When challenges arise for early-stage startups, VCs often advise founders to hire or build their way out of trouble. But with limited funds, people and time, early-stage founders must be strategic in their problem-solving. So, while the weight of your neverending to-do list may make hiring and building seem appealing, we recommend reaching for a quicker, more efficient tool first: optimize, optimize, optimize!
Like a good Swiss army knife, optimizing should be every founder’s go-to tool. By optimizing what’s on hand first, founders can quickly cut deadweight and adapt to changing conditions on the go without wasting time or capital. Instead, try the 5 following optimizations before sinking time and money into more intensive solutions.
Now, this is not to say that adding new team members is a bad move—it’s just not a quick one. Plus, after the months you spend on recruitment, interviews, and onboarding, there is no guarantee that your newest team member(s) will be the silver bullet you’d hoped for. Similarly, building new-and-improved versions of your solution will eventually be vital to scaling your company, but it’s all about timing. It’s a resource-intensive process that will quickly burn the finite funding and resources currently at your disposal. When it comes to choosing the right moment, be sure you feel confident that it’s feeding your NSM directly.
So, before you jump to hiring or building, reach for your optimization Swiss army knife. Founders who make a habit of optimizing what’s on hand first will stay agile and preserve resources to outlast the competition.
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Meet the future of private wealth and asset management: AlphaRora.
AlphaRora is a private wealth and asset management service that allows private investors and asset owners to understand, manage, and optimize their private portfolios and assets through unique insights and automated data. By uncovering data within your portfolio, AlphaRora automates and optimizes your assets, so you can make better decisions and understand your private assets better, including tools to guide you through these events taxes, returns, liquidity events, and allocations.
F3TCH is revolutionizing how hotels communicate with their guests.
Through F3TCH’s patented mobile application for hotels and resorts, guests can now use their smartphones as their hotel guest room telephone, complete with voice, SMS, and rich text capabilities. As a result, F3TCH offers guests, hotels, and hotel brands a much more powerful and modern way to connect with checked-in guests and enhances the most important metric on the hotel business: the guest experience.
HyperC is growing businesses with the most advanced rule AI yet.
HyperC is an AI-based database that solves operational problems in linear time. Powered by the latest advancements in hybrid AI, HyperC stores and manages business rules to enable automatic resource planning with the long tail of exceptions. Connect the data you use every day for trucking, services requests, packaging, manufacturing orders and let the machine figure out optimal operations.
Levantr is building a new way to travel.
For consumers, Levantr operates as a productivity tool for travelers (think: Pinterest meets Trello), allowing travel providers such as hotels, tour guides, and travel agencies the ability to deliver personalized offers/deals to users based on real-time insights. By using Levantr to organize, vote, and build out future trips, travelers gain access to the deals/offers of travel providers—a win-win for all involved!
MRGN is the future of intelligent budgeting for small businesses.
MRGN’s financial modeling and budget planning platform allows SMBs to cut their financial planning time drastically. Through intuitive insights on what drives efficiency and scalability—all without hiring a CFO—MRGN users can delegate to and collaborate with their coworkers, as well as simulate a wide variety of scenarios that could potentially impact their cash flow before they happen.
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Innovation is usually accompanied by the calculated risk of venturing into the unknown. For early-stage founders, this risk can feel especially daunting. With limited funds, data, and time to actually build out your solution, it’s easy to get lost in the frontend development of your company to the detriment of the goal-setting and metric analysis necessary to scale your business successfully.
While every company’s goals will differ, successful companies build their business model around their North Star Metric, i.e. the top-line metric used to define the company’s growth. Broadly, there are six categories of North Star Metric (NSM): revenue, customer growth, consumption growth, engagement growth, growth efficiency, and user experience. The majority of companies set revenue as their NSM, followed by customer, consumption, or engagement growth, and a minority of companies focus primarily on growth efficiency and user experience (1).
Regardless of the specific metric, defining your North Star Metric is ultimately a tool for prioritization. Once an NSM is set, all of your startup operations should be ranked by how much they prioritize your NSM’s growth rate. Founders mismanage this prioritization in two costly ways, which we refer to as being lost in the forest or lost in the desert.
In the forest, think of the trees as all of your startup’s available data. When prioritized equally, the time and resources required to maintain the growth of every tree in your forest will quickly drain the limited resources of your startup. And as your business grows, so will the available data. Even with unlimited resources, the sheer number of trees will eventually make it too difficult for the founder to maintain their sense of direction when they cannot see the forest—their vision—for the trees. Prioritizing every metric is a quick way to run out of resources, time, and direction without growing your venture to achieve its vision.
The classic example of being lost in the forest is a pitch with a plethora of random, “vanity” metrics that look good on paper but do not tie into the overarching vision. For instance, let’s say a founder tells a panel of investors that their venture has 10,000 unique visitors a day, 5 new products a month, a 22% email open rate, and 5,000 followers on Instagram. It’s all good and well that you have lots of web traffic, followers on social media, email opens, and a busy software team, but why do those numbers matter? Have you grown revenue by 20% month over month? Have you expanded your customer base? Is the product sticky? Do your customers like using it? Investors and founders should care about what the numbers mean.
In the desert, you essentially encounter the inverse problem. With fewer (if any!) trees to speak of, the founder is left wandering without any metrics to guide their company’s growth. In this scenario, they may resort to an unsustainable cycle of trial and error in an attempt to guess their way to success. As with our founder lost in the forest, a founder wandering the desert tends to drain their startup’s limited resources by relying on gut instinct or tiny data sets and one-off examples to guide their sense of direction.
The most apparent, dangerous example of being lost in the desert may seem like pitching with no metrics at all. However, in practice, it’s more likely to turn fatal when a founder relies on a mirage created by their limited data sets as direction for the compass for their company. For example, founders without metrics to inform their decisions begin to treat every customer as their NSM. Of course, your direction is bound to change constantly when each customer feedback point becomes how you drive the entire business. With each iteration of this, your product-market fit becomes narrower and narrower. Chasing a mirage is a quick way to mismanage your priorities and deplete your resources.
And in both the forest and the desert, a founder with an NSM need only look up for direction out of their respective predicaments.
The NSM for your startup will be tied to your venture’s vision for the future and the biggest obstacle your company faces to achieving that vision. Outlander’s Jermaine Brown helps founders zone in on their most relevant NSM is through explicitly defining and then working backward from your startup’s vision, mission, and values:
Using your answers to the questions above, rank your metrics in order of importance. You will begin to see how the majority of your metrics will “ladder up” to your startup’s mission, which in turn ladder up to your vision. At the top of your ladder is your North Star Metric—that key metric that demonstrates your vision’s traction and growth. The rungs of your latter are how you incrementally climb: 3-year targets, annual goals, and quarterly goals, etc. You build the ladder with the metrics that support each intermediate goal in support of your NSM.
Ultimately, your North Star Metric is a tool for prioritization and direction of growth for your company. A founder’s clear definition and execution around a North Star Metric will not only lead to better product-market fit but also demonstrates their ability to prioritize growth in every iteration. Not to mention, it will help you measure and illustrate to investors the early traction of your venture, as well as a map of where it’s headed. So if at any point you find that you have somehow missed your North Star, take a moment to evaluate your priorities and pivot your strategy so you don’t end up lost again.
A pitch deck is a critical communications tool for all startups—it is how you tell the story of your venture, make your introductions to investors, and more. However, it doesn’t take much Googling to see that everybody’s got their own opinion of the right and wrong ways to put together a deck or how to present yourself to investors. In my experience as an investor and former founder, the most successful pitches all boil down to one major imperative: a compelling narrative arc.
When you’re speaking to a person you want to partner or work with, it’s always in your best interest to figure out the most impactful way to sell yourself, your idea, or your business to that particular person or group of people. Effective communication is all about presenting a compelling narrative, and when you’ve only got a few slides and a handful of minutes to share your startup’s story, you have to make every word count.
As with all persuasive writing, who you’re pitching to should inform your tone and diction in each iteration of your verbal pitch and every share of your deck. So, first and foremost, do some digging online to see if you can find any clues about what the investor is looking for in a pitch. It’s entirely possible that they have provided a quote for an article about what they think makes a great deck or that they’ve listed their expectations on their website. Use whatever information you can find to tailor your presentation to their most desired style of delivery without sacrificing your authenticity or personal style. It can be a tall order, but it’s worth the effort.
As more startups have learned about our upcoming pitch event, OutPitch 2021, we’ve received many questions about what we look for in a pitch deck. We really appreciate these questions because it shows that the founders not only want to understand us as investors but also recognize the importance of tailoring their message—a skill that is a boon to the long-term success of any entrepreneur and their company.
If you’ve read this far and you’re a founder interested in pitching to the Outlander team, I’ve got some good news! We’ve distilled the core features of a winning pitch, and we’re more than happy to share that information with you. Ideally, your pitch hits the ten critical highlights below in ten slides or less, leaving your audience with a well-rounded view of you, the founder, as well as the problem you’re trying to solve.
The narrative arc of a winning pitch is as follows: Start with the big picture. Then delve into the specifics and how your founding team fits in. Next, bring us up to speed on your progress thus far, then sell us on your venture’s vision for the future. In your vision for the future, be sure to demonstrate your area expertise by identifying any potential competitors or obstacles, followed by your plans to navigate around them. Conclude with your ask. And don’t forget to tailor the details to your audience!
Now you’ve got a pitch with a compelling narrative tailored to Outlander VC, and we want to see it!
Outlander is inviting the most innovative early-stage tech startups in the Southeastern United States to out-vision, outsmart, and outpitch the competition at OutPitch 2021! The live pitch competition winner will receive a $100,000 investment from Outlander VC on a $1M capped convertible promissory note! Read all of the Outpitch 2021 terms and conditions here.
If you’re the founder of an innovative early-stage tech startup headquartered in the Southeast, you are strongly encouraged to apply! The application deadline is 11:59 pm EDT on May 2nd, 2021.
The application request form is simple. Just send us your name, contact information, and the name of your startup.
Then, look out for an e-mail from firstname.lastname@example.org with the link to the full OutPitch 2021 application.
The full application consists of 14 questions, covering your contact information, co-founders, company description, location, product category, website, and pitch deck, and previous funding information.
Yay! We can’t wait to review your OutPitch application. Next, our partners will select the top six startups to pitch live to our top-tier venture capital investors and judges on May 18, 2021.
Best of luck!
What happens when a Jewish girl from South Alabama who started her career in interior design but then moved into tech meets a guy who grew up homeless in Sacramento and then served in the Marine Corps and became a tech investor? Well, beyond getting married (which is an entirely different story), these two outlanders learned they had the same bold perspective on life and business – never afraid to venture off the beaten path, take big risks, and fight for what they believe in. Soon, they realized there were many others out there just like them.
After a decade of living in Los Angeles, building companies and investing in some of the biggest tech businesses in the U.S., we (Leura and Paige) made the big decision to move to the South to be closer to family. It was a bit of a terrifying change since we knew so few people in Atlanta and, to our knowledge, the South didn’t have much of a tech scene. However, we decided that being operators and investors, we could invest outside of tech, and we made the jump. Why not, right?
In Atlanta, we found ourselves in a different world; yet, on some level, it felt remarkably familiar. As soon as we arrived, the introductions to founders and other investors started rolling in. We were floored by the level of activity in a region that we had considered previously to be quiet. However, what excited us the most was the brilliant, bold, and extremely hard-working founders we began to meet. We started to wonder why we had never invested in this region so full of crazy big ideas led by top-notch talent. It took us many months to examine the tech scene, but we identified areas where we knew we could have a significant impact. In the Southeast, the founders needed early-stage capital, higher-quality mentorship, and access to the major tech hubs to build partnerships, to find customers and, most importantly, to raise later-stage capital. Now, it was time to act.
As we began to interact more closely with many exceptional companies, one fact became obvious. The challenges all startups faced, including founders in major tech markets, were even more exacerbated in the Southeast. If you didn’t fit the mold (i.e. white, male, good degree, and good connections), raising capital was an uphill battle to say the least. We all know the appalling stats around the access to venture capital by women, minorities, and other marginalized founder groups. Paige and I realized that in this emerging tech market, as investors, we had the opportunity to change those odds with our own approach.
Our mission at Outlander VC is simple: we invest in great founders with huge ideas, no matter who they are. But, in order to accomplish this goal and create lasting change in our industry, we decided to remove the unconscious bias from our funding decisions by building a more diverse investment and operations team. We passionately believe that when you change the people at the top, you change the pipeline and the outcome. Most importantly, we want our founders to have the benefit of being supported and mentored by an experienced and well-regarded early-stage fund with diverse leadership.
We are so proud to have built a team of outlanders who question the status quo and who are passionate about finding and supporting the next generation of epic founders who might have otherwise been overlooked.
So, who are we? We are Outlanders. We are strangers to the status quo, foreigners who never fit neatly in any box, and excited by the unknown. If this also describes you, we cannot wait to cross paths to learn from your perspective and your vision for the future.