Glory or Valhalla. When does a startup founder need to care about PR
I’ve recently been asked if the public image of startups and founders is important in the VC’s decision-making process.
TL;DR the public image matters.
But what kind of PR and media coverage is considered a positive factor and what should every startup founder remember about their personal brand? Here are some of my thoughts.
Relevant PR vs PR as a red flag
Before investing in a startup, we conduct OSINT (Open Source Intelligence) check on the Company and its founders. We check articles, social media data, observe how the founder presents themselves to the public, what they say, and what others say about them. We assess startups through the lens of the founders’ personalities, business metrics, and market opportunities. So this type of evaluation can reveal a lot about the founder’s personality and values.
We also look at market messages: the founder’s public profile can be used for B2B sales outreach, as well as appearing in tier-1 and tier-2 media outlets can be part of a B2C startup’s strategy to build trust with customers. However, if media appearances do not align with business goals and only highlight the founders’ vanity, it is a red flag for me. Building the product should come first, and public profiles can be developed afterward.
Is it already too late to invest in a startup featured in the media?
It depends on the stage and focus of the venture capital firm. We focus on Late Seed/Series A companies, so often our startups become noticeable after we invest in them. Specifically, we aim to find companies that have not yet received too much media attention. Moreover, industries that receive significant media coverage are often overvalued and already have vast infusions of capital, so it doesn’t make much sense to invest there unless the startup is doing something truly outstanding. On the other hand, if a VC firm’s focus is on late-stage startups, gathering indicators from the media can be useful.
The right time for starting PR activities
It’s highly individual, but the most important thing is to establish a clear correlation between the business and publicity. PR can help with hiring, support marketing activities, and facilitate valuable partnerships. In all other cases, attempts to gain media attention will be merely superficial. Once again, it’s essential to prioritize building processes (and possibly the product and sales), understand positioning, craft the key messages that align with branding goals, and create a compelling story after all. Otherwise, it’s a waste of time, especially if the startup decides to pivot in six months.
When publicity balks fundraising
Certain information from public sources can influence investment decisions. We had a case where research revealed that the founder had questionable associations, which posed certain risks. Furthermore, publicity can raise a red flag if the founder has published 20 social media posts, commented on 5 media news items, and spoken at 3 conferences within a month while the startup hasn’t shown any significant growth. That is a waste of time and one more red flag about the founder.
However, a well-considered strategy for appearing in the public space tends to help convince investors that the founder possesses a combination of hard and soft skills and is capable of both building a product and effectively selling it through media, events, or their own blog.
Do you run an innovative tech startup? We are investing in early-stage revenue-generating software startups across the world and would love to hear from you! You can reach us at info@leta.vc or fill in the form here.
