Roads are rarely as long and winding as the ones that lead to Series A investment – especially right now. Such is the nature of hitting ‘maturity milestones’ of product market fit and commercial traction, life post-Seed rounds is all about scale. And convincing funds to part with the bigger cheques at your desired valuation can take some turns.
That’s why the Series A journey was the focus of our second FieldHouse BaseCamp event this year. It was a chance for BaseCamp members and other founders to meet the investors who have travelled with hundreds of startups breaking into the alphabet of funding rounds. And like all event nights at FieldHouse’s offices, it was an evening full of networking, drinks (soft ones too), pizza, and insightful discussion.
During this ‘Meet the Investors’ session, three investors shared their first-hand experiences of the early-stage investment process. Louis Fearn, Principal at InMotion Ventures; Sarah Barber, CEO of Jenson Funding; and Manuel Antunes, Investment Manager at Triple Point Ventures formed the panel to discuss their key learnings on the Series A fundraising process and securing investment as an early stage company.
Here’s a quick recap of what was covered:
Louis Fearn, Principal at InMotion Ventures (the corporate venture capital arm of JLR)
InMotion Ventures has been more active this year than ever before, having announced five new investments in the past seven months alone. As InMotion’s climatech specialist, Louis drew attention to three features he looks for in a startup before investing: sustainability, scalability and profitability.
Louis also advised founders that they should aim to have enough capital for 24 months, not 18. It’s important to hit the ground running, so start the process early and continue to plan ahead. Equally, InMotion helps founders foster relationships with other potential investors through introductions. So attend events, utilise Board members and make good connections.
As a final point, Louis set out three important milestones to hit at Series A:
- A gross margin of 50% or more.
- Stable customer relationships.
- A clear roadmap to hitting one hundred million customers.
Sarah Barber, CEO of Jenson Funding Partners
Sarah highlighted that while every journey to Series A is different, there are some recurring features of a successful funding process.
Portfolio companies are always fundraising. Investment must be sought out and driven by something, rather than assuming that investment will keep flowing simply because of your level of revenue. This is when a common theme emerged – similarly to Louis, Sarah also noted the importance of relationship building and keeping in constant contact with investors to secure this funding, for which timing is key. By establishing strong connections with investors, founders can build awareness of not just what investors are looking for but also when. To do all this, portfolio companies must have a plan and be ready to move forward.
Manuel Antunes, Investment Manager at Triple Point Ventures
Manuel shared some of the characteristics he looks for in a potential investment. Triple Point Ventures has also had a busy year thus far, with three new investments already publicly announced and others set to be announced in due course.
Triple Point Ventures is particularly interested in tech that can help with the infrastructure aspect of energy transition – once again, sustainability is central. If the investment opportunity is new and exciting, it is much more likely to get funded quickly. Additionally, Manuel underscored the importance of considering when to enter a company into the market: founders should ask themselves ‘is the market ready for this company right now, or would it be better suited for two or three years down the line?’. Questioning this is a surefire way to increase the chances of securing investment. A final and cautionary piece of advice is to not overspend too early. Consider the key performance indicators and use this to inform decisions regarding expansion.
Three different perspectives on how best to approach the funding process pre-Series A, but one resounding piece of advice is clear: plan ahead.
Thank you to all three investors for their great contributions to the panel discussion and to everyone who joined us for the event.
