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10/10 Founder Series — Part 5: Helpful Fundraising Tactics

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Alix Ventures: Supporting Early Stage Life Science Startups Engineering Biology to Drive Radical Advances in Human Health

Calling All Innovators Click to Reach Out 🚀

We are honored to feature founders at:

A-Alpha Bio, Gordian Biotechnology, Anagenex, Dimension Inx, Rarebase, Tierra Biosciences, Getlabs, Slope, Ochre Bio, Clara Health, & Enveda Biosciences

We asked our guests:

“Looking back on your first fundraising round, what tactics did you find helpful?”

“Wait until your story/data is razor tight to engage; then engage like crazy (ask everyone for intros, etc). It’s a game of optionality. VCs want to delay for more datapoints on you, you want to get them to make a decision (yesterday). The best means of flipping the power dynamic is time pressure, and the best way to create that pressure is to have as many diligence discussions going in parallel as possible. Plus, it’s less stressful when you’re busy (at least you feel like you’re making progress!).”

Jack O’Meara — Co-Founder & CEO @ Ochre Bio

“Remember that investors’ decisions say nothing about the promise of your company. They have various reasons for not investing, including being wrong about you.”

Martin Borch Jensen — Co-Founder & CSO @ Gordian Biotechnology

“Two things, one practical, one less so; 1) Identifying a lead investor will make everything else fall into place, and 2) Finding the right partners is a bit like dating, and takes time to get to know each other, even pre-pitch.”

Zachary Sun — Co-Founder & CEO @ Tierra Biosciences

“Run a tight process. Find your lead first, and then you’ll see that the round fills up quickly.”

Viswa Colluru — Founder & CEO @ Enveda Biosciences

“Personally, my favorite fundraising hack is to be fairly open. I’ve known people who have a “we’re in stealth” attitude and are very reluctant to share many details around the technology. Of course there are a few things you have to be careful about, and this depends on the sector and competitive landscape, but companies succeed on execution more than anything else. The VC and their investments are unlikely to be able to put your “bits” together the way you will, which is presumably the best way to do so. Giving a little more detail builds trust and helps the investor really understand your unfair advantage. It also gives you a chance to see what good questions they’ll ask, see above.”

Nicolas Tilmans — Founder & CEO @ Anagenex

“First off, never stop fundraising. I started planning our next raise the day after I closed our most recent one. It’s also helpful to remind yourself regularly that you are the one in the driver’s seat of this process. Vet your potential investors just as hard as they vet you.”

Rust Felix — Co-Founder & CEO @ Slope

“I always like to focus on the product. If fundraising efforts are going too slow or there’s too much friction, when possible I’ll go back to building the product, engaging customers, etc. This is the best way to ultimately get investors on your side, by de-risking the business and making progress on your product, which is what you need to do as an entrepreneur anyway.”

Onno Faber — Co-Founder & CEO @ Rarebase

“Lining up intros from portfolio company founders and/or co-investors goes a long way and it helps to build relationships before beginning the raise. Nothing surprising here, but these tactics made the process go smoothly.”

David Younger — Co-Founder & CEO @ A-Alpha Bio

“Preparing for when we would formally open a round — e.g. not “trickling” in the process, and deciding if it will be a led vs. party round. We had times where we started to have inquiries from investors when we weren’t looking to raise a round, and then just started speaking with more investors. Eventually when we started speaking with investors who we wanted to work with the round already looked like it had been open for months and had random commitments, even though that’s not what we were planning, and it made it harder to close the raise.”

Sol Chen — Co-Founder & President @ Clara Health

“One of the most valuable things was identifying a couple of well networked individuals early on with whom I could be vulnerable enough to ask candid questions and receive sage guidance in return. I was grateful for the honest feedback, eagerness to help, and willingness to open doors.”

Caralynn Collens — Co-Founder & CEO @ Dimension Inx

“For me, the best approach to pitching has always been not pitching. I genuinely believe in developing sincere relationships before investing to make sure these are individuals I want to work with and vice versa. Once they’re on your cap table, they’re there. I’d rather take the time to make sure they’re the right fit for us.”

Kyle Michelson — Founder & CEO @ Getlabs

Insights

Following up on our last post exploring how founders choose their VC partners, we asked founders what was most helpful in their first fundraising round. Although each company has different experiences, our key takeaways are (1) prepare wellーthink about timing, plan ahead, make sure your story is sharp, (2) identify the right investors for your company and work towards getting warm intros, and (3) form strong relationships with potential investors to ensure fit (founder/investor relationships are long!). Unsurprisingly, these themes run parallel to the insights from our earlier posts on VC-advice to future founders. On both sides of the table, spending time building trust is non-negotiable.

📣 If you enjoyed this post please clap 👏 & comment 💬 to let us know

❤️ Special shout out to Amee Kapadia for putting this issue together

Alix Ventures, by way of BIOS Community, is providing this content for general information purposes only. Reference to any specific product or entity does not constitute an endorsement or recommendation by Alix Ventures, BIOS Community, or its affiliates. The views expressed by guests are their own and their appearance on the program does not imply an endorsement of them or any entity they represent. Views and opinions expressed by Alix Ventures employees are those of the employees and do not necessarily reflect the view of Alix Ventures, BIOS Community, affiliates, and content sponsors.

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