Welcome to the Thunder Founder Newsletter Issue #13!
You can expect us to share a new topic every week relevant to scaling your company and successfully fundraising!
Don't be that founder who fools themselves with misleading traction metrics
As a new startup, you want to prove to investors that everyone loves your product/service. However, you are still so early that there are only a few people who are actual customers. You may feel ashamed at your results when compared to the classic unicorn stories such as Uber and Lyft, and rely on alternative metrics that do look good. This may be metrics such as newsletter subscribers or followers on social media. The problem is that showing metrics that don't convert to sales will not only be meaningless to investors but will hurt your ability to acquire funding. No matter how impressive a chart is growing, if it does not generate paying clients, VCs will ignore it.
Instead, founders should focus on metrics that matter. These depend on the sector you are in but usually fall along the lines of revenue, customer retention, CAC, and LTV. However, the best way to achieve great traction metrics is to have great traction. Focusing on converting those free users to paying clients and building a long-term pipeline of future customers. This is perhaps the hardest part of building any startup, but it will make fundraising a lot easier.
Luckily, Thunder is hosting an event next week March 14 @ 1 pm ET with Craig Zingerline, founder of Velocity Growth, and will walk you through how to maximize your existing traffic to increase your traction and impress your investors. RSVP Here
If you're ready to raise capital, let us know and upgrade to Premium to unlock your targeted investor list of who will have a higher probability of investing. All premium clients receive a complementary consulting session with Jason Kirby, Managing Partner at Thunder.
What the Experts Have to Say
Business Traction: What It Is and How to Get It?
A basic overview of what VCs see as traction and areas of your company you can look at to measure traction. Read More
How to show traction in the pitch deck?
Once you have found the right metrics, there is an art in knowing how to present it in the pitch deck. Using the right method of presentation is very important for the VC to understand easily. Listen Here
How to Show Traction Pre-Revenue
No sales? No problem. There are plenty of ways you can show traction before earning any revenue. However, you need to make sure you are tracking relevant metrics. Read More
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Written by Jason Kirby - https://www.linkedin.com/in/jasonrkirby
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