It is well known that divorcing your wife or husband is much easier than divorcing your investor!
If you found raising a Series A hard, securing your Series B doesn’t get any easier. While Series A investors expect founders to show evidence that their product has true potential, Series B investors are looking for an acceleration of motion, a proven track record of milestones and a stack of metrics showing impressive growth.
And the numbers don’t hide from this truth. According to Dealroom data, only half of the 200 European companies who secured Series A funding in Q3 2020 managed to raise their next round, with 107 rounds reported.
By definition, Series B funding is the third wave of investment that a start-up can raise. These start-ups have generally discovered its product and market fit and have accomplished specific milestones in its development. While it is arguably less of a risk for investors compared to a Series A due to having tangible performance and revenue metrics to review, a lot more money is at stake to ensure the company is scalable and viable. Ultimately, a Series B round is about capitalising on proven momentum and gaining further confidence that your business will continue to be a strong, fast-growing, and profitable investment for the VCs participating.
If you are in this position looking for your Series B raise, do not fret! Despite the hurdles, there are many ways to improve the chances of securing a new injection for growth. To help founders organize, prepare and give them every chance of success, we detailed all the ins and outs of the entire funding process in this everything-you-need-to-know, compact but comprehensive manual.
Specifically, the report focuses on:
- What is a Series B round
- A glance at VC investment into ClimateTech
- When to raise a Series B
- What groundwork needs to be laid
- Pre-emptive offers
- What investment materials to prepare
- What to look out for in this funds term sheet
- How to choose the right investors
- What happens next