Entrepreneur Tutorial

The Platform

Capital Raise was built to help entrepreneurs increase their odds of raising venture capital. Within the platform, you’ll be guided to set up a profile - the way investors like to see them. The platform enables you to host and share all the information an investor needs to assess your company for investment.

This platform also hosts the profiles of thousands of investors from our network. These investor relationships have been established and maintained over the last 25 years. Through our technology-enabled Capital Raise Service, we use an algorithm to match your company with funds that are the strongest fit. This means the fund's investment criteria and investment history match your company profile. We are then able to make warm introductions via double opt-in emails to the matched investors within our trusted network.

Below you will find more information detailing the Capital Raise Service that we offer.

Profile

Your company profile mimics a one-page executive summary template. If you already have an executive summary, filling out this section will involve cutting and pasting from it.

When completing your profile, the rule of thumb is less is more. Just summarize your business at a high level. Think of this as a teaser, not a business plan. If your team has done a successful startup together in the past, state that. If any of your key team members have had an exit and delivered returns to investors previously, be sure to include this information.

After glancing at the summary information, investors will typically look at your five-year pro forma financial projections, and this is the information many entrepreneurs neglect to provide. While it’s hard to accurately make projections, you need to do this.

When you do your financial projections, it's important that you build them out with the assumption that you will raise multiple rounds of capital. With Series Seed, A, B and, perhaps, C rounds assumed, model out the growth you would generate by hiring sales and marketing professionals to grow the business. For a venture-backed B2B SaaS company, the most attractive models will typically show a doubling of revenue year over year.

Don’t include your valuation. This is something that the investor will typically propose and that you will negotiate later.

When building your profile, it is very important that you fill out each section in its entirety. We will not be able to view your profile or matched investors until every section is completed.

LinkedIn

You will need to link your LinkedIn profile to your Capital Raise profile. Investors and potential connections will likely click on your LinkedIn profile to see if you are someone they would consider backing, so make sure your LinkedIn profile is professional and up to date with all of your accomplishments.

Executive Summary

The executive summary should mirror your profile information. It needs to be uploaded on your profile for an investor to download if the investor wants to print it out to read while traveling or to share it at a partners meeting.

Pitch Deck

Some investors like to flip through a pitch deck without listening to the narration.

You may upload a PowerPoint deck on your profile or link to a DocSend, Pitchly deck, or any other third-party provider. Here are some basic slides we recommend you include in this order:

• Problem
• Solution
• Market Potential
• Management Team
• Go to Market Strategy
• Competition
• Financial Projections
• Funds Requested + Use of Proceeds

Elevator Pitch

The elevator pitch is designed to be a quick pitch that you would give an investor if you had to do it during an elevator ride. It should be no more than 30 seconds with no slides. You will have the ability to add this to your profile.

Full-Length Pitch

This will be a YouTube or Vimeo recording of you going through your slide deck and pitching it. You may use just voice narration, or you may be on camera. We recommend limiting this pitch to eight minutes. You will have the ability to add this to your profile.

Shareable Profile

Once you’ve completed your profile, you can use the link at the top to share your company profile with anyone who would like to learn more about your company, such as potential investors. While you are free to share your profile with anyone you like, we do not recommend doing cold outreach to prospective investors.

When raising capital, it is the referral source that determines whether or not investors look at your company. If your profile is presented by a trusted referral source the investor will scan your profile and decide if they are open to an introduction. You will find greater success when your company is referred to an investor through a trusted referral source or “connector.” If you lack a well-connected referral source, we are able to make warm introductions to matched investors within our personal network through our Capital Raise Service outlined below.

Capital Raise Service

Once you’ve completed your profile you can apply for our Capital Raise Service. This service is a 3-month minimum consulting engagement that provides your company with the following services.

• Help strategically align the company to best position it for financing.
• Review of and guidance on your profile (executive summary and pitch materials.)
• Coaching on Pitch Presentation.
• Develop a Target List of Investors through our matching algorithm.
• Collaborate with founder and board to solidify target list of investors.
• Send double opt-in emails to investors.
• Calls and follow up with investors, email connections to CEO.
• Attend pitch meetings with the entrepreneur and interested investors as desired.
• Guidance on assembling due diligence packet.
• Assistance pulling together syndicate and guidance on negotiating terms with investors to include engaging a law firm and accounting firm.

Our Capital Raise Service allows you to benefit from our founder’s professional network of over a thousand venture capitalists and accredited investors built over a 25-year career as a superconnector. He was global head of business development at Cooley, the leading tech and life sciences law firm for 20 years, where he facilitated multiple billions of dollars of venture financings. He was the first business development professional hired at PricewaterhouseCoopers to help companies with extraordinary potential raise venture capital. He also ran the Capital Attraction Program for the Fairfax County Economic Development Authority, where he doubled the number of venture funds in that county in two years. He also has experience as an angel investor and has participated in venture funds as a limited partner, managing director, venture partner, and management team member of two venture backed companies. His knowledge and experience in getting companies funded has been built into the software platform that is Capital Raise.

To apply for our Capital Raise Service, you will need to return to the Capital Raise landing page. You will find the Capital Raise Service Application at the top of the page. You will need to have created an entrepreneur profile prior to completing this form. Once you have completed your profile, fill out the form with all of the required information. Your application and profile will be reviewed by a member of the Capital Raise team for fundability within our investor network. We will then contact you via email to discuss the next steps. The cost of our Capital Raise Service will be discussed once we reach out following your application. Below you can read through our Capital Raise Service FAQ to learn more about the process.

Capital Raise Service FAQ

The Capital Raise team has 25 years of experience in the venture space. We will not take you on unless we think you are fundable. That said, a very small percentage of companies who seek venture capital, raise it. Through our experience and extremely strong contacts in the industry, we greatly improve your chance of getting looked at, meeting with investors, and raising capital.

How long does it take?

A successful capital raise takes 3 to 6 months if things are going well out in the market. If it isn’t going well, it can take longer or not happen at all. Ultimately, this is out of our control. We can get your information in front of investors, which is looked at and responded to most of the time.

80% of our emails get looked at by VCs because of our relationships with them, however, sometimes they say no by not responding or they are too busy.

What is the process?

Week 1:

Initial kickoff call, review of the Capital Raise profile, suggested changes for the profile, discuss pitch presentation and amount to be raised, which signals anticipated valuation. Since Series A investors typically want a third of the company (20-40%), if investors triple the amount you are raising, they can estimate the valuation you are expecting. We will help you size this right.

We give you an outline for the deck (same as listed above under profile) and guidance on your financial projections and go through it with you. You are to make the required changes, or we can lead you to outside sources to help facilitate the proposed changes. If you need someone to build a financial model, we will refer you to someone who can. This is usually not necessary.

Week 2:

Review deck changes and practice investor pitch with us. This is roughly a two-week process of getting ready for the raise depending on the work you need to get the deck ready. The coaching on the presentation of the deck will take place during the review unless we need to revisit it.

We will develop a target list of investors curated through the platform that we will discuss. We will want to know which investors have already seen your company. We cannot go back to them. We will want to know which investors you want to avoid. i.e., who is invested in your competitors?

Week 3:

Discuss the target investor list. Send emails to 10 initial chosen investors. We do double opt-in email referrals which you will not be copied on. We may not want these initial investors to be the best prospects. We want to test the waters for the pitch. It is not uncommon for CEO’s to change the pitch 2 or 3 times over the course of a capital raise based upon investor feedback and market climate. We can only approach each investor once. In our 25 years of doing this, we have never seen an investor change their mind from an initial “no.” Sometimes, the best strategy is to target the most likely investors after receiving feedback from the market to ensure there is no fatal flaw in the pitch that we missed. The best strategy is to send the emails to investors over time for a couple of reasons. #1) we will get feedback on how we may need to pivot the presentation to get traction in the market. #2) We don’t want to overwhelm the CEO who must run the business as well as raise capital. Historically, a staggered approach has been more successful.

Sometimes, we can arrange a non-pitch, feedback session with a friendly VC. It is helpful to hear how an actual investor reacts to the presentation. If they have interest, they can tell you to circle back when you are ready for a formal pitch. The ground rules are that you don’t ask for money, and they just give you feedback.

Don’t expect investor meetings in month one. This is highly unusual. This is a time-consuming process. VCs are busy and review thousands of deals before investing. Often times they will push you to a junior person, who becomes the gatekeeper. It is important that you show this person respect and be 100% ready to present to them.

Week 4:

Communicate responses from investors and hopefully set up meetings for presentation.
Discuss additional investor emails to be sent out. We will be attending meetings with investors via zoom as desired by the CEO to interpret feedback.

Month 2 and thereafter:

Weekly 15 min catch-up calls to give feedback and strategy on capital raise thus far in addition to ongoing communication and progress from investors and meetings.

Depending on the economic outlook in today’s environment; we are reaching out to 100 to 200 investors or more.

Response times can be slow. Just because you do not hear back from us does not mean things are not happening. Remember, we do double opt-in email referrals which you will not be copied on. If the investor is interested, we will connect you with them to arrange the meeting.

It is quite normal for the VC process to start with a junior person at the fund. These are the gatekeepers to the decision-makers. You must treat these people with respect even if they appear very young and junior. This cannot be emphasized enough.

We will not pass on the contact information when a rejection is received. We have never had a VC change their mind.

Important Note on Etiquette:

You are not paying for our time spent on emails and talking with investors. You are paying for the 25+ years we have spent developing and nurturing these relationships.

The investor contacts of Capital Raise are personal and have taken decades to build. By signing on and working with us the entrepreneur agrees to treat the investors with the utmost respect, even if they don’t like or agree with the investor feedback.