Funding Secured. Now What?

Learn what to do post-funding to ensure your startup's success.

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SDS 038: Funding Secured. Now What?

Hey! thank you for reading issue 038 of Startup Definition Sunday (SDS).

SDS is the only newsletter that is redefining support for Africa's emerging founders. Every other Sunday, we cut through the fundraising and ecosystem noise to bring actionable insights to 1K+ emerging founders.

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I am writing today’s issue from my living room in Nairobi.

I want to express my gratitude for your unwavering dedication as a reader every two weeks. As a token of my appreciation, I've started a biweekly game exclusively for subscribers.

Can you guess the exact time I'm writing today's issue?

Here are the rules:

  1. The person with the closest guess wins $5 from me.

  2. If no one guesses correctly by the time I write the next issue, the prize money increases by $5, until someone gets it right.

No one managed to get within 30 minutes of the correct time. The closest guess was 2 hours and 45 minutes off!

So the prize money is now $20.

So, take a guess at what time of day I'm writing this issue and reply to this email with your guess until 11:59pm on May 18th.

According to Africa: The Big Deal, African startups raised $332M in equity rounds during Q1 2024.

While this amount is approximately 47% less than the previous year, it is still a significant milestone with over 100 startups securing funding.

Now that many of these founders have successfully raised their first institutional round, what should they do next?

Here are the first three steps to take once your funding round is closed and all funds are disbursed.

Confirm all legal and regulatory requirements: It is crucial to promptly send the executed documents to your investors. If it's a priced round, remember to digitally share the shareholder certificates and the latest cap table. Being proactive and providing this information early on will save you time when investors inevitably request these materials individually. It is essential to stay on top of your legal and regulatory obligations now that you have raised external capital..

Set up a kickoff meeting with new and existing investors: Take the initiative to schedule a kickoff meeting within a few weeks after closing your round. This meeting provides an excellent opportunity to align your priorities strategically and operationally. Use this time to strategize and discuss your goals with your investors. Setting key performance indicators (KPIs) and clarifying data collection requirements of new investors will help streamline your progress and ensure everyone is on the same page.

Schedule regular investor meetings: To maintain a healthy feedback loop and keep everyone informed, it is important to schedule regular investor meetings. Monthly meetings are recommended, especially if your startup is still in the early stages (before Series B). Regular touchpoints allows you to focus on building your startup while tracking your growth and keeping your investors updated. Additionally, it facilitates a faster feedback loop, which is crucial in the fast-paced startup world.

Now, let me share my two pesewas:

Closing a fundraising round is a significant milestone for every startup. However, with external capital comes responsibilities. The best founders understand the importance of balancing their startup's growth with keeping investors engaged and informed.

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That's all for today. As always, thank you for being an engaged reader.

I'll catch up with you in two weeks with more actionable insights.

Jasiel

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