Cinchy recently closed a $10 million Series A funding round, and the process of getting it done was made infinitely more complicated by the pandemic.
Even at the best of times, getting all of the stars aligned is a daunting, time-bending process. When the world goes virtual, even seemingly small steps become significant hurdles. Fortunately, our team — and our investors — were able to get through the logistical issues and get to the finish line.
Online Speed Dating: The New Investing
For a Series A funding round, you would typically spend a lot of in-person time with your lead investors to get to know each other and make sure it’s a good fit. As they say, it’s kind of like you’re getting married. There is a meeting, an in-person date, and then the relationship progresses from there. In our case, as a maturing company paired up with a lead investor, there was that initial presentation, and then everything else was virtual. We were “married” virtually.
The lockdown also affected the way we prepared for this round. No one really knows what the future is going to be, so the level of diligence was exponentially heightened as a result of that.
There were about three to five meetings with our VP specifically, and approximately 100 artifacts that needed to be gathered. The level of diligence required was very high relative to what we did in our seed round. Part of that is because a Series A is different from a Series C.
The other part of that could be the fact that investors are more cautious than they would have been before, because there’s so much volatility and unknowns. This was especially true when we were in the thick of the pandemic. Investors are also looking for technologies that are bulletproof, which puts a new lens on how we approached this round.