Fundraising Notes
Fundraising Strategy & Metrics
Internal notes on what to show VCs and how much to raise
Based on your current traction and product state, you're in the pre-seed to early seed stage. You have a working product with some early users, but not yet at scale.
What You Have
- ✓ Working product (MVP+)
- ✓ Some user traction (50K users)
- ✓ Paying customers (conversion happening)
- ✓ Clear product-market fit signals
- ✓ Multiple revenue streams validated
What You Need
- • Faster growth (scale from 50K → 500K users)
- • Revenue acceleration (current ARR → $1M+)
- • Team expansion (eng, sales, marketing)
- • Marketing/CAC optimization
- • Enterprise infrastructure
$1M - $1.5M
Pre-seed round, 12-15 months runway
- • 2-3 engineers
- • 1 marketer
- • Modest paid acquisition
$2M - $3M
Seed round, 18-24 months runway
- • 5-7 engineers
- • 2-3 marketing/growth
- • 1 sales lead
- • Aggressive paid acquisition
- • Hit $1M ARR milestone
$4M - $5M
Large seed, 24+ months runway
- • 10+ engineers
- • Full go-to-market team
- • Enterprise sales
- • Strong Series A position
Priority 1: MUST HAVE (Lead with these)
What to say: "50,000 users (40% MoM growth)"
Why it matters: Shows traction and market demand. MoM growth shows momentum.
What to say: "40% convert free → paid within 30 days"
Why it matters: This is EXCEPTIONAL. Most SaaS is 2-5%. This proves product-market fit.
What to say: "85% monthly retention, 75% annual retention"
Why it matters: Shows product stickiness. Anything above 80% monthly is excellent for SMB SaaS.
What to say: "$XXK MRR growing X% MoM" or "$XXK ARR"
Why it matters: VCs need to understand revenue scale. If under $10K MRR, lead with growth rate instead.
What to say: "X% MoM user growth, Y% MoM revenue growth"
Why it matters: Growth rate matters more than absolute numbers at this stage. 20%+ is solid, 40%+ is exceptional.
Priority 2: SHOULD HAVE (Supporting metrics)
What to say: "ACV of $588 (Starter) to $1,788 (Accelerator)"
Why it matters: Shows you can monetize well in SMB segment. $500+ ACV is strong for PLG.
What to say: "CAC of $XX (67% organic, 33% paid)"
Why it matters: Shows efficiency. If mostly organic, your CAC is very low which is great.
What to say: "LTV:CAC of 5:1" (if you can calculate it)
Why it matters: Shows unit economics work. 3:1 is good, 5:1+ is exceptional. Calculate as: (ACV × retention) / CAC
What to say: "X month payback period"
Why it matters: How quickly you recoup CAC. Under 12 months is good, under 6 is exceptional.
What to say: "85% NRR (from retention + upgrades)"
Why it matters: Shows customers stick AND expand. 100%+ means expansion, 85% is solid baseline.
Priority 3: NICE TO HAVE (If asked)
At your stage, VCs don't expect these. If asked, say "we'll track that once we reach $1M ARR":
- • Gross margins: Early stage software is ~70-80%, don't overthink it
- • Sales efficiency (Magic Number): Only relevant once you have real sales team
- • Rule of 40: (Growth rate + profit margin) - you're not profitable yet, that's fine
- • Detailed cohort analysis: Need 12+ months of data for meaningful insights
- • Pipeline coverage: Only relevant for enterprise sales motion
Slide 1: Problem
No numbers. Just nail the pain point.
Slide 2: Solution
Show product, mention "50,000 users trust LaunchPad"
Slide 3: Market
TAM/SAM/SOM: "5M businesses start yearly, 33M total SMBs, targeting 1M in 5 years"
Slide 4: Traction (THE MONEY SLIDE)
This is where you drop all your best numbers:
- • 50,000 users (40% MoM growth)
- • $XXK ARR (X% MoM growth)
- • 40% free → paid conversion (industry avg: 2-5%)
- • 85% retention
- • LTV:CAC of X:1
- • 4.8/5 stars, 1,200+ reviews
Pro tip: Use a bar chart showing MoM user growth, and a line graph showing revenue growth.
Slide 5: Business Model
Show pricing tiers: $49/mo, $99/mo, $149/mo. Mention "ACV of $588-1,788"
Slide 8-9: The Ask
"Raising $2.5M to scale from 50K → 500K users and reach $1M ARR in 18 months"
Growth Rate
They want to see 20-40% MoM growth. If you can show 3-6 months of consistent growth, you're golden.
Product-Market Fit Signals
40% conversion rate, 85% retention, 4.8/5 reviews - these all scream PMF. This is your superpower.
TAM (Total Addressable Market)
5M new businesses/year = huge TAM. 33M existing SMBs = even bigger. This market is massive.
Team
Do you have relevant experience? Have you built products before? Can you execute?
Unit Economics
LTV:CAC and payback period. If you're mostly organic, your unit economics are amazing.