What it takes to raise a Seed

Surbhi Rathore, CEO and Co-Founder, Rammer.ai

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Seed round short Q&A

Last May I featured Surbhi Rathore's perspective on her company's participation in the 2019 Techstars Seattle accelerator program. Three and a half months later, Surbhi and the Rammer.ai team closed a $1.8 million Seed round. Here are key takeaways from her fundraising journey. 

How many investors did you pitch (approximately) to close the round? 

We ended up having meetings with less than 30 or so investors. We were very targeted in the approach of only reaching out to the firms with some investment thesis around Enterprise AI or platforms. And it was a pleasure to get connected with each of them. 

What about your company's story changed or evolved as you pitched? What narrative worked best? 

Every meeting was a new learning experience that gave us further clarity on handing the objections. One of the things I learned was making sure we communicate the vision in the right proportion to what exactly we are doing near-term. I would say in the end it was the strength of the founding team, the founder's insights in the market and what hypothesis we are validating, with a clear understanding of how we will get to the next stage. 

How will you use the proceeds? 

With this Seed round we will expand the engineering and data science teams to scale the platform and make it easy for developers to adopt this technology. We are also investing in business fundamentals to grow, acquire, and delight both customers and partners.

What people or groups were most helpful throughout the fundraising process, and how? 

Techstars helped us immensely with the support system and access we needed to the right investors. Not just the entire Techstars team, but the alums from previous batches and mentors helped us with introductions and sharing the knowledge of what worked for them. It's always faster to learn from others' experiences and apply to your own journey. 

Anyone you want to give a special shoutout? 

Chris DeVore, Aviel Ginzburg and all our mentors during the Techstars program. Our entire team in India who stepped up to take more responsibilities as I (alongside Toshish Jawale, my co-founder) went through our first fundraise process. We are so excited to unfold the next phase.

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What is a Seed round?

Here's an overview from Investopedia's Series A, B, C Funding: How It Works...

Seed funding is the first official equity funding stage* and typically represents the first money that a business raises. Some companies never extend beyond Seed funding into Series A rounds or beyond.

You can think of the "seed" funding as part of an analogy for planting a tree. This early financial support is ideally the "seed" which will help to grow the business. Given enough revenue and a successful business strategy, as well as the perseverance and dedication of the founders and investors, the company will hopefully grow into a "tree."

Seed funding helps a company to finance its first steps, including things like:

• Market research and product development to dial in product-market fit

• Hiring a founding team, or expanding the team  

*I'm seeing more Pre-Seed rounds pop up on Crunchbase (there are two listed below in this week's update). Funding for a Pre-Seed business normally comes from the 3F’s (Friends, Family and Fans). The amount of money is usually small (under $1 million) because the business is still in the idea or conceptual stage. That said, both of this weeks's Pre-Seeds are $1 million and above (Airspace Link, $1 million; Kensho, $1.3 million). 

Investors, I'd love your insight on the Pre-Seed trend. Contact me.

Updated Female Founder Spreadsheet

This is Flo Freely, the code name for the new and improved Underwire Female Founder Funding Update. Access the full spreadsheet here.

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Crazy, sexy, cool data

Mama's been giving her spreadsheet some TLC.

I spent the past two weeks revamping the Underwire Female Founder Fundings Update. Yeah, the name's a mouthful. But that bitch is SEO'd up. Just between you and me, I call it Flo Freely in honor of Margaret Jane Swendsen's alter ego, and the hope that one day funding will flow freely and equally to womankind.

I never thought I'd enjoy working a spreadsheet so much. Pffftt, yes, Sarah Bryar, I really just said that.

So what's up with Flo?

You can now access year-to-date funding and exit details for U.S. headquartered companies with at least one female, non-binary, bigender, gender fluid, gender-nonconforming, or transgender female founder.

For ease of weekly reporting, I made an executive decision to focus on:

• Crunchbase as my primary data source; Crunchbase gets its data from AI and machine learning, a venture network program, investor and founder contributors, third-party partnerships and in-house data analysts

• Additions from Fortune Term Sheet, as well as investor and founder word of mouth for deals that don't show up on Crunchbase (happens very rarely)

• U.S. only companies (for now)

• Filings for Pre-Seed, Seed, all Series rounds, Venture - Series Unknown, Angel, Private Equity, Debt Financing, Convertible Note, Crowdfunding, and Initial Coin Offerings.

At the bottom of each future newsletter I'll cover filings reported from Friday to Friday of the previous week. Details will include:

• Company name and industry

• Founder(s) name and title

• Last funding round and type of deal

• Number of funding rounds total

• Top 5 investors

• Links to their website and Crunchbase profile

• Notable insights about a founder, investor, or category.

Finally, one big change to save my sanity: the weekly summary will only be available in the newsletter. The easiest way to stay current on female fundings is to subscribe to the Underwire newsletter (it’s an irreverent doozy).

Click here to see the full year-to-date Underwire Female Founder Update.

Tips encouraged

Contact Underwire if you’re a founder or investor with a funding tip to share. In addition to inclusion in the YTD update, I’ll feature your company info in an upcoming newsletter.

Summer Female Founder Funding Update

Welcome to Underwire’s female founder funding update. We track this information to combat the negativity around women-led venture funding (yes, it still hovers around 3%). We know that it can feel self-defeating to read about companies getting funded when you’re not. Still, this is important to track. This page is proof that women are building and scaling incredible companies. Dream big, dammit!

We cover mostly venture capital updates and exits. We source our updates from Fortune’s Term Sheet newsletter (edited by Polina Marinova), Crunchbase, GeekWire and tips from local investors and founders.

Here is the Underwire Funding Update spreadsheet with a year to date (to the best of our knowledge) summary of fundings, including founder names and titles, industry, investors and diversity info. This is a labor of love from a person that dislikes spreadsheets, so be nice. Better yet, contact us if you have info to share or want to make improvements.

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Funding

Genneve, $4 million, Seed, Jill Angelo, Founder & CEO
Seattle-based digital health platform for women in midlife. BlueRun Ventures led the round, joined by StartupHealth and Maven. (Website, Crunchbase)

Herbivore Botanicals, $15 million, Series A, Julia Willis, Co-Founder, Co-CEO and CCO
Seattle-based clean beauty brand. Silas Capital led the round, joined by Stage 1. (Website, Crunchbase)

Figure8, $40 million, Series A, Maryellis Bunn, Co-Founder
New York-based brand marketing firm and creator of the Museum of Ice Cream. Lead investors include Elizabeth Street Ventures and Maywic Select Investments, joined by OCV Partners. (Website, Crunchbase)

Hipcamp, $45 million, Series B, Alyssa Ravasio, Founder and CEO
San Francisco-based outdoor recreation content platform. Round led by Andreesen Horowitz, joined by Jay Z (Marcy Venture Partners) and Will Smith (Dreamers Fund). (Website, Crunchbase)

Weekly Female Founder Funding Update

Welcome to Underwire’s weekly female founder funding update. We track this information to combat the negativity around women-led venture funding (yes, it still hovers around 3%). We know that it can feel self-defeating to read about companies getting funded when you’re not. Still, this is important to track. This page is proof that women are building and scaling incredible companies. Dream big, dammit!

We cover mostly venture capital updates and exits. We source our updates from Fortune’s Term Sheet newsletter (edited by Polina Marinova), Crunchbase and GeekWire.

Here is the Underwire Funding Update spreadsheet with a year to date (to the best of our knowledge) summary of fundings, including founder names and titles, industry, investors and diversity info. This is a labor of love from a person that dislikes spreadsheets, so be nice. Better yet, contact us if you have info to share or want to make improvements.

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Funding

Anomalie, $13.6 million, Series A, Leslie Voorhees, Co-Founder & CEO
San Francisco-based custom wedding gown company. Goodwater Capital led the round, joined by investors including Signia, SoGal Ventures, Lerer Hippeau’s BN Capital Fund, and Fin’s Sam Lessin. (Website, Crunchbase)

Chief, $22 million, Series A, Carolyn Childers and Lindsay Kaplan, Co-Founder and CEO and Co-Founder, respectively
New York-based private network of women. General Catalyst and Inspired Capital co-led the round. (Website, Crunchbase)

DotLab, $10 million, Series A, Heather Bowerman, Founder and CEO
San Francisco-based personalized medicine company for women’s health. CooperSurgical led the round, joined by investors including Tiger Global Management and Luxor Capital Group. (Website, Crunchbase)

Genome Medical, $23 million, Series B, Lisa Alderson, Co-Founder and CEO
Monterey-CA network of genomics services experts using telemedicine to integrate genomic insights into everyday health care. The latest financing was led by Echo Health Ventures, a collaboration between Cambia Health Solutions and Mosaic Health Solutions. Other backers included LRVHealth, Casdin Capital, Perceptive Advisors, Manatt Venture Fund and Dreamers Fund. Thanks for Kristine Ashcraft, CEO of YouScript for the tip.(Website, Crunchbase)

Homeroom, $3.5 million, Seed, Casandra Espinoza Stewart, Co-founder & CEO
San Francisco-based platform for after-school enrichment programs. Forerunner Ventures led the round, joined by Felicis, Precursor, and Kapor Capital. (Website, Crunchbase)

Miss Grass, $4 million, Seed, Kate Miller, Co-founder and CEO
Venice, Calif.-based cannabis brand with a content and e-commerce platform. Investors include Listen Ventures, Casa Verde Capital, Advancit Capital , firstminute capital, Third Kind Venture Capital, and Muse Capital’s Assia Grazioli-Venier and Rachel Springate. (Website, no Crunchbase listing)

Remedy, $10 million, Series A, Christina Gabrysch, Co-Founder
Austin, Texas-based provider of healthcare services. Sante Ventures led the round. (Website, Crunchbase)

Exit

SheWorx, Undisclosed, acquired by Republic, Lisa Wang, Founder
New York-based platform and event series for female entrepreneurs. Financial terms weren’t disclosed. (Website, Crunchbase, article on Republic’s blog)

New Fund

Vice Ventures, $25M fund to back sinful sectors, led by founding partner, Catharine Dockery. (Website, Crunchbase)

Weekly Female Founder Funding Update

Welcome to Underwire’s weekly female founder funding update. We track this information to combat the negativity around women-led venture funding (yes, it still hovers around 3%). We know that it can feel self-defeating to read about the companies that are getting funded when you’re not. Still, this is important to track. This page is proof that women are building and scaling incredible companies. Dream big, dammit!

We cover mostly venture capital updates and exits. We source our updates from Fortune’s Term Sheet newsletter (edited by Polina Marinova), Crunchbase and GeekWire.

Here is the Underwire Funding Update spreadsheet with a year to date (to the best of our knowledge) summary of fundings, including founder names and titles, industry, investors and diversity info. This is a labor of love from a person that dislikes spreadsheets, so be nice. Better yet, contact us if you have info to share or want to make improvements.

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Athena Security, $5.5 million, Seed, Lisa Falzone, CEO & Co-Founder
Austin-based AI security camera startup. Pathfinder led the round. (Website, Crunchbase)

Kango, $3.6 million, Series A, Sara Schaer, Co-Founder & CEO
San Francisco-based ridesharing for kids. National Express led the round. (Website, Crunchbase)

Mixlab, $8.5 million, Seed, Stella Kim, Founder and CXO
New York-based pet pharmacy. Global Founders Capital led the round, joined by Monogram Capital, Brand Foundry, Lakehouse Ventures, Mars Petcare, Joyance Partners, and TQ Ventures. (Website, Crunchbase)

Needslist, $1 million, Venture, Natasha Freidus, Founder
Philadelphia-based online platform that matches products and services to communities in need. Investors include Amplio Ventures, Marigold Capital, Omidyar Network, Next Wave Impact, Silicon Valley Social Ventures and the Kuo Sharper Fund. (Website, Crunchbase)

Novi, $3 million, Seed, Shannon Mosier, Co-Founder and COO
San Francisco-based company focused on improving financial literacy. Investors include Runa Capital, Lightspeed, Doberman Forward, Freedom Financial Network, M ventures, SGH Capital, Republic.co and Vectr. (Website, Crunchbase)

Part & Parcel, $4 million, Seed, Lauren Haber Jones, CEO and Founder
San Francisco-based community commerce platform for plus-size women, selling apparel and footwear. Lightspeed Venture Partners led the round, joined by Village Global and Peterson Ventures. (Website, Crunchbase)

Exit:

TheRealReal, IPO, Julie Wainwright, Founder and CEO
San Francisco-based luxury reseller, plans to raise $270 million in an IPO of 15 million shares priced between $17 to $19. The firm posted revenue of $207.4 million and loss of $75.8 million. The firm is is backed by Perella Weinberg Partners (11% pre-offering), Canaan Partners (13%) and Great Hill Partners (14.7%). It plans to list on the Nasdaq as “REAL.” (Website, Crunchbase)

February Ifs

Illustrations by Blair Breitenstein / @blairz.

Hearts & Millions

I love this issue of the Ifs. Here’s why: Seven heart-centered must-reads, six fundings with over $163 million raised, and three exits (two at $100 million each). ❣️💪🏽💸

If flab has landed

Take this 3-question quiz to get your ass back. This is from Richa's article on how to grow without VC and a classic example of Frontend Bait in a customer-loving Value Ladder. 

If objectivity eludes you 

This is why thinking of your business as your baby could be stalling growth. Informed by Finnish research that confirms the emotional connection to your business mirrors your emotional connection to a child.

If buying chocolate and roses feels shallow 

Go deep this Valentine's day. Buy nothing, reinvest in the relationship and finish what you started. Raptitude did this for a year and one million people read about it.

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That orange blob is a chicken wing. Delivered by a drone. There’s a model for that, mockumentaried in the Crunchbase series "A Startup Takes Flight.”

If confused by funding lingo

In the five-part series, "A Startup Takes Flight," Crunchbase skewers the Valley’s lust for the next-big-thing while mockumenting a fictitious company’s growth from unpriced Seed round to acquisition. Along the way, you get clear examples of the legal and insider terminology used in deal-making (cap tables, deal terms, valuations, etc.), and more importantly, the mechanisms that VCs use to protect themselves in the deal. You know what happens when they know more than you. No excuses, ladyballers.

If Snapchat's in your mix 

Here’s what it takes to put together world-class social content. A short-read overview of Vogue International's three Snapchat Discover channels, team resources required, and why they love Gen Z.

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Bianca Valenti surfing the big waves at Maverick’s in December 2018. Photo by Dina Litovsky/Redux, for The New York Times.

If in need of a Fuck Yeah!

Read this outstanding article on the push for gender equality in big wave surfing. Read it for the lesson on how to harness coalitions and small government, such as land-use commissions, to demand change. Read it for the love of great writing. Read it for the role models, as per usual, a group of supremely talented women outworking and outwitting men for the right to compete and get paid equally. The best article of the year (so far).

If your teen has lusty Qs 

Planned Parenthood's Roo chatbot answers with honesty, sensitivity and humor. Props for the gender inclusivity. This is an ingenious use of tech to reach Gen Z, their next gen of supporters.

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Funding

Remarkably, $800,000 Seed, Erina Malarkey, CEO and Co-Founder; Anna-Lea Dieringer, Chief Product Officer 

Seattle-based marketing analytics software for the real-estate industry. Round led by Pioneer Square Labs Ventures with angel investors in real estate and technology. Remarkably is the first all-women-led company to spin out of Pioneer Square Labs. (Via PSBJ)

PartySlate, $3 million Seed, Julie Roth Novack, CEO and Co-Founder

Chicago-based PartySlate is a digital platform designed for event professionals. Led by Hyde Park Venture Partners; other investors include Purple Arch Ventures, Hyde Park Angels, and InvestHER Ventures. 

Ritual, $25 million Series B, Katerina Schneider, CEO and Founder

Los Angeles-based Ritual is a direct-to-consumer vitamin company. Previous investors Founders Fund, Norwest Venture Partners and Forerunner Ventures participated. Three-quarters of Ritual's board members are women and 60 percent of its 47 full-time employees are female.

Billie, $25 million Series A, Georgina Gooley, Co-Founder

Brooklyn-based wellness company Billie sells direct-to-consumer shaving supplies and body products for women. Round led by Goldman Sachs’ Private Capital Investing Group. Silverton Partners, Female Founders Fund, and Lakehouse Ventures also participated in the round. (Fortune)

Cuyana, $30 million, Series C, Karla Gallardo, CEO and Co-Founder; Shilpa Shah, Co-Founder

San Francisco-based direct-to-consumer fashion brand focused on responsibly sourced, high-end apparel and accessories. Cuyana was profitable in 2018. Backed by private equity firm H.I.G. Capital. (Business of Fashion) 

FabFitFun, $80 million Series A, Katie Echevarria Rosen Kitchens, Co-founder, Editor in Chief  

Los Angeles-based subscription-box service for beauty and wellness products. Led by Kleiner Perkins. FabFitFun financing follows a period of hockey-stick growth for the nine-year-old company, which topped $200 million in revenue last year.

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Exits

Killer Infographics, acquired by Lieberman Research Worldwide, amount undisclosed, Amy Balliett, CEO and Founder

Seattle-based visual communication company known for stylized infographics and videos. Notably, they designed their own confidential information memorandum — CIM — for potential partners, instead of letting a brokerage firm do the work.

Read GeekWire's insightful Q&A with Amy with practical advice about bootstrapping. Hire a bookkeeper, have money in the bank before you start the company, network with the men, and this....

“For the first five years of this company, I tried to avoid conflict. I often would put emotions of other people above business needs. But then I started letting the needs of the business drive all decisions over my own emotions. I do think that’s something women aren’t taught to do or expected to do. Women are often vilified when they do that. But the fact is, when you have 25 families that rely on you for their source of income, you need to let the needs of the business drive decisions over emotion.

Ultimately, I had to learn to stop apologizing and I really had to learn to stop justifying the same decisions I’d make that a man would make. Women often have to justify logical decisions and emotionless decisions and it makes it pretty hard if you’re running a business. Women have to earn it far more.”

— Amy Balliett, CEO and Founder, Killer Infographics  

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More exits

L., acquired by P&G for ~$100 million, Talia Frankel, Founder 

San Francisco-based L. is a retailer of period products and prophylactics. Founder Talia Frenkel was a photojournalist before she started L. through Y Combinator.

Why this acquisition is important:  According to TechCrunch, “For investors with knowledge of the company, the P&G acquisition is a harbinger of things to come. The combination of a non-technical, female founder operating in the consumer-packaged goods market with a mission-driven company was an anomaly in the Silicon Valley of four years ago, but Frenkel’s success shows what kind of opportunities exist in the market…’With this acquisition investors need to update their patterns,’ said one investor with knowledge of the company.” (TechCrunch)

To that end...

The Laundress, acquired by Unilever for $100 million, Gwen Whiting and Lindsey Boyd, Co-Founders 

NYC-based The Laundress is a luxury eco-friendly home-cleaning products startup. The founders never took venture capital money and sell 85 products, from specialized detergents to dish soap. (Fast Company)