Funding announcements are gratifying milestones for startup management, employees and investors. They also put the impacted sector on notice that the company has the confidence of “smart money” to move ahead ambitiously — in other words, to be a player.
However, such events are about more than trumpeting an infusion of capital. They are opportunities for startups to take stock, literally and figuratively, of how they want numerous key external audiences to perceive them. These audiences run the gamut from additional investors to potential employees, industry influencers, ecosystem partners, prospects, and, in some cases, public policy decision makers.
Funding announcements in many respects are primarily tools for creating, possibly for the first time, brand awareness and thought leadership. By their very nature, they command attention. Unfortunately, they can also be squandered opportunities when not strategically planned and executed.
Think about the following for a moment. The fact that nine out of 10 startups fail is well documented. As CB Insights notes in its recent examination of 232 startup failure postmortems, the top reason (42%) is that there is “no market need,” followed by the closely related “ran out of cash” (29%) and “not the right team” (23%). What did not appear on the list was the failure to educate the market correctly when given the chance to create buzz and visibility. Funding announcements are that chance.
Our tech PR boutique works extensively with startups on optimizing all of their media relations campaigns. While we focus intensely on all external communications, experience has taught us that optimizing the true value of a funding round is vital to gaining early success that sets the foundation for future positive recognition as the company strives to be among the 10% of startups that succeed.
A case in point was a client of ours that sits at the intersection of several incredibly hot industry trends: artificial intelligence, deep learning, neural networks, drones, robotics, smart consumer products, and self-driving cars — in short, any device capable of learning and acting under computer control. Their high-level objective is to be acknowledged as leaders in being the “brain” of a product. Talk about hitting a myriad of tech hot buttons!
After comprehensive consultation with the client, agreement was reached that the announcement of this $14M Series A funding round was a prime opportunity to accomplish several important messaging tasks as the company transitioned from an engineering-centric early stage entity to a bona fide player. It was time to take stock and orient toward establishing the brand and its differentiated value in top-of-mind, innovative technologies.
The goals for funding announcement optimization were as follows:
- Highlight the company’s technology leadership and management expertise.
- Explain the extraordinary growth potential of the major markets (specifically the AI-enabled deep learning and neural networks sectors) where their unique software solution is applicable.
- Create brand identification with critical current and future stakeholders.
- Engage industry influencers as to why the company deserves continuous coverage.
- Establish credibility based on thought leadership and funding.
- Drive traffic to the company website.
This is a rather extensive to-do list that highlights why funding announcements are not merely about the money.
Strategy and Tactics
To accomplish the objectives, the following strategies and tactics were employed. They are a guide to many, if not most, on the basic blocking and tackling necessary to hit all of the above tasks successfully.
- A new tagline that easily conveyed the company’s identity was developed and included in all public relations and marketing materials, including press releases.
- The company’s interesting background, including its co-founder and CEO being a member of the Versace family, was highlighted.
- The current client list and previous partnerships with the Department of Defense and NASA got prominent mention.
- The PR team developed a thought leadership platform for key executives to secure high-level contributed content opportunities.
- PR also developed a comprehensive, highly vetted funding media list, inclusive of media and analyst contacts, covering all impacted markets as well as the general business press.
Steps taken to assure maximized visibility are germane for any startup seeking to stand out from the crowd with a funding announcement. While tailored to the specific needs of the client, they are marketing, communications and public relations best practices. Leveraging the services of skilled communications professionals is the first best practice to follow. A few that are more relevant and noteworthy are:
- Pitch the announcement under embargo to secure reporter interest two weeks before distribution of the press release.
- Conduct simulated interviews beforehand to ensure that spokespeople are well prepared and able to successfully communicate key messages.
- Provide reporters with opportunities to interview customers and pre-brief analysts.
- After interviews, send reporters top messages, ensuring message delivery.
- Leverage collateral and relevant points from interviews for follow-ups.
So, how did we do?
As all good PR professionals know, setting reasonable expectations and having the correct metrics for determining what constitutes success are essential. We established these in careful consultation with the client, and the results make for a compelling case study.
For the funding announcement, PR generated more than 96 pieces of coverage, equaling 407 million impressions. The team secured coverage in major business and tech outlets, including CNBC, Wall Street Journal, TechCrunch, VentureBeat, Fortune, and Inc.
Did it have impact?
The CEO and CMO report that inbound inquiries from prospective customers increased by at least 50% after the announcement was made. Furthermore, they say the coverage also stimulated interest from potential partners and investors.
Making a splash all started with taking stock and having a well-executed strategy for transforming what many might see as just another funding announcement into something of lasting, sustainable value with significant ROI and bottom-line impact.
This article first appeared in Forbes.