We hear this every day from startups. In these times, are investors still open for talks on investing? Or is this a funding source closed for a long time?
Mark Suster, one of the smartest investors who does wonderful work on educating on venture capital and the dynamics, has held a keynote on “Funding in times of COVID-19”. You can have a look at the whole presentation here. In addition. Mark Suster was on a podcast late April and gave more detailed insights on the fundraising situation at the moment. He was so kind as to deliver a summary of it on his both-sides-of-the-table. Good read indeed.
But let us summarize the main take-aways:
- Yes, investors are mainly putting money into their own portfolio companies at the moment
- Fundraising takes time.
- If you need to raise funds right now, this is more difficult in some industries. In other industries everything is fine.
- If you need money on the table in autumn, you still need to get going to make contacts and initiate first talks. By autumn, more investors will be in raising mode again.
So to give a direct answer to the questions at the beginning: Yes they are. Not all of them, but if you need to close rounds from autumn onwards, you need to kick-off the process now.