector & stage can be tricky
8/ Your VC at Series A is more crucial than at Seed
You need to choose your VC wisely, because Series A investors are very likely to take a board seat & work with you for the long term. Given the DD they did on you, they'll be considered by later investors as your reference VC
You need to choose your VC wisely, because Series A investors are very likely to take a board seat & work with you for the long term. Given the DD they did on you, they'll be considered by later investors as your reference VC
9/ You need to convince teams, not individuals
Differently from Seed, it's uncommon for a single person at a fund to make the call for a Series A all by themselves. If someone else in their team is against the deal, it won't happen. You'll have to juggle VC internal politics
Differently from Seed, it's uncommon for a single person at a fund to make the call for a Series A all by themselves. If someone else in their team is against the deal, it won't happen. You'll have to juggle VC internal politics
10/ In case you've gone past your monthly reading limit on Medium, here's a link anyone can use :) medium.com/p/9-reasons-wh…
