The CMO's role in fundraising: Advice from those who've been there

Matt Heinz

Whether you're pursuing your first seed round or bringing in growth-oriented private equity, chief marketers are increasingly playing a central role in fundraising - well beyond building and managing "the deck." Last Friday's CMO Coffee Talk featured a robust discussion with specific recommendations, cautionary tales and more.

Special thanks to Natasha MorganSydney SloanAdam New-Waterson and Carilu Dietrich for leading the discussion.

A few chat highlights from all participants is below. If you are a B2B CMO and would like to join this amazing community of your peers, DM me for an invite.

Fundraising is kind of like childbirth (sorry for the gendered metaphor). Nothing like it but if you could remember how hard it was, you may not do it again.

CMOs are about storytelling. Fundraising is just another kind of storytelling.

Having been on the other side where I saw pitches all day - if you don’t have a concise story you’ll get lost in the day.

If the lead investor has a banker history, they will focus on CFO, if lead investor is former operator, more likely to focus on CEO/CRO/CMO.

I realize now that our pitch really followed the “Best Sales Deck ever” approach (Zuora) unconsciously. Identify the market gap and opportunity and then go from there.

Crafting the story, describing the market and conditions along with the outlook and direction. Yes we’ll create the presentation, yes we should be keen to understand the demand and how the company will create demand and capture it so that’s all part of that story.

Last year the data showed that only 6 percent of Boards in the US had a Marketing person on them.

Different investors want different info. Private equity (PE) = marketing performance by channel, conversion rate, headcount, structure, etc. Venture capital (VC) leans harder on founder(s) product market fit, market opportunity.

VCs invest in companies with two parts: a customer acquisition engine that burns money, and a customer retention engine that prints money. PE generally wants to invest only in the second part. That is not bad, and there are - as someone pointed out - lots of growth-oriented PE type firms emerging.

An approach I’ve often done is that I put together two versions of the deck: 1) is the Franken-deck that has everyone’s input (finance, legal, investor), and 2) my deck that is how I would present the story. Instead of calling their baby ugly (the Franken-deck) I give them a compare, and often it becomes clear that the clear/simple story is the better approach. Yes, it’s lots of late night work to do the two versions, but have been happy with the end result.

We also did run ABM plays that were very specific to investors before and after our pitch. It works.

Focus on building a relationship with your CFO from day one and prove your value in board deck contributions and ideally presenting, this organically leads to CMO involvement in fundraising (w/ the right CEO/team).

One thing I’ve found to really help regardless of stage and situation is for the CMO to develop a master investor deck… e.g. “Investor Deck - Master Library” w/ TAM, ICP, P&L, SaaS Unit Economics, Routes to Market, Market Landscape, GTM, etc. If marketing develops and maintains this it just helps move faster for fundraising, updates, general IR, etc

What's the ONE succinct storyline you want people to remember?

While investors always tend to want the “numbers” right at the front of pitch, if you are trying to find long-term investors, they will tend to value the story/market first, and numbers second. I had CEO/Founder that stood firm that he would not lead with numbers as those were not the investors he wanted. A hard stance, but one that paid off over the long term in this particular instance.

Don’t lie to a VC. My CEO had a different opinion from me. I thought it was very off, but I sat there quietly. And the VC turned to me & asked what I thought. I tried to tread water & back my CEO up, but that was COMPLETLY wrong to do. Should have just directly contradicted my CEO. The look of disappointment on the VC’s face will haunt me forever. :)

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