Wow – if you’ve been part of raising any round of venture capital you know how freaking awesome that feeling is that someone (any VC/Angel/Investor) is willing to bet on your idea and your team!
Champagne corks pop and celebrations are in order, for good reason!
97% of startups fail to raise capital – you’re already awesome on several startup levels! Drink in the victory you have attained and then next…?
The Venture Capitalist team than invested in you expects you to deliver on the strategic plan you sold them on.
Let’s have a think about what your VC wants – outside of their investment in your amazing / awesome / market busting startup.
Burn Fast, Burn Bright!
VC Speak 101 (Internal Notes for LP’s only)
CEO Startup Up 101 Speak (Internal Notes only)
Sounds scary, especially if you’re not familiar with the startup world.
Venture capital / investors want you to succeed – or they would not have put money into your business. They also know that startups have a historical 90%+ failure rate. And like the 100 other investments they made this year most (possibly your awesome XYZ) will fail and they are setup to quickly close your business down, sell any IP and move on – much faster than XYZ’s founders are likely willing to give up.
They know on average only 10 will reach year 3 and “maybe” 1 will pay for the entire fund – and make them look like VC Rock Stars!
So. It doesn’t take a brain surgeon to figure out as a startup CEO that sales and most importantly demonstrably repeatable sales or in VC speak MRR – (Monthly Recurring Revenue). Those initial sales post A round investment must take place in a hockey stick / rocket like trajectory.
They the key to a startup’s success and more importantly a ticket to the next B round raise and another celebration!
Startup CEO Keys to A round month 1
By focusing on getting the sales process / systems / solutions part of a startup right as soon as funding arrives, startup CEO’s will succeed or at least understand where they need to change to get to the next round and keep the doors open!