Partao, founded by two former Amazon execs, a machinery parts e-commerce startup is already making noise—raising €3 million just months after launch. COO Virginia Strong explains.
Early traction: You had just launched when you raised €3m — what did you show investors so early that gave them conviction?
Virginia: We had created a pilot marketplace with 300K SKUs which showed high SEO and customer traction. However, we found that investors were more interested in 1) Who we Were (Our Team slide moved to the first slide in our presentation), and 2) the Market size (> 250B+, which was a larger than the market of a similar company in a similar space that was raising their 20M Series B round amongst a similar group of investors).
Investor strategy: How did you decide which investors to approach, and what was your method for getting their attention so quickly?
At first, we talked to all of our VC contacts, but then we tailored it back to ensure we only talked to VCs who invested in both Pre-seed and Marketplaces/Saas businesses. We were very lucky getting attention as VCs started to come to us. Two key enablers here were 1) Stealth StartUp status on Linkedin. It lets partners and analysts bulk search on Linkedin and 2) my name was printed in a news blog about hot new founders, which proved a very successful inbound channel.
Once you receive terms sheets, it is important to do due diligence on your investors. We did calls with current and past companies of our potential lead investors. The feedback was telling and this was the main reason we ended-up with Mangrove as our lead investor (Our experience has been 100pct in-line with the feedback we received).
Pitching: Was there a particular narrative or framing of Partao’s vision that you found really resonated?
It was challenging to resonate with VCs as very few knew about the agricultural industry – or even the more common spare parts automotive market. So, we pivoted and leaned on what they did know – marketplace and SaaS, IP in Data, and why the big names in ecommerce wouldn’t touch a tail market. When we coupled the “What” with the “Who” and the size of the market, VCs were engaged.
Momentum building: You raised 4X your original target in just 6 weeks — how did you create urgency and competition among investors?
We learned a lot during our fundraise! It was challenging, exciting, and required us to pivot. The hardest part is getting that first offer, the first term sheet. I’d highly recommend striving for that. Just 1. All you need is 1. Once you have 1, the rest will follow.
Practical advice: Looking back, what are the top 2–3 tactics you’d recommend to another founder trying to raise faster and bigger than expected?
Look at fundraising as a sales funnel, you need to have a lot of leads at the beginning to end-up with multiple term sheets at the end. VCs all have a different investment focus and look for different things, so you are going to collect a lot of rejections along the way and that is completely fine.
This article was published in the Silicon Luxembourg magazine.
