FEATURES
Now I Know My A, B, Seeds As the global startup ecosystem brings in more capital, navigating the market is becoming increasingly challenging for new founders. To help demystify the fundraising process for aspiring entrepreneurs, three founders share valuable insights drawn from their own experiences of raising Seed, Series A, and Series B funding. By KHADIJA AZHAR
SEED Band P r otoc ol
“If you are a firsttime founder without much experience, then build a prototype to show how you are solving a real problem, with numbers to prove traction and application.”
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ith product blueprints finalized and potential market fit researched, startups that intend to move beyond ideation raise a Seed round of funding. Mainly led by angel investors, these rounds pave the way for future revenue growth. In February 2019, Band Protocol, a Singapore and Thailand-based startup that focuses on decentralizing data curation, raised US$3 million in Seed funding led by Sequoia India. The company’s CEO and Co-founder Soravis Srinawakoonis delineates how founders should approach Seed rounds based on his recent involvement in fundraising circles. What did you look for in potential investors for your Seed round? We looked for strategic partners who can contribute beyond just funding, so we opted for traditional venture funds over cryptocurrency funds. Traditional venture funds, such as Sequoia India, tend to be more hands-on and can help us with marketing, finances, legal, etc. Since our product is B2B-driven, having investors with that experience and the right connections to potential partners is extremely helpful, especially for a young startup. Did you consider raising a pre-Seed or taking part in an acceleration program? We wanted to be laser-focused on product development. It was a conscious choice to bootstrap the startup, which ensured full commitment from all co-founders. It allowed us to be lean without having to worry about pre-Seed or an acceleration April 2019
program, which would have taken away our time and resources. In your experience, what do investors value the most for Seed funding? If you are in an early, pre-product stage like us, the team is what investors value the most. As a young startup, we will have to inevitably pivot, and it will take a few iterations to get to the right product-market fit. What remains is the team. If you can execute and work well together, the original ideas or early revenue figures don’t matter as much. What was the biggest challenge you faced during the fundraising process? We raised funding in what was probably the worst bear market in the history of the blockchain. The global cryptocurrency market has been slow to recover ever since its dramatic fall last year. We overcame this with tenacity and perseverance, pitching to over 50 investors–giving them detailed valuations and projections on potential market sizes–to convince them that this is the right sector and right time for them to invest. What advice would you give startups looking to raise a Seed round? Have a clear vision of the problem you are solving and make sure you assemble a team that can execute. If you are a firsttime founder without much experience, then build a prototype to show how you are solving a real problem, with numbers to prove traction and application. JUMPSTART MAGAZINE
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