Conquer Your Fundraise Like Alexander the Great
Greetings, Chief Storytelling Officers.
This tweet popped up on my feed this week.
This should be both terrifying and exciting because of the implications when it comes to raising venture capital.
Relationships are currency and investors don’t want to burn them. So if you think about a typical VC who might do 6-10 deals in a year, they have to make sure the top 2 or 3 are the ones that get the most favorable treatment from their later stage VC relationships.
This isn’t to be mean, it’s to deliver returns to the LPs.
After all, everyone has heard of Pareto’s Law. It also aligns with the whole Power Law idea that drives investors.
Graph credit to Latitud
So when I saw this tweet it hit on something that the founders I’ve worked with for long periods of time do so well and I want to dig into it with you today.
The Long Game
Amateurs, when it comes to fundraising, approach it like a thing they only have to do when they are running out of money.
Professionals know it’s a never-ending campaign that they must conquer.
Here’s what the differences look like in reality.
Amateur raises their seed round. They announce it on TechCrunch, LinkedIn, and Twitter. Investors reach out and want to get to know the founder. Some will take those meetings initially and others will say thanks but no thanks for now.
Doesn’t matter which approach the founder takes in this case because the end result is exactly the same. After the first month of they hype cycle the founder has gone heads down in the company and put fundraising into the back of the dusty old closet until next time comes.
This founder probably sends semi-regular investor updates. Likely only when things are good. They stop building personal relationships with investors and founders because “they don’t have time.”
All of a sudden runway is getting tight so they reach out to their current investors for introductions. It’s met with a lukewarm “Sure let me take a look.”
In this example the investors aren’t incentivized to support the founder’s fundraise. There’s no trust that’s been built during this phase. Trust comes from sharing information. The good, the bad, and the ugly. It comes from asking for help early and often. It comes from opening up.
Now, you also need to frame things correctly and manage the flow of information the right way. This is what strategic communication is all about. Strategy is a long game.
I remember back in college when I first saw this scene from The West Wing. I felt like my eyes had just been opened and this concept of “seeing the whole board” is something I think about more often than is healthy.
Now on the other hand the professional raises their round. Let’s call it a series A.
They immediately build out a CRM of every investor who reaches out post announcement. Then they go about setting up intro calls with them. A few every week.
Then they go out and identify targets for their series B. Even though that might be 16-24 months away. They start reaching out letting these investors know they just raised their series A with participation from investor x, y, and z. They simply ask “worth getting to know each other?”
From there they send a detailed investor update every single month. On the same day of the month no matter what happens. They give data, metrics, goals, ask for help, and they share stories of what has happened and where they are going.
They don’t get complacent. They work on evolving the story to frame it properly for the next round. They build out alternative stories for different types of investors. A story for impact. A story for financial. A story for the combination.
These are the founders who never stop preparing and never stop building the next campaign.
It’s a bit like Alexander the Great. He conquered Greece and everyone thought he would stop. He could call it a day and still go down as an amazing leader.
But as soon as he conquered Greece, he was planning to conquer the entire Aegean. That’s exactly what he did. When he conquered the Aegean his friends and soldiers thought surely that was enough and he would retire to live lavishly. He did not.
He was planning to take down the entire Persian Empire. When he first defeated the Persian King Darius III everyone thought that would be enough. Instead he immediately started preparing to conquer all of Persia. That’s ultimately what he did.
That’s how professionals approach this process.
But I want to give you a way to think about how to communicate that story with investors to keep them engaged. I want you to be one of the companies that your investors are enthusiastic about and want to share with later stage investors.
What is——> What could be
This format first came out when Nancy Duarte talked about it in her legendary Ted Talk. Nancy stumbled across this idea when studying screenwriting, mythology, and great speeches. There was a common structure among the most influential speeches across history.
MLK used it and so did Steve Jobs. Plenty of others, both good and bad, have followed the same format.
It’s the what is versus what could be structure.
When you are keeping investors updated you need to be sharing what is. The things you’re currently doing in the company. The stories from customers. The stories from your team.
All of these are the what is. Current day.
To keep investors excited, engaged, and enthusiastic you need to share the what could be.
This looks similar to what I’ve talked about with emotional storytelling and the future vision story. You need to be able to paint the what could be both in micro and macro terms.
It’s that tension between the two that keeps people’s attention. Storytelling is all about tension and release. Tension and release.
Just like the best music.
Your job as a founder is to tell the best damn story of your life every single day of your life. To show up like it’s the most important story you will ever tell, every single time.
Because that’s what you signed up for.
Right now you might be wondering how your story ends. You might be thinking that this sounds overwhelming and perhaps even a bit intimidating. I get that. Everyone feels that way before they make it.
When you turn the potential inside of you into the storytelling maestro you can be and combine it with the professional’s approach to fundraising, you can and will make your vision come true.
You will be the winner of the power law. You will be that shining example.
You will be the founder that conquered your industry.
Looking for the playbook to raise your first round of capital? Check it out here.
Wanting to work directly with me? Reach out here.
A former trial lawyer and prosecutor in Dallas, TX, Robbie trains founders to become world-class storytellers and venture capital fundraisers.
In barely two years, he's helped founders raise $575,000,000 of venture capital.