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Last updated Jun 1, 2023

The investment memo that helped us raise $60M in 10 days.

Written by Thejo Kote
4 minute read

We recently announced our Series B fundraise of $60M. That brought Airbase’s total funding to $91M. I was fortunate enough to sign the term sheet with Menlo Ventures 10 days after I started the fundraising process. A key part of that process was an investment memo (shared below) that I used to tell the Airbase story.

Airbase is the second company I’ve founded. My experience with raising venture capital was very different with my first company — it was a slog every step of the way. But, it was also an incredible educational experience in what it really takes to raise money from high-quality investors.

Thejo Kote


How Airbase raised $60M in 10 days.

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In this post, I want to focus on one important lesson about how startups should tell their story to investors. There is lots of very specific advice out there about how pitch decks should be structured, how many slides they should have, the important elements you should communicate, etc. But, I’ve learned that telling a good story about your startup is so important that you should pick whatever approach suits your business and unique strengths as a founder.

Fundraising is at its essence an exercise in story-telling. You’ll be far more successful if you tell a compelling and credible one.

I’ve found that my thinking is more structured when I write down my thoughts and I best communicate complex ideas that way. So, when I had to tell the story of the business we’re building at Airbase to investors, I naturally gravitated towards writing it down for them in the form of a memo. My thinking was simple — if a potential investor can’t spend the time to read a 10 page memo before making the decision to invest millions of dollars in Airbase, I know I don’t want to work with them. Sharing the memo very early in the process with investors also had the following benefits:

  • I did not have to spend a huge amount of time explaining the nuances of our business, like the product principles we value and competitive differentiation, to every investor. It was all covered in the memo.
  • It gave investors the opportunity to self-select themselves out of the process once they understood the business in more detail, and one firm among the few we engaged with did. Not everyone has the same thesis you do about a market, and the sooner you figure that out the better. The goal is to spend more time with the people who agree with your opinion of the market opportunity.
  • You get to share your story on your terms. Doing that is much harder when you’re trying to walk a group of people through a set of slides. If investors come to a subsequent meeting having read the memo, you can have a much more substantive conversation about just the areas that they still have questions about. 
  • Any VC firm that wants to give you a term sheet has to write an investment memo internally as part of their process of convincing all the stakeholders. You’re doing a lot of their work by writing a memo and likely ensuring that your story is being told the way you want.

By the way, writing a memo isn’t just a good idea for $60M growth rounds. In my first startup, we raised a $1.5M seed round of funding with a story around being a software company. Soon after closing the round, I decided we needed to add a hardware component to succeed. That was a big shift in strategy and I was nervous about whether the investors would want their money back. I wrote a detailed memo laying out my case for why I thought we should build a hardware device and shared it with all the investors. Luckily, they all agreed with me and not a single one asked for their money back! I’d like to think the clarity of thinking in the memo helped, something I may not have been able to communicate as successfully if I tried to have a conversation with every one of them, or created a slide deck where brevity is the goal.

I’ve focused on the fund raising process for venture funded companies here. Raising venture capital is not the only path to success. Certain markets demand that you invest aggressively ahead of revenue growth and Airbase happens to be in one. But, I think the discipline of writing down the story of your business can help every company at every stage. If you’re a founder on a startup journey, I hope this slightly redacted version of the Airbase Series B investment memo helps you.


To learn more about Airbase, contact us for a product demo.

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