You’ve raised a Series A, what happens next?
First of all — congratulations! Less than half of seed-funded startups make it through a Series A round, so you’ve achieved something special. But where do you go from here?
You may still be riding the adrenaline rush and feel ready to tackle the next challenge, all guns blazing. Yet it’s important to slow down and think strategically about yes, boosting your growth, but also ensuring you remain in control during the process.
Read on to find out how to guide your startup to success after Series A.
Keeping investors on side
Who’s in charge after a Series A, the investors or the founder? There is a long running debate about this. While recent years have seen more founders maintaining ‘control’ over their boards, you should still prepare to be challenged more than you used to.
Even if you have a majority of board seats, your investors can still act as a potential brake on your plans. As Paul Graham explains:
“Control of a company is a more complicated matter than simply outvoting other parties in board meetings. Investors usually get vetoes over certain big decisions, like selling the company, regardless of how many board seats they have. And board votes are rarely split. Matters are decided in the discussion preceding the vote, not in the vote itself, which is usually unanimous. But if opinion is divided in such discussions, the side that knows it would lose in a vote will tend to be less insistent. That’s what board control means in practice. You don’t simply get to do whatever you want; the board still has to act in the interest of the shareholders; but if you have a majority of board seats, then your opinion about what’s in the interest of the shareholders will tend to prevail.”
The key takeaway here? Don’t let tensions build up and spill out in board meetings and votes. When constructing potentially contentious plans, proactively seek approval and buy-in from investors. If they feel part of the process and understand why you’ve decided on a particular strategy, they won’t stand in your way — and will probably even help you make it happen. You are both on the same side after all.
Hiring the team
It’s time to grow, of course, but grow smart. Any Series A veteran will tell you to avoid hiring anyone new for the first month. This is because, when you first enter this stage, you need to figure out your new path, goals and aspirations. If you hire too soon, the new hires may not be exactly what you need for the era to come.
Once your plan is in place, remember that quality is always more important than quantity. If you hire three people, you may expect your figure to triple, however this isn’t always the way. So how can you make sure the members of your new team will be assets?
One thing that can make or break a new hire is onboarding. While the new team member may tick all your boxes and look perfect on paper, if you don’t have a proper onboarding process they won’t be able to perform to the best possible level they can.
In the new world of remote/blended working we’re all adapting to, it can be difficult to onboard new employees when you’re not face to face. Luckily, there are tools you can use to make the process more smooth and time effective:
- Record training sessions, and send them to new employees to watch before their first day
- Introduce new joiners to other employees, virtually and in real life when possible
- Add training resources to Microsoft Stream that can be accessed as a FAQ
- Build welcome packs that can be added into a shared folder, and ensure the HR or line manager blocks time to check in daily
Avoiding meeting overload
It might be comforting to think that Series A funding will free up your time, enabling you to spend investment on talent that you can trust to delegate your tasks to. Unfortunately, as your leadership and advisory teams grow, so do the number of people placing demands on your time.
Technology is the answer. Thanks to modern cloud software, we can minimise meetings and keep investors, advisors and leaders up to date at the same time. A particularly useful tip is to create a shared dashboard of documents showing KPI achievement and growth indicators.
These docs could be maintained by one person in your team, or by designated leaders in each area. The main benefit is that, even if you can’t find time to meet, all of your startup’s key players can see the state of play. And with features like comments and suggested changes, communication can occur directly in the document, rather than through a winding email thread.
For times when you must meet but can’t be there in person, video calling apps will become your best friend. After the past year, we’re all familiar with Zoom, Teams and Google Meet. With noise cancelling features and consistent updates, Microsoft Teams is a reliable choice.
Stay in control while growing
Too often, startups scale too fast and lose control of the wheel, particularly after a Series A when there is so much change occurring. However, whatever the change may be, it’s important to make sure you’re taking the necessary steps to stay in control. You may notice you’re running out of time to cover all bases. At this point, it’s helpful to look for a managed service provider that can handle issues that you may not have time for, or aren’t hugely experienced in. But what should you be looking for when adding a third party into your team?
- A provider that wants to see you grow, and believes in your mission
- A plan that works with your timeline, and scales up your system at a rate you’re comfortable with
- 24/7 support
- Remote management and patching so that wherever you happen to be, you can receive the help you need
Here at OneMSP, we exist to grow alongside your business, and strive to keep you in the driving seat while we handle everything IT. To find out how we can help your business flourish after Series A, get in touch.