Past Employment: Consultant at Clark Schaefer Consulting, Staff Auditor at Kendle International
Featured Recently in: TechCrunch — “Tracour Locks Up $335K To Help Uncover The Best Financial Analysts”
Do you like bashing your head on the table, being told ‘this wont work’ and having to consistently sell yourself, your idea, and how you will execute this plan 100 times a week? If you answered yes to all of those questions, then you are ready to try and raise money for your idea.
My startup, Tracour, is a project that has been in the works for roughly two years and has taken a considerable amount of time to perfect the model and to get our pitch ready for prime time.
There are few people in this world who can walk into a VC office with an idea and get a check for $10,000,000 to kick start their endeavor…the qualifying statement on that is if you can answer yes to “I sold my previous startup and returned a 10x multiple to our investors”, then you are a special breed.
How we pitched Tracour
Here is the funny thing about Tracour, when we went out pitching, we did not show off Tracour, we showed off Sorsed, a project that we had previously built. Sorsed tracks tech rumors and vets journalists to see who is reliable and is crowd-sourced. We built Sorsed out of fun and it’s a lightweight product from developers’ point of view since it is all crowd sourced.
Tracour ranks financial analysts in real time to see who is generating quality investment advice using automated procedures. Hopefully you can see the comparable here and this began our journey to start pitching.
We got our foot in the door with our one-line pitch, “We rate financial equity advice in real time”, at least, that was our goal at the time of the initial pitch.
When we got face time, we showed off Sorsed and this accomplished two things. 1) It showed that we could build a product 2) It offered talking points about how we can turn Sorsed into our new platform and had easy comparable that investors could see at the time.
Here is what you have to understand; when I finally met with our angel investor and got him to invest he told me something to the degree of:
“I am investing more in you and your ability to execute ideas than I am in concept of Tracour. I like what Tracour will do and I believe you can build a product to deliver on these promises. “
When we pitched to VCs, we had a functioning prototype of Tracour thanks to our angel investment, this made it much easier to show that we were capable of building the platform but required additional funds to reach our goals. At this point, it was “we love the idea and know that you can execute on your promises”.
What it is like to pitch
If you are not willing to be a persistent jerk, you will not survive. You don’t have to be a jerk to the investors (I don’t recommend that) but you have to follow-up, get used to having your calls not answered and most of all, you better be persistent.
Here’s a fun fact for you, Tracour does not have a pitch slide deck; nothing, not a single completed PowerPoint. We always pitched demos, a demo goes so much further than static slides. Our entire pitch was a demo of either Sorsed (angel level) or of the prototype (VC level).
Granted, our financials at that time were pretty simple so we didn’t have customer growth charts so slides would have been boring.
What I learned from this process
1) Be ready to be turned down, a ‘no’ is only part of the process and it only takes one ‘yes’ to complete a deal.
2) If this is your first startup, be prepared to talk about how you are able to be ‘that guy’ who can build this product; They are investing in your ability to execute.
3) You cannot do it all, surround yourself with go-getters and divest the work as needed. Focus on what you are good at (hopefully pitching) and drive that home.
4) Prove that you can build something…Sorsed for us proved that we could build a product and got us our first bit of cash.
Not sure if this will help, but it was our journey to raising money. Build something (anything) to show off that is related to your end goal…let them see what you can do, it helped us out quite a bit.