Letter to a founder about to raise a major growth round
Picking a Growth VC Firm is about making a partnership commitment of five to ten years. Some marriages don’t last that long. Our advice — Focus beyond Capital and Valuations to choose the right partner.
There is something magical about raising a growth round. Finding a product-market fit is both exhilarating and harrowing at the same time. Exhilarating because you crushed your series A OKRs, people are lining up for your product/service, the market pull is obvious, and VCs are eager to fund your next round and “help”.
But it can also be harrowing, as you’re now in a race for scale. Everyone sees your game, and copycats and fast followers have a chance to leap ahead now that you have done the heavy lifting. There is most likely no second place in the “winner takes all” digital economy, and you know it. So the race is on!
As a founder at this inflection point you need:
1. Capital to fuel your growth, to stay ahead, and to reinvest as fast as you can to keep your lead.
2. Resources, advice and support to juggle four simultaneous and parallel functions:
- Keep your product roadmap and tech stack ahead of the competition — balancing customer demands for features while building out your R&D team to meet those demands and avoid getting bogged down and falling behind.
- Hire fast and preserve your culture of high performance. This often means having tough conversations about upscaling your exec team.
- Scale your sales, service and operations in lockstep with demand — where the weakest link can pull everyone down.
- Think about M&A that can fuel your growth strength — something you typically would not have to think about until now.
Money (and valuation) is the easy part of this equation. The world is awash in cash where capital is now a commodity (at least for now), and plenty of VC firms will court you for a place on your cap table. The key decision is not about money; it’s about choosing the right board members and the right firm.
A great firm will provide a board member emotionally committed to your success. They will bring you and your team a depth of tactical and strategic expertise, experience, contacts, candour and a willingness to work side by side through the ups and downs of the years to come; they’ll make a real and positive difference in your personal and company’s growth.
This is why Inovia has built a partnership uniquely qualified to answer your growth needs. Our partners are not career financial professionals. Like you, they have been building companies for decades and have been on the ground floor of startups and some of the most desirable companies worldwide. They know the commitment it takes to build a great company. In addition to their personal experiences, each has an unparalleled network of advisors and experts, who in turn bring insights and guidance on each step of your journey.
With this context in mind, Inovia is delighted to share that we have recently welcomed some exceptional additional team members who deepen our bench.
Technology: the art of building a strong developer team
“Tech is more than clean code. It’s about teams fueled by insights, creativity, and velocity. ”
Scaling the engineering or product side of an organization is challenging. While the technical side gets a lot of attention, the talent side is arguably as important. The complexity of team building is often not visible to first-time founders, and very few people have done it at scale.
That’s why we are delighted that Steven Woods has recently joined us as Partner and CTO. Steven is an icon in the Canadian tech ecosystem. A University of Waterloo graduate, he built companies and led Google’s Canadian engineering teams for over a decade. Back end, Front End, ML, API integration, Steve has seen it all and brings a fantastic E-Q to the conversation, something too often overlooked. And like all Inovians, he’s an amazing human being.
Talent: hiring the right people at the right phase of growth
“A players hire A players. B players hire C players. That’s the nut of it. But how do you ensure you bring in only A players WHILE building a team you can trust to scale?”
To say that successfully attracting and retaining talent in today’s highly competitive market is tough would be a gross understatement. It is a white-hot market for great talent out there, and candidates are in the enviable position of being able to work from pretty much anywhere. Distinguishing your company from the pack is imperative to take your business to the next level, so you better throw your full force behind building organizational structures and systems to attract top-notch candidates and create a culture where A players can thrive.
To that end, Inovia is lucky to have recently recruited Krista Skalde as Partner and Chief Talent Officer. Krista is a proud Franco-Ontarian who has spent most of her career around the globe in various HR/Talent consulting positions and leading People Operations for large organizations, including leadership development, organizational design, change management, and executive coaching. And yes, like all Inovians, Krista is an amazing human being.
Go-to-Market and Operations: learning to juggle means keeping your eye on the balls
“When your rocketship takes off, bottlenecks pop up everywhere. And yet, customers and your team can’t wait — you have to deliver flawlessly. All this while you are hiring and onboarding at an accelerated pace.”
If strategy is about insights and brilliant ideas, operations are about execution. And execution in a fast-growth environment sometimes can feel overwhelming — a bit like juggling spinning plates. Plates like sales productivity and expansion, like load leveling across sales, service, support, engineering, like proper planning to stay ahead of the demand, like building the tools and infrastructure so that you don’t have to rip and replace 12–18 months later and lose momentum. All that while upgrading your exec team and strengthening the culture, and… by now you get the point: scaling is an art. Having the experienced resources will save you years of hardship and transform daily pain and anxiety into excitement and control.
When Dennis Kavelman and I joined nearly five years ago now, we expanded Inovia’s know-how with our decades of hands-on operator experiences — both good and bad. The bad ones not only make for some of the best dinner stories but also provide our best learnings. We both have had the privilege of living through the hyper-scale of building global businesses — Dennis at RIM Blackberry from its very early days (employee #26!) and me at Google and Twitter. Since then, we have had a ball coaching amazing founders, like Dax and JP at Lightspeed, Eric at Zwift, or Adrian at AlayaCare, to name just a few.
M&A: closing the deal is just the beginning
“As your company scales and competition heats up, M&A can be a defining strategic tool. And one often overlooked.”
For many growing companies, M&A is one of the essential elements to accelerating roadmap and building competitive advantage. The challenge of managing a successful acquisition with a robust integration is a massive undertaking. There is so much to consider, from how to communicate to your stakeholders to integrating different cultures. Because it’s risky and feels uncomfortable, it is often put aside — but that is a strategic mistake.
Scott Munro — yes, another Canadian, but living in Silicon Valley for decades now — leads the M&A practice at Inovia. Scott brings more than 30+ years of operating and financial advisory expertise to the firm. He advises portfolio companies on proactively managing their path to maximizing valuation — either through M&A or IPO. Scott is an experienced operator and has assembled a comprehensive playbook on how to make best-in-class acquisitions with successful integrations. Did I mention, that like all Inovians, he’s another amazing human being.
As I wrote at the beginning of this blog, there is something magical for founders raising a growth round. It is a unique juncture, one that will define your leadership, your company’s velocity, and your chance to consolidate your competitive position.
We’ve shared how Inovia is uniquely positioned to make a lasting impact on your team beyond capital injection. I am proud and delighted that we can offer some of the very best Canadian and global expertise to support our portfolio companies.
If you have or are about to hit this milestone, we can’t wait to hear from you. Until then, remember to play hard, but keep your stick on the ice!
Don’t be shy. Reach out!
