Fundraising in a turbulent economy: key takeaways from webinar

In today’s unpredictable economic landscape, securing funding can be more challenging than ever for startup founders. To address these concerns, Dealum hosted a webinar for founders featuring Alexandra Balkova, an early-stage investor, adviser, and Head of Portfolio at Startup Wise Guys, working with over 450 international startups across 7 different verticals.

Understanding the current economic climate

Alexandra Balkova highlighted that the number of deals and overall investment volumes have been declining since early 2022. Despite a slight increase in funding volume in early 2024, the number of deals continues to drop, indicating a highly competitive environment for startups.

Venture capitalists (VCs) are also experiencing fundraising challenges. Just as startups seek investments from VCs, VCs raise funds from limited partners (LPs). With decreased liquidity and a challenging exit market, VCs are reallocating capital and conducting more thorough due diligence. This longer decision-making process impacts how and when startups can secure funding.

Strategies for founders

Alexandra shared several key strategies for founders to improve their chances of fundraising success:

1. Start early: The best time to start fundraising was yesterday; the second-best time is today. Preparing in advance and understanding the market cycles can make a significant difference.
2. Build a robust investor pipeline: Creating a comprehensive list of 100-400 relevant investors is crucial. These should be investors who are a good fit for your stage, industry, and geographic focus.
3. Prepare thoroughly: Having all necessary documents ready in a data room can speed up the process. This includes financial projections, market analysis, legal agreements, and more.
4. Align on Q&A: Ensuring that all founders are aligned on the company’s vision, mission, and key answers to common investor questions is vital for a coherent and compelling pitch.
5. Focus on customers: Ultimately, traction with customers is the most important factor. Demonstrating strong customer relationships and revenue growth can make your startup more attractive to investors.
6. Share regular investor updates: Send monthly updates to your investor pipeline to stand out and maintain engagement.

Utilizing the summer downtime

Despite the slowdown in investor activity during the summer months, Alexandra advised that this period can be used effectively for preparation. Founders should focus on:

• Researching and building their investor pipeline;
• Preparing detailed documentation and building a data room;
• Aligning the team on key questions and motivations;
• Growing customer traction and developing the product.

For those who missed the live session, the full video is available below. Watch to gain deeper insights and practical tips from Alexandra Balkova and learn how to position your startup for successful fundraising in today’s economy.