Despite the economy, fears of a bubble, and sometimes sheer reality, consumer-focused startups seem to be almost rolling in VC money — and why not? Every investor wants to get in on the ground floor of the next Facebook. But that leaves B2B startups — despite the payoff potential of large contracts with big players — in a tougher fundraising position. As the Wall Street Journal reported today, while the total investment in B2B tech firms is greater, it rose at a substantially lower rate over the past year — a 21% increase compared to B2C startups’ 182% jump. So how’s a potential B2B game changer to get a piece of that pie?
It pays to see the challenge of startup fundraising as a kind of PR on steroids — the same requirements for innovative thinking, top-notch, attention-grabbing communications, and a buzz momentum propelling a company from strength to strength. The tools may be different (no press releases aimed at VCs), but the goal is the same: a reputation that inspires confidence, in this case, measured by dollars of investment.
If anything, this pre-final product or service phase is most heavily dependent on PR skills — and of the most highly trained variety. Fail to inspire and the dollars go elsewhere; over-hype and the concept may burn cash — and then bridges — without making it out of development. This is the time to put your concept and company through serious paces with a professional who can predict the hard questions, and help you figure out if you’re really prepared to answer them.
Being a bit of a tech junkie, I read far too much these days about startups, incubators, and venture capitalists — and relatedly about commentators’ fears that the explosion in tech development is just another market waiting to go “pop.” Some concerns may be justified — perhaps especially in the mushrooming B2C field — but I remain convinced that the chaff just comes with the wheat. And part of the process for startups competing for easy or scarce money is demonstrating “wheatness” by working with a professional to tell your story by first making sure you have a real story to tell.
