VC Minute

037. Bridge Round

July 26, 2022 Rich Maloy Season 1 Episode 37
VC Minute
037. Bridge Round
Show Notes Transcript

If you call your funding round a "Bridge Round" it puts you in a defensive position. Listen to today's #VCMinute for what you should say instead.

About SpringTime Ventures

SpringTime Ventures seeds high-growth startups in healthcare, fintech, logistics, and marketplace businesses. We look for founders with domain expertise, forging a path with a truly transformative technology. We only invest in software-based businesses in the USA. We bring a people-focused approach, work quickly, and reach conviction independently. Our initial check size is $400k to $600k. You can learn more about us and our approach.   

About Rich Maloy

Rich's mission is to rebuild the American dream through entrepreneurship. He works with early stage startups transforming the world, giving all people the opportunity to grow, learn and earn. With prior careers in finance and sales, he's now focused on startups investing through SpringTime Ventures where he is a Managing Partner. He's a father of two young children and loves sci-fi, skiing, and video games. 

Rich:

One word you should never say while fundraising is bridge. Saying you're raising a bridge round immediately conjures this question in investor's minds,"is it a bridge to nowhere?" Investors will ask this of themselves or their colleagues, and it's gone from being a joke, to an old joke, to simply the next expected question. If you say this while fundraising, it puts you in a defensive position having to explain why this is not a bridge to nowhere. If you never want to call your funding round a Bridge Round, what do you call it? The beauty of the current seed fundraising environment is that it's a phase. You may raise a Pre-Seed, a Seed, Seed 2, a Seed Extension, all before you raise a Series A. I even saw a funding round recently come through announced as a Series A-2. Even better, if you have most of your current investors committed to a re-invest in this round, then it's an insider round. That carries even more weight. None of these is a Bridge Round and no one should ever label it as such. It may seem minor, but investors can no more stop themselves from picturing a bridge to nowhere, than you can prevent yourself from thinking about a pink elephant, no matter how emphatically I tell you not to think about a pink elephant. So good luck raising your seed to round!