The Six Ts for Startup Growth – 2024

Venture capital fundraising is a key step for many founders when scaling their startups. When asked “how do you decide to fund one company and not another?,” our team points to the Six Ts: theme, team, terrain, technology, traction, and terms.

Our team recently published the Startup Growth Toolkit – six blog posts focusing on each of the Six Ts.

Curious about the fundamental principles of fundraising and startup growth? Here’s a summary of then 6Ts:

Theme – How to Tell Your Startup’s Unique Story

In preparation for and during a fundraising pitch to investors, entrepreneurs should create and articulate a compelling story. The narrative should be structured in a way that addresses the Six Ts in a logical order, while also being comprehensive and memorable. This should generally start with the theme, which is the problem you are setting out to solve. Most often, the problem statement will fall into one of three categories:

1. Improving on an existing technology or incremental improvement
2. Solving a new problem or enabling a new functionality
3. Addressing a macro change, or leveraging a regulatory, sociodemographic, technological, or other rapid change in status quo that creates market opportunity

Learn about the importance of Theme with insights from Oren Netzer, founder of DoubleVerify (NYSE: DV) and DataHeroes, as well as founding stories from Theator and Hootsuite.

Team – How to Build Your Startup’s Founding Team

Great ideas go nowhere without the right team. For that reason, we support our venture capital portfolio company founders with HR and recruiting support to help with resource planning, recruiting and retaining talent. HR strategy must go hand in hand with business strategy. When building startup teams, founders must establish team credibility, create a strong founder dynamic, and emphasize a culture of trust.

Trulioo co-founder and The Cofounder’s Hub CEO, Tanis Jorge, shares expert advice on the importance of a strong founding team.

Terrain – How to Conduct Market Research

Once you have introduced your founding team and explained why you are the best team to solve the identified problem, the next step is to position your startup by mapping out the terrain, or the market landscape. Show us how and why your startup is poised to break through the noise and succeed by leveraging market trends, competitive analysis, industry statistics and business projections.

This part of the pitch should highlight your strategic thinking to investors — how you will leverage market opportunities, use competitive advantages and defeat threats. Yotpo, Theator, and Check Point Software Technologies Ltd are great examples of navigating industry terrain.

Technology – How to Demo Your Startup’s Solution

There are often multiple ways to solve a thorny problem and your technology approach likely has strengths and weaknesses. This is frequently encountered when evaluating different target market segments, such as enterprise versus SMB. In your presentation materials and during the investor or client pitch, take the opportunity to articulate and demonstrate that the product is the best solution for target customers’ identified problems. Especially with heightened interest and adoption of technologies like AI, it may be hard for investors to decipher what is hype vs. a truly disruptive technology.

Examples from Hunters, Imagene AI and Nutanix showcase how having a unique, industry-first solution can make all the difference in attracting investors.

Traction – Executing on a Startup Business Plan

Traction is one of the most pivotal factors in running a successful startup and therefore, a key part of successfully seeking capital – it proves whether you can effectively execute on your business plan. Traction is also key to early stage venture capital investors to give them foresight into potential growth opportunities and longevity of the business.

VC investors will look for a confident sales strategy, cost of customer acquisition and lifetime value, and team experience to show positive traction. We discuss how Nexla prioritized a growth strategy that suited their business goals and prioritization of steady improvement over burning capital for a big, but short-lived splash.

Terms: Your Guide to Venture Capital Deal Terms

By this point, you have made a connection with venture capital investors and secured interest in your business – congratulations! Now, it all comes down to dollars and ‘sense’, or the venture capital deal terms. The meetings may have gone smoothly up until this point, but now the investors and founders need to agree on the final deal terms.

Through experiences with Nutanix and Braze, we cover the critical factors to consider when negotiating terms with investors.

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Here’s more industry insights and advice from successful founders and our team:

• Oren Netzer, co-founder and CEO of DataHeroes, discusses how he partnered with Blumberg Capital to take DoubleVerify from inception to IPO. Our colleague Yodfat Harel Buchris joins him on TechCrunch.
• TechCrunch talks to our team about “How to Maximize Value Add from VC Investors” in its series of Masterclass sessions.
• LinkedIn News’ Tanya Dua talks about what to look for in an early-stage startup, overhyped areas in AI, and the current macro environment with David Blumberg for “VC Wednesdays.”
• Tanis Jorge, co-founder of Trulioo and founder and CEO of The Cofounder’s Hub, joins us on TechCrunch Live to share practical advice on building a strong co-founder and founder-investor partnership.