This has been a tough year for many startups that were king of their hill just a few years ago. The fundraising and acquisition situations we are seeing are incredibly stressful for founders, to say the very least. But whatever is going on, you still need a backup plan.
If you want to fundraise, you cannot rely on your existing investors needing to protect their position alone. If that doesn’t work out, you will need to pursue other options and it will be a lot easier if you make those plans early.
For acquisitions, it’s a similar situation as the outcome is far from guaranteed. It’s not enough to hope your company will close its sale or else simply shut down. You need to collect multiple offers, even if they’re bad; generate fundraising alternatives and even consider replacing yourselves if you’re ready to move on.
Reality is cruel and nobody is coming to save you. You need to give yourself multiple options. You need a backup plan.
Sterling Road invests in idea stage and pre-seed B2B startups based in the US, Canada and UK.
