Four tips from a VC newbie after 90 days in the startup funding world
Ninety days into the depths of Indy’s tech scene has me thinking: who nicknamed this city Naptown? Coming from a startup in Chicago, I had the “work fast” part down. Little did I know that was a mere third of what you needed to be equipped with to jump into the startup and funding scene of Circle City (better nickname). Even if I could have predicted what laid ahead of me when I took on my role at High Alpha, I don’t think I could have prepared for the nuanced world that is venture studios and startup funding.
If you’re going off to college, your “starter pack” might include shower shoes, instant coffee, laundry pods, and Ramen packets. For a new homeowner, it might consist of a doormat, a house plant, a Glade plug-in, and a coffee table book you’ll never crease the binding on. For someone entering the start-up funding world, though? Grab your Lingo 101 textbook, start-up social media, Brad Feld (I’ll explain), and your sprinting shoes. If none of these make sense as a standalone, just keep reading.
Tool 1: Lingo 101
Like every other industry, the startup funding space has enough jargon to fill up a dictionary. If I listed it all, we’d both go cross eyed — so here are a few gems that make their way into almost every conversation (and that I’ve fallen victim to).
Disruptive – The tech industry is oversaturated. Period. Part of your market entry strategy takes into account competitors, who may or may not be seasoned. Being ‘disruptive’ was a must-have for any entrepreneur who has found success, and is a must for anyone trying to enter any market, any time. This applies whether you’re launching as a result of the times, like Mandolin meeting our musical needs in the age of COVID-19, or you’re just someone coming in and doing something better than anyone else out there, like Lessonly.
Early Adopter – Any user, promoter, or cheering section for an early-stage company. Cheers to another term that is exactly what it sounds like! Synonyms include ‘faith-haver.’
Domain Broker – The process of naming companies has taken up a large chunk of my time here at High Alpha. Most people know what a domain is, and what a broker does. Yet every time I use the term ‘domain broker,’ I have to check myself to make sure I’m using it correctly. Straight up, a domain broker finds out how much domains are going for and facilitates the transactions between the buyer and the seller. The overall naming process in general never ceases to blow my mind, and the demand for cool, recognizable, easy-to-remember domains makes domain brokers quite popular in the startup world.
MVP/MVB (minimum viable product/minimum viable brand) – Nearly every startup begins their journey with an MVP. It’s a version of their product that’s not perfect — not even close to the end-all-be-all — but one that’s the best it can be with the resources and time the company has. The same goes for MVB. A brand is built simultaneously alongside the rest of the company, being tweaked and updated along the way. We’re going to double dip here with another word commonly used when talking about MVPs and MVBs: iterate. The key to building the first version of a product, brand, or anything else in the early stages is that it should be able to be iterated on. It should stem from a storyline, and as the story continues to be told, it should evolve to keep up with outside advancements.
Kickstarter – Yes, the site we all know that helps bring projects of all kinds to life through backers and funding. A self-explanatory name that we also use when talking about angel investors helping to get a company off the ground with initial funding cash.
My favorite lingo runner up falls into the SEO camp: ‘cannibalization.’ Again, who said SEO was boring? We’re talking about words eating words here. It’s fascinating.
Tool 2: Bookmark Startup Investment Sites
If you want to be immersed in the startup world, take your blinders off — pay attention to the things happening outside of your desk. Half the job, I’ve learned, is keeping a pulse on who and what else is being stirred up by other startups. This isn’t just about keeping tabs on the competition, but about getting inspired and feeling challenged.
This kind of buzz will happen organically, but sites like Crunchbase and Visible add context to the buzz. If you’re new to the scene, like me, it also helps frame up what people even care to know. A platform like Visible helps me understand the right questions to ask when it comes to discussing investors. Crunchbase shows me trending startups and notable funding announcements before I even type something into the search bar. Familiarizing yourself with the lists of investors associated with companies with booming funding rounds gets you more acquainted with top dogs in the industry.
Tool 3: Learn the Startup Funding Lifecycle — Take the Venture Deals Course
This September, I felt like I was hearing Brad Feld’s name a lot — we hosted a Speaker Series with him, I started his Venture Deals course, and I attended a Techstars-sponsored AMA with him. I can’t say I’m mad about having so many chances to learn from him, though. If you’re looking for startup funding explained, the online Venture Deals course that’s put on by Techstars and Kauffman Fellows is a great place to start. Foundry Group Managing Partners and Techstars affiliates Brad Feld and Jason Mendelson lead the eight-week course, which walks through the entire startup funding process, from finding your first investor for a seed funding round to being acquired.
Tool 4: Don’t Forget to Sprint
The concept of sprinting is not new. If your startup partakes in a sprint of any kind, it’s likely an iterated (buzzword alert!) version of Google Ventures’ design sprints. In short, a sprint is a five-day (or less) process of throwing ideas at a wall to see what sticks. In that short amount of time, you’re working with a team to concept the MVP of an MVP, having conversations with industry experts, prototyping, researching competitors, designing brands, and more.
At High Alpha, we sprint once every quarter for four days. We get a short break after the sprint, but our heart rates remain intense and we slow only to a fast-paced jog before we actually start working to build the companies we created during our sprint. Perhaps the best way to describe our Sprint Weeks here at High Alpha is to break them down by our values:
Yes, the days are long, but a week of sprinting will go by fast. To have a presentable company on presentation day requires nothing short of hustling the days prior.
In our eyes, we’re talking about, ideating on, and dreaming up the next big thing. Once you realize that this (this being the business you’re building) can become real in a few days or weeks, it’s hard not to think beyond, and we’re challenged to do so.
Sprint Week work is never finished. We believe that there’s always room for improvement, and we’ve built benchmarks that keep us accountable. It’s our goal to expect more from each other, and as a result, continually challenging that benchmark so we don’t plan on stopping any time soon. Better to ask for forgiveness later, anyway.
Working at High Alpha may not be your intro to a startup funding company, but anywhere you go will have some version of sprinting — even if it’s called something different. If your company isn’t sprinting, start sprints. A sprint doesn’t have to be an organized event. It can be a mindset, a way to approach a new idea or a new market. It all boils down to coming up with the next big thing. That’s what this industry is all about, right?