The video discusses the unique approach to pitching startup investors in the US, highlighting cultural differences and the larger capital available from US-based institutional investors, especially for later-stage funding rounds like Series B and beyond.
What this video covers
Investors in the U.S. are like the Holy Grail. It’s the best investors, the most amount of money, and you name it. Obviously, it is a different culture than you would approach an investor in Europe, or in Latin America, or in Asia.
Raising from investors in the U.S. At the end of the day, it’s bigger money. What I mean by bigger money is that the funds are bigger, especially if you go for institutional investors like private equity firms or venture capital firms.
That means that if I were to be a founder there, once I’m past a Series B financing round, then no funds there can continue to support my growth. Essentially, I would have to go to the U.S. to raise money from the bigger funds that can continue to support that growth and that have a billion+ under management in assets.
The beautiful thing about having bigger money as part of your business and as investors in your business is that as you continue to grow, they may be in a position to actually lead and cover whatever more funding that is needed for your business. That’s why having U.S. investors is a great thing, and the longer that you wait, the tougher that it will be to really get those investors involved.
U.S. investors are also “connected money.” What I mean by this is that when you think about raising money, you never should think about the money itself because there’s no such thing as a shortage of capital in the world. For this reason, you always want to turn it around and think more than the money itself, more as the network or the people that are behind the money that has been given to you.
In terms of some of the different ways that you can use to actually tap into those U.S. investors, a good way is to attend graduate school in the U.S.
Maybe you come to the U.S., and you do a Master’s Degree in whatever domain that you’re doing, whether it’s business or engineering.
Startup accelerators are a great way to also tap into those U.S. investors. Definitely, my top ones are Y Combinator and Techstars. Those are amazing programs that have fantastic networks. Also, what they do at the end of those startup accelerator programs is the Demo Day.
Startup Competitions are also another way to get in front of investors. You should find those competitions online. See what people are saying; see reviews; see what companies have graduated out of those competitions. Some competitions that come to mind could be TechCrunch Disrupt, which is the competition that they actually do for the media outlet.
There have been great companies that have come out of these startup competitions, such as Getaround, which now is worth almost billion, and other startups that actually really made it count. Even, for example, Betterment, which is worth billions, too, they actually launched at Startup Disrupt for TechCrunch. Take a look at some of those competitions because there are going to be a lot of investors there that you can tap into as well.
You can also use local offices of venture capital funds. For example, if you’re in Europe, in London, or Spain, or other areas, you’re going to find some of the top U.S. funds that actually have branches there. For example, in Asia, the same thing, or if you go to places like India, you’re going to see some of the top venture capital firms that have opened an office there.
It’s a good opportunity for you to build relationships with them locally, and maybe that will be your segue into the money in the U.S. of those investors that you want to tap into. So, again, perhaps those local branches are a good opportunity for you to really start establishing and developing those relationships.
Platforms online could be a great tool, as well, to find those investors. That could be crowdfunding platforms. That could be platforms where it’s more like the community environment, like AngelList, where you can see the signaling, and you can see who is investing in what. Those platforms online can really develop or give you the opportunity to develop those relationships that, in the end, could be sold in a potential investment.
