Ever since Newfund Capital landed in the US in 2013 via a “flip” of one of its portfolio companies, its american-ess has progressively increased : 1/3 of our investments are state-side, 15% of our LPs live in the US, 25% of the Newfund team has an american training and we have opened an office there. Combining our experiences as entrepreneurs in the US then as investors, here is a mini-guide to direct you in your thoughts of fundraising in the US.
You are an international startup and you wish to raise with seed funds based in San Francisco? To start, here are the 3 best practices to remember so you understand some key rules and avoid the easy mistakes:
- Get a warm intro: Intros are key in the US. For many funds, up to 90% of meetings come from recommendations from friends, portfolio entrepreneurs, or LPs. Cold emails aren’t viewed positively except if they are incredibly personalized.
- Fast (and Remote) Process: Like in Europe or other places of the world, you will likely go through three meetings on average before getting some indication of interest. Pre-Covid19, the first meeting was often a visio call. Now even more so. So before you buy your ticket to SF (post-travel ban), just try to get as many first Zoom meetings as you can. Also the average fundraising last up to 3 weeks on the west coast. 4 weeks and your startup is starting to look suspicious.
- US requirements: Finally, and this one is important — to validate your desires of fundraising in the US, you must have at least one of the co-founders residing there and a major part of your operations must also be located stateside. Things may change following the pandemic but we are not so sure of that. The large majority of american VC funds remain ultra-focused on the US and Canada.
Now that you know everything, here’s our map of the main Seed funds you ought to contact then visit when you’re in San Francisco. Within a perimeter of a few blocks are concentrated 75% of the main funds. All of the VCs are working from home right now, but be prepared for a change when the pandemic is over.
As a conclusion: remote or in person, be quick and punctual. If you’re 30 seconds late to a call, it’s considered unprofessional; and if you take more than 2 hours to answer an email, it’s because you’re not interested or something has happened to you. We’re barely joking! Good luck and godspeed!
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