Learn how to create a timeline for your seed or Series A fundraise

1. Fundraising Guide for Early Stage Startups
Scott Sage
EIR
Seedcamp
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2. This is for
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• Founders raising a seed or Series A round from VC’s
• Not for –
• founders who will be running a rolling close with
their seed round via a convertible or
• later stage company founders where the diligence
process can take longer (ie Series B+)

3. Typical lifecycle of closing a round
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 Intro to a VC
 1st Pitch
 If excited – VC leans into a deal
 If not, passes or goes cold
 Likely 2-4 more meetings with other members of the team
 Full partner pitch
 Final DD / Termsheet
 Transaction execution
 $ wired and huge relief

4. 3 phases
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1. Be Ready
All about Prep
2. Start
Execute
Termsheet
3. Close
Company readiness
Story/deck
Rehearsal
Company Strat/plan
Numbers
Traction
Fundraising Plan
Targeting (fit)
Intro’s
Drive the process
*Ultimate
Goal
$
(1-6 months) (3-4 months) (1 month)
Actual fundraising (ie 1st meeting to
completing legals) should take c12 weeks

5. It’s about time
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• From first meeting to $ in the bank my personal goal as a
VC is to have the deal done in under 3 months
• First mtg to partner meeting to final diligence and
termsheet should take somewhere between 3-8
weeks and legals/deal execution should take 2-3
weeks.
• Any longer and you get lazy and time slips
• Keeping pressure on both sides to get to completion
means the founder can get back to running the co

6. VC is looking at
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TractionPlanTeamMarketProduct
Whether users love
the product and are
highly engaged?
If product has
technical defensive
barriers?
Is there at least one
highly technical
person on the
team?
Do they have
domain expertise?
Will they be able to
recruit and retain
the best talent?
Will this be a multi-
billion dollar market
in 5-10 year’s time?
What are you
competing with
currently?
What are the clear
objectives over the
next 1, 3 and 6
months?
How will they use
this money?
What does the
company need to
achieve to raise
their next round at
an increased
valuation?
Do they know their
most important
metrics?
Does retention look
good?
Are they growing
organically or
acquiring customers
with a positive
margin?
Is growth
sustainable?

7. 7
Ideal timeline

8. Most time wasted here
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9. Be upfront about your process
“I’m glad you understand and like what we are doing and we
would love to continue the process with [insert fund]. Just to let
you know our timeframe, I’m holding first meetings this week
with the usual suspects and we are optimistic that we’ll have a
termsheet by x week of September. Does this fit with your own
timeframe? Could you please walk me through your process?”
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10. Checklist
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 Well designed fundraising deck with the relevant content
 Rehearsed story
 Plan for the next 18 months with a budget
 Other diligence materials ready to be shared in Dropbox
 Confirmed intro’s lined up from friends to investors
 Fundraising plan / timeline

11. Appendix
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12. Sample due diligence list for a SaaS-Co
1. Customer reference calls x 5 (ideally from different verticals)
2. Financial model
a. Historical + Forecast of next 2 years
b. Use of proceeds of the $7m including hiring plan, sales and marketing costs, int’l expansion thoughts
3. Seed Termsheet
4. Current Cap Table
5. Sales Model / Metrics
a. Existing pipeline coverage for existing quarter and next quarter
b. Number of sales people on quota historically (probably not many at this stage!)
c. Ramp up time for sales people (probably still a guestimate!)
d. Funnel metrics + sales cycle
e. CLTV (another total guestimate!)
f. CAC Ratio (somewhat erroneous at this stage as your spend / revenue is all over the place)
g. Revenue and customer Churn / reasons (very important to understand this)
6. Marketing metrics
a. Inbound leads, MQL’s per source, cost assumptions for net 18 months
7. Product / Competition
a. In-depth analysis of product compared to competitors
b. Technical review
c. How have they won customers away from the comp?
d. Roadmap
8. GTM Strategy / Partnerships strategy
9. Time with rest of the team
a. Informal interviews with all senior execs onsite to also check out your offices
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