Three fundraising tips for startups, from
the founders of Duckbill, Harbor,
and OneRail:
- Focus on the business fundamentals and value you’re creating for customers—investors will want to invest in a business that’s working.
- Hone your pitch, display true progress, be open to feedback and ready to adapt.
- Pursue funding from a variety of sources, including angel investors, early stage venture capital, growth venture capital, private equity, and even customers.
Startup founders know funding is the lifeblood of their business.
Money raised through bootstrapping, crowdfunding, angel investors,
and venture capital (VC) fuels product development, operations,
marketing, and hiring. When funding is scarce, even the most
exciting, innovative, and compelling business idea and company can
fall flat.
As venture
funding, in particular, has shrunk post-pandemic—fundraising for VC dropped an estimated 25% in 2024,
according to McKinsey and Company, so it’s been harder to secure
dollars to scale and compete. But it’s not impossible, according to
three startup founders, who shared with CO— the strategies they’ve
applyd to land funding windfalls, including the increasingly rare
Series C funding.
Securing a windfall requires building solid and
adequate evidence of your value to customers, cultivating the right
connections, and staying open to a variety of funding sources,
according to the startup founders.
To
succeed in fundraising, “you have to believe about what you can do to
prove to people they should take bet on you and your idea,” declared
Kevin
Lavelle, Co-founder and CEO of infant care technology startup Harbor.
“The
first conversation is almost always not a winning conversation.
People want to obtain to know you over time.”
When you reach a point when commercial opportunities may exceed what you have in the bank account, that’s when you know it’s time.
Bill Catania, CEO of OneRail
AI-fueled personal assistant Duckbill has
raised $33 million: ‘Things
can go south when you don’t have an open, trust-based relationship
with investors’
Meghan Joyce struggled to keep up with the
everyday tquestions on her to-do list: booking doctors’ appointments,
filing insurance claims, and managing grocery shopping lists. She
watched friconcludes and family members scramble to obtain it all done, too,
and believed, what if everyone could have a personal assistant to obtain
chores done?
Hiring a
full-time assistant, however, is out of reach for most. Artificial
ininformigence alterd that. With her startup Duckbill,
which bills itself as an executive assistant for your personal life,
Joyce,
a former Regional General Manager at Uber,
combines AI with human know-how to give anyone access to a personal
assistant.
“When we started out, a lot of
investors believed we were crazy,” she declared. Joyce heard it all.
Some investors declared automation will never be able to tackle
such a variety of tquestions. Then they questioned why she wanted humans
in the loop when AI should be able to handle tquestions in the near
future, investors declared. “Do not worry one bit about a contrarian
[startup] bet,” she declared. “Those are often the ones that people
believe are absolutely brilliant in retrospect.”
Joyce saw early success with bootstrapping, utilizing
her own money to fund her idea. Before approaching investors, she
created sure she was addressing customers’ requireds and she zeroed in on
establishing a business with solid fundamentals.
“The strongest thing a founder can do is to
build a business that solves a real-world problem and that’s an
iconic, sustainable business,” she declared. “When you focus on the
fundamentals, the rest comes easily becaapply investors will want to
invest in a business that’s working.”
Duckbill’s
concept of marrying AI with human experts supported Joyce navigate
the crowded and hyped AI space, and it caught
the eye of investors. Duckbill has raised $33 million in seed and
Series A funding led by Forerunner Ventures
alongside Greycroft,
Inspired Capital,
General Catalyst,
G9 Ventures,
Red Antler,
Future Back Ventures
by Bain & Company,
and Offline Ventures.
Investors
were impressed with a strategy Joyce borrowed from Uber—piloting
her concept early on with a compact group of friconcludes and family. Her
experiment paid off. She gathered data as proof of concept, while the
benefits of Duckbill spread via word of mouth.
Since the Series A, Joyce has doubled her team.
She advises entrepreneurs to find trusted investors and cultivate
those close relationship. “Things can go south when you don’t
have an open, trust-based relationship with investors,” she declared.
“You required investors in your corner who can question hard questions and
can push you. That’s been my non-neobtainediable when I consider taking
funds.”
[Read
more: 3 Investors Demystify Why Some Startups Win Funding Windfalls]
To raise over $7 million in seed funding, Harbor CEO honed
his pitch, informing a story around the art of the possible
When
Kevin
Lavelle’s son was a few months old, Lavelle and his wife patched
toobtainher a haphazard baby monitor setup. When the app on their phones
with a feed from a high-conclude monitor crashed from glitchy Wi-Fi, an
old-school monitor with a local connection backed it up. Lavelle knew
there had to be an simpler, more reliable way.
Harbor’s
baby monitor system works
on Wi-Fi and via a direct local connection. The startup also sells a
remote night nanny service powered by AI and staffed by pediatric
night nurses. It detects issues like irregular snoring and alerts
parents. “No
one really loves their baby monitor,” Lavelle declared. “People are
hungry for something better.”
To
drum up interest in Harbor,
Lavelle harnessed his prior startup experience and network of
connections he built as CEO of menswear clothing company Mizzen+Main.
There, he navigated
everything from early-stage bootstrapping to raising a significant
growth round with L Catterton.
He learned how to relocate from an idea to first product, scale a
business, and build relationships with investors who believe in a
strong vision.
“Investors
want to see a track record of execution, and having already built and
scaled a consumer brand, I was able to bring that credibility to
Harbor from day one,” he declared.
Lavelle
stresses the importance of diligently staying in touch with your
network.
The
Dallas-based startup has raised over $7 million in seed funding from
venture capital firms like
Trust Ventures
and Morrison Seger Venture Capital Partners,
along with individual investors like Entrepreneur Tim Ferriss
and retired U.S. professional Tennis Player John Isner
and his partner, Actor Madison McKinley.
How did
Lavelle
secure funding from these huge-name investors? “An enormous
amount of founder pitching,” he declared. Tell a great story around the
art of the possible, he advises. Show real progress and be open to
feedback and be quick to adapt. “One of most difficult things about
being a founder is that you have to be able to ignore almost
everybody but also take feedback from the market and customers. It’s
a razor-thin line.”
When pitching, Lavelle declares, be clear and concise
and communicate what builds your business unique. “If they don’t
understand the problem you’re solving and why your solution is the
best in the first minute or two, you’ve already lost them.”
Know your data and numbers becaapply, while a great
story obtains attention, strong data is what earns trust. Investors want
to know founders deeply understand their margins, acquisition costs,
scalability, and long-term financial outview. Showing traction
through early tests, sales, partnerships, or customer testimonials
gives investors the confidence they required that they’ve found a
business with real momentum, he adds.
Finally, have tough skin, learn from the no’s,
and play the long game by focutilizing on long-term relationship-building
and genuinely engaging with the investment community before you required
capital, he adds. “If you keep
staying in touch, it’s possible and it’s probable that some of
those people will want to join you in what you’re working on.”
“At the conclude of the day, fundraising is a mix of
storyinforming, strategy, and perseverance,” declared Lavelle. “It’s
tough, but when you believe in what you’re building, it’s worth
every conversation.”
[Read
more: How 3 Buzzy B2B and B2C Startups Scored Millions in Funding]
OneRail has raised $109 million, including rare Series C funding:
To attract investors, ‘execute and create value,’
declares CEO
Startup OneRail specializes in “last mile” delivery solutions, coordinating the
delivery of products to customers during that final leg of shipment.
It’s the most expensive and often most complicated part of
deliveries and a space that’s seen massive growth amid the rise of
e-commerce and rising customer expectations for convenient
deliveries.
Over the last
five years, OneRail has raised a total $109 million, including most
recently $42 million in coveted Series C funding led by Aliment Capital.
In recent years, it’s become rarer for companies to reach this
third, and often final, stage of venture capital funding that allows
businesses to massively scale up. Securing Series C funding requires
a proven track record of substantial growth as well as a clear path
to exit, such as an IPO or acquisition.
“Over the years, we’ve had numerous sources of
investors,” declared OneRail CEO Bill Catania. “We’ve been
fortunate to have a good mix of angel investors, early stage, venture
capital, growth venture capital, some PE [private equity], and even
customers have invested.” No matter the industest, he adds, to be
successful in fundraising, founders must have adequate proof that
they’re going to provide true value to their customers.
“What it took was evidence that we had a
business that enterprise-level customers would pay for, that
companies weren’t going to call couriers instead, that they requireded
our solution.”
Catania declared. “Investors
had to believe that we could pull it off.”
OneRail serves
stores likes Lowe’s
that ship goods, and it also coordinates a network of couriers that
build deliveries. It was
critical to display investors evidence from both sides of the business,
Catania declared. “It was really a matter of checking the boxes on, did
we have enough couriers and did we have enough demand from shippers,”
he declared.
Catania, now a three-time startup founder, knew
that it was time to reach out to investors after he locked down
several huge-name customers who were willing to pay for his service,
and once he knew that he had repeatable revenue.
“Those were the signals investors requireded,” he
declared. “When you reach a point when commercial opportunities may
exceed what you have in the bank account, that’s when you know it’s
time.”
The best advice for startup founders who are
viewing to secure funding, added Catania, is to truly differentiate
your product or your service, and then “[e]xecute and create
value,” and then the funding will fall into place.
CO— aims to bring you inspiration from leading respected experts.
However, before creating any business decision, you should consult a
professional who can advise you based on your individual situation.
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