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Melissa Bradley wears many hats. She’s the co-founder of a startup called Ureeka, an investor at 1863 Ventures, and a professor at Georgetown’s business school. So it’s not an understatement to say that she understands the fundraising process from every angle. And moreover, she has both invested and fundraised for her own startup during this last year, where the landscape has shifted drastically. At TechCrunch Early Stage, she led a session on how to nail your virtual pitch meeting.
Bradley covered how to allocate your time during the meeting, how to prepare, how to close out the meetings with a clear list of action items, and what to avoid.
You can watch the session or check out the full transcript below, but I’ve also pulled out a few highlights from the talk just for you.
Enjoy!
Conversation > Pitching
One of the greatest shifts in the pitch landscape during the pandemic was the nature of meetings themselves. Because investors and founders can take 30 meetings a day from the comfort of their home, it means that conversation has been prioritized over presentation. Adding to the need for conversation is the fact that investors aren’t ‘getting to know you’ IRL as they would in the past, and so how you interact (not just the content of your pitch) is critically important.
Bradley explained that planning for extra time to answer questions and go deep on strategy is more important now than ever.
Now is the time to really have a conversation and deeply engage the investor in your story and your vision. You want to be conversational in nature, but still formal in tone. So you want to be respectful; you want to avoid jargon; you want to make sure it’s clear what you’re talking about. But it’s really much more of a two-way conversation than we’ve probably seen before. I think again, pace yourself, be really clear in advance how much time you have. One-third of the time should be spent on your pitch, and the other two-thirds, you should be prepared to field questions and really have that conversation. Pace yourself. Don’t rush through. If you only have 30 minutes, it’s probably not the best time to do a demo. You might want to follow up with a recorded demo or make an offer to do a demo afterwards. (Timestamp – 6:03)
Strategy > Projections
Open-source software gave birth to a slew of useful software in recent years. Many of the great technologies that we use today were born out of open-source development: Android, Firefox, VLC media player, MongoDB, Linux, Docker and Python, just to name a few, with many of these also developing into very successful for-profit companies.
While there are some dedicated open-source investors such as the Apache Software Foundation incubator and OSS Capital, the majority of open-source companies will raise from traditional venture capital firms.
Our team has raised from traditional venture capital firms like Speedinvest, open-source-specific firms like OSS, and even from more hybrid firms like OpenOcean, which was created by the founders and senior leadership teams at MariaDB and MySQL. These companies understandably have a significant but not exclusive open-source focus.
Our area of innovation is an open-source AutoML server that reduces model training complexity and brings machine learning to the source of the data. Ultimately, we feel democratizing machine learning has the potential to truly transform the modern business world. As such, we successfully raised $5 million in seed funding to help bring our vision to the current marketplace.
Here, we aim to provide insights and advice for open-source startups that hope to follow a similar path for securing funding, and also detail some of the important risks your team needs to consider when crafting a business model to attract investment.
Strategies for acquiring open-source seed funding
Obviously, venture capitalists find many open-source software initiatives to be worthy investments. However, they need to understand any inherent risks involved when successfully commercializing an innovative idea. Finding low-risk investments that lead to lucrative business opportunities remains an important goal for these firms.
In our experience, we found these risks fall into three major categories: market risk, execution risk, and founders’ risk. Explaining all three to potential investors in a concise manner helps dispel their fears. In the end, low-risk, high-reward scenarios obviously attract tangible interest from sources of venture capital.
Ultimately, investment companies want startups to generate enough revenue to reach a valuation exceeding $1 billion. While that number is likely to increase over time, it remains a good starting point for initial funding discussions with investors. Annual revenue of $100 million serves as a good benchmark for achieving that valuation level.
Market risks in open-source initiatives
Market risks for open-source organizations tend to be different when compared to traditional businesses seeking funding. Notably, investors in these traditional startups are taking a larger leap of faith.
However the outcome of today’s vote count turned out, there was one thing we knew for certain: it wasn’t going to mark the end of the battle between Amazon and the Retail, Wholesale and Department Store Union. With voting having broken overwhelmingly in Amazon’s favor, the union was quick to challenge the results.
The RWDSU was quick to offer TechCrunch a statement from President Stuart Appelbaum after no votes broke the 50% threshold, noting, “We demand a comprehensive investigation over Amazon’s behavior in corrupting this election.”
Amazon, unsurprisingly, was quick to take a victory lap. In a blog post credited to “Amazon Staff,” the company writes:
Thank you to employees at our BHM1 fulfillment center in Alabama for participating in the election. There’s been a lot of noise over the past few months, and we’re glad that your collective voices were finally heard. In the end, less than 16% of the employees at BHM1 voted to join the RWDSU union. It’s easy to predict the union will say that Amazon won this election because we intimidated employees, but that’s not true.
While the company was quick to state that the election is “over,” the RWDSU is hopeful, both in terms of future organizing at the Bessemer warehouse and for what the movement will mean for unionizing efforts at Amazon, going forward.
In a press conference held earlier today, Appelbaum suggested that Amazon told workers that they would have to vote against the union if they wanted to keep their jobs.
“We believe a rerun election is going to be very likely,” the union president told media. “I think that if Amazon considers this a victory, they may want to reconsider it. At best, it’s a Pyrrhic victory. Look at what happened during this period. We exposed atrocious working conditions at Amazon for everybody to see.”
Appelbaum’s comments seem to refer, in part, to numerous reports of workers urinating in bottles over concerns about stringent quotas. In the midst of an aggressive social media campaign at the apparent behest of CEO Jeff Bezos, the company initially denied reports, before conceding they may apply to some drivers. Amazon was quick to deflect blame to broader industry issues, however.
“Amazon didn’t win—our employees made the choice to vote against joining a union,” the company added in its post. “Our employees are the heart and soul of Amazon, and we’ve always worked hard to listen to them, take their feedback, make continuous improvements, and invest heavily to offer great pay and benefits in a safe and inclusive workplace. We’re not perfect, but we’re proud of our team and what we offer, and will keep working to get better every day.”
A key part to the RWDSU’s challenge is a ballot box the company reportedly pressured the USPS to install, in defiance of a National Labor Relations Board ruling. Appelbaum said the box “creates the impression of surveillance.”
He added that the union has already been in communication with workers at other Amazon facilities, explaining, “We have already started talking to workers at other facilities, as well, before this election.”
From building out Facebook’s first office in Austin to putting together most of Quora’s team, Bain Capital Ventures managing director Sarah Smith has done a bit of everything when it comes to hiring. At TechCrunch Early Stage, she spoke about how to ensure the critical early hires are the right ones to grow a business. As an investor at Bain Capital Ventures, Smith has a broad view into the problems that companies face as they search for the right candidate to spur organizational success.
In our conversation, Smith touched on a number of issues such as who to hire and when, when to fire, and how to ensure diversity from the earliest days.
What to consider when you first think about hiring
When a company is making its first hires — and then evolving into a bigger organization — the processes and needs may change, but the culture should be consistent from the beginning, according to Smith. From there, an emphasis on good early managers is critical.
I would really encourage you to take some time to think about what kind of company you want to make first before you go out and start interviewing people. So that really is going to be about understanding and defining your culture. And then the second thing I’d be thinking about when you’re scaling from, you know, five people up to, you know, 50 and beyond is that managers really are the key to your success as a company. It’s hard to overstate how important managers, great managers, are to the success of your company.
So we’ll talk a little bit about how to think about that, as there’s a lot of questions around helping people grow into management for the first time. You, as a founder, might be managing people for the first time, so how to think about setting up the company for success.
(Timestamp: 4:15)
