In this 5th session of the Brighteye Edtech Startup Festival 2024, we addressed “How to fundraise and what are we looking for?” Through 2 Founder x Investor conversations, we discussed round preparation and conviction, learning from founders and investors who have recently closed deals together.
Speakers:
Nico de Luis COO & Co-Founder @ Shakers X David Guérin Principal @ Brighteye
Anders Rapp COO & Co-Founder @ Keenious X Helen Agering Partner @ Spintop Ventures
Check out the key takeaways and a full write-up of the session below, and the recording can be watched here:
Key Takeaways:
Fundraising can be lonely: Having support from your co-founders or team during fundraising can help you stay positive, especially when investor feedback is mixed
Build relationships with investors: Go beyond the pitch deck — getting to know investors personally builds trust and can lead to more successful partnerships
Don’t wait for perfection: Timing is key. Don’t delay raising just to perfect your metrics — if your startup needs funding, start the process
Find the right investors: Target investors who understand your business model and industry to increase your chances of success
Practice pitching: Talk to less crucial investors first to refine your pitch, so you’re better prepared for key meetings
Be transparent: Investors appreciate honesty about your strengths and weaknesses — it helps build trust
The full write-up:
Funding is a crucial part of every founder’s startup experience. Whether it’s to make your initial idea come to life, to help expand your business early into its inception, or to help it grow further along the line, almost all founders will eventually need funding. Oftentimes, however, it can be difficult to know when to ask for this financial support, let alone who to ask! And then comes the issue of properly conveying your vision, along with figuring out how to show investors that your business is worth taking a chance on.
In this session, we invited three special guests to discuss the ins and outs of funding: Nico de Luis, co-founder and COO of Shakers (A Brighteye portfolio company) in conversation with David Guérin, our principal here at Brighteye and Helen Agering, Partner at Spintop Ventures and Anders Rapp, co-founder and COO at Keenious (A Spintop portfolio company), in a conversation led by Hege Tollerud, our Head of Community.
Here are summaries of each of the conversations:
Shakers
About Nico
Nico de Luis is the COO and one of four co-founders at Shakers, a Madrid-based startup which aims to facilitate collaboration between companies and freelancers. Nico was previously CEO of a mobility startup which went bankrupt, and he cites this experience as having had a serious impact on his approach to entrepreneurship – he went through the bankruptcy process in 14 different markets and learned many lessons which he brings with him to Shakers. He has also spent some time in the corporate world, mostly working on scaling up business operations in new markets and M&A.
Co-founding a Startup
Nico shared some insight into what it’s like to fundraise as one of four co-founders. The main advantage of being a part of such a large founding team, in his view, is the ability to dedicate lots of time to raising, whilst the business remains operational in that time. Recently, he led a round of funding with Hector Mata (CEO) while the other two founders stayed back to run the company in their absence. Similarly, Nico cited having support in the funding process as being very important to him, highlighting how lonely raising can be – founders often face mixed signals from potential investors. Oftentimes, meetings which seemingly go well turn into a rejection, leaving executives wondering if they’re going crazy. Having someone confirm that the meeting was actually positive relieves stress and makes it easier to perform at your best and maintain optimism throughout the harsh fundraising process.
Pitching and Investor Relations
Nico is a strong believer in the importance of relationships in getting investors to believe in a project. For him, it is crucial to meet in person in settings less formal and less restrictive than business meetings and Zoom calls. This way, founders and investors can truly get to know each other, familiarise themselves with each other’s intentions, and hopefully build trust which can translate into an investment and successful partnership. It is important not to approach these discussions too robotically, as simply providing investors with a deck, pre-planned speech and some metrics kills the natural flow of conversation, and fails to achieve the level of mutual understanding required to jointly run a business. And, once these relationships have been formed, they must be maintained – Nico estimates spending around 2 hours per week just on staying in touch with investors, whether this be through providing them with small updates, or simply chatting to them about their personal lives.
Knowing When to Raise, and Who From
Another important part of the discussion related to the practical considerations around funding: when do you raise, and which investors do you go to?
As for timing, Nico’s experience is that it can be tempting to wait a long time for all metrics to be perfect before engaging with the funding process. However, it is important not to wait too long – if the business needs funding, there is little value in delaying, only to be unnecessarily harsh on certain metrics which matter to investors. Your startup’s performance will never be perfect, so there is no use in waiting for the stars to align.
When it comes to finding the right investors, the VCs you should approach should be tailored to your startup’s particular business model and vertical. Nico recalls many frustrating conversations earlier in Shaker’s inception, in which he exchanged with many investors who were interested in B2B SaaS startups but weren’t as fussed about job marketplaces. Even generalists didn’t seem to fully believe in the founders’ particular vision for Shakers. However, once they met “marketplace believers”, they encountered more success and felt that the investors they talked to were overall a better fit for the company. Nico also emphasised the importance of asking investors questions, as founders must understand what investors are looking to get from the company, what metrics they’re focused on, and what targets they would like them to achieve – this allows clearer communication down the line and allows founders to concentrate their efforts in the right areas.
Keenious + Spintop
About Anders and Helen
Anders Rapp co-founded Keenious with Frode Opdahl when the pair were writing their Master’s thesis at the Arctic University in Norway. During this time, they often struggled to find academic papers to cite relating to their research interests, and this led to the development of the first version of Keenious, a research tool which provides AI-based article recommendations. Today, Anders is the COO of Keenious, with the company having received funding from entities such as the Research Council of Norway, the European Union and Spintop Ventures, where he met Helen Agering. Helen was CEO of a consultancy firm specialising in revenue growth before becoming a Partner at Spintop, which specialises in early-stage soft-tech startups with a clear social impact.
Preparing for Keenious’ Seed Funding
When discussing his approach to preparing for Keenious’ latest round of funding (Seed), Anders touched on a few points.
First, he discussed the relationships the founders had built and the role these played in the funding process. Some of these relationships were developed thanks to angel investors, who introduced Anders and Frode to key contacts in the VC world such as Spintop, with whom one angel investor had previous positive experience. Other relationships were built over time, from the pre-seed stage – early on, the co-founders had talked to various later-stage investors to understand what they were looking for and used these expectations as performance targets for Keenious.
Second, he mentioned the importance of practising the pitching process before talking to the most important investors. While this may sound crude, Anders and Nico agreed that startups should talk to less promising investors with whom they are less interested first, to expose them to questions they’ve not yet heard and to conversations they may be uncomfortable having. Carrying this experience forward makes founders more prepared when it comes time to pitch for the investors they really care about – Anders cites this method as having helped Keenious secure funding from Spintop, with whom they talked after some “trial-runs” with other VCs.
Funding from the Spintop VC Perspective
Spintop’s investment team is comprised of 8 people who look at around 1000 companies every year, only for the fund to invest in around 10. Standout opportunities are brought to the weekly meeting, where colleagues at all levels get input and decide whether they’re worth pursuing. If startups make it through this process, deeper analysis is conducted, both relating to the company’s financials and to other relevant metrics – for instance, customer interviews may be conducted, and a few meetings are scheduled with the founders to get a better understanding of their personalities and their vision for the company. This process shows the extent to which finding the right investor, and convincing them to invest, is not just a question of assembling the right deck and preparing a good presentation – startups should focus on building the best business they can before tending to the way their company looks from the outside.
During the discussion, Helen also mentioned what stood out about Keenious relative to other companies she had talked to. On one hand, she pointed to the team as seeming particularly trustworthy – they came across as very easy to work with and were clearly obsessed by the problem Keenious was set out to solve. She also noted the team’s willingness to get senior advisors on board early on, and to implement their advice, showing their desire to learn and work with others. Similarly, when communicating with her, they were forthcoming about their strengths and weaknesses, conveying the kind of honesty which builds a good level of trust with investors. Finally, their idea solves a real, large-scale problem which impacts a large market (higher education) and has a clear go-to-market strategy.
Life After Funding
Having talked extensively about the actual funding process, Helen and Anders also discussed what funding meant for Keenious now that it had been secured. Anders mentioned that the company had yet to set up a board, and that this was a clear priority for the founders, along with aligning on the next steps and making clear plans. In terms of specific objectives, Keenious is looking for new and better ways to measure the ROI of their product, and would also like to scale up the commercial side of the business.
From Spintop’s perspective, Helen mentioned that the VC would take up an active role in Keenious as one of their portfolio companies, and that it intended on having at least one board role within the organisation. Spintop also plans on spending more time with the Keenious team, building trust, making relevant introductions, and providing operational support.
And that concludes our session with Nico, Anders and Helen, all of whom provided an excellent overview of the funding process from different perspectives.
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