Guest Blog: How I Raised £1m for a Purpose-Driven Business
By Kanu Batra - Co-Founder of Speek
Fundraising for a start-up, especially one solving for a taboo topic like “self-harm in young people” was no small feat. Yet, it's entirely POSSIBLE.
We were fortunate to close our round despite the fundraising winter. So, we’re sharing our learnings to help founders who are still in the thick of it.
While many aspects of our fundraising journey went smoothly, some challenges were beyond our control—such as the ever-present anxiety. For us, it’s an inevitable part of the rollercoaster, however, thorough preparation helped us navigate the tough days a bit more effectively.
You can design your fundraise to attract the investors you want
For Speek, it was important to bring investors that want to solve the problem at scale but not overnight and not with big margins.
Hence, 2-months prior to formally kicking-off the fundraise, we worked with David Fogel our Advisor through Zinc and Tim Deeson via LSE Generate to map out our process.
We explored the following step-by-step:👇🏾
Build momentum by identifying who is accountable - As two Co-founders of an early-stage medical business balancing day-to-day operations while fundraising was crucial. We decided I would fundraise while Ness focused on delivery. This allowed me the mindspace to focus purely towards fundraising keeping the momentum going (I did slack during the paperwork process - that’s for another blog).
Build confidence by sharing the “Why” and not just what - Why we are solving what we are solving, why is it important for the buyer/user, why we are building the way we are building. I used to get very nervous about being right until I realised it is about sharing the thinking process rather than a fancy detailed plan (at pre-seed stage). This is the real deal, and this for me, is what helps an investor make a decision for a purpose driven founder. This is what makes your pitch deck strong, simple and interesting.
Getting the house in order
Preparation, Preparation, Preparation!
#1 We created investor personas and tailored pitch decks for VC vs. impact focussed investors.
#2 Built a list of 150+ potential investors based on our target investor persona.
#3 Set out to find people who can warm intro you to potential investors. High-quality intros are a deal changer! Investors jump at intros from other investors and customers - tried and tested.
#4 Created intro blurbs and personalised it for each outreach. This makes it easy for people to intro you.
🗨️Tip: Have your data room ready - we did not have any 5-10 year projections in place, but did have material around science, budget planning ready and available.
Key to success
Understanding the fundraising funnel - Accept that you’ll hear more “No’s” than “Yes’s” during a raise. This is unfortunately the reality when you’re fundraising. “No’s” were less painful when I realised how many conversations are necessary for conversion. 67+ first meetings lead to 12 final ‘yes’s’!
Practice with real investors - Even when investors said they don't invest in “mental health”, “services” or our “stage”, I took that opportunity to do a practice pitch. I’d say “yes that’s fine - no expectations, but how about we chat?’ and some of them did make time. It’s free pitch practice with valuable feedback! Daring Capital also organised a professional pitch coaching session, with the fabulous Jennifer, and an Angel Investor. Bonus: You might end up leaving with an intro to a potential investor.
A strong deck: There are many interesting blogs on good decks, so I will skip that. Here is one that I particularly enjoyed.
A good pitch: In my experience the successful pitches were where I was able to educate investors about the space - explaining the problems and motivations of our users and the why around our thinking process for the solution. And do validate all this with facts and not just theory i.e. number of users/engagement/clinical outcomes. Share about the pivots, they show depth and resilience!
Under-represented Founders
Entrepreneurship is an elitist career choice, at least that’s what the fundraising trends show (female founders received a mere 2.8% of VC funds in 2023). As an under-represented Founder I de-risked my journey by joining Zinc, a mission-driven venture builder - added bonus Zinc comes with capital, a network of experts (who are AMAZINGLY helpful), you meet Co-founders there - I found mine and lots more.
On a mindset level, something that I think works for me is to go after an opportunity if I want it, regardless of the odds. This may sound simple, but go after what you want and get creative about how to approach it - pitch to Alma Angels, Daring Capital or reach out to exited Founders who represent you. It does take under-represented Founders longer to fundraise but it will happen. Your passion and real connection with the problem is not something that can be replaced easily.
Highlight how far you have come when someone asks you “why this team?”, immigration is entrepreneurship, fighting the odds and reaching where you have as a Female/ LGBTQ+/Lower income group founder is a testimony of “why you”.
How do you find investors if you don’t know people personally?
“investor office hours” - One of our last yet strategic investors was via someone I met through PlayFair Female Founder Office Hours.
PR - A Family Office reached out by reading about Speek in a newsletter, keen to invest to solve young people’s mental health crisis.
Co-investors - We learnt from another Founder about the concept of Co-investor and brought on-board Syndicate Room.
Grants - Innovate UK runs a programme on Investor Partnership. They match grant funding with equity funding. This helps maximise the fundraising process to get a grant too
Friends and Family - It's important to acknowledge as this creates an advantageous edge in the process. In our case, 20% of our fundraise is thanks to Friends & Family, through my Co-founder and ex-colleagues.
🗨️Tip: We’d recommend tapping into networks like Zinc and Daring Capital, they are on a mission to make entrepreneurship accessible for all and did make it possible for Speek too!
If you’re looking for inspiration, a blog that was HUGELY helpful was Martin Tobias’s Incissive Ventures. A lot of my thinking was formed via the insights he publishes. The blog gave me the language, understanding of stages and depth to consider, before I met investors.
I started the journey as an imposter and left it feeling confident for our next round. I am sure this will change but for now, I will hold on to this feeling.
A big thanks to the investors involved in this round for betting on us.
Kanu Batra
Co-Founder & CEO, Speek Health
LinkedIn | Speek Health
Let's break the cycle of teenage self-harm together!