Customer analytics start-up Profitably just announced a $1.1 million raise after more than nine months of pitches, demos, meetings and introductions. The moment was cathartic for CEO Adam Neary, who was moved to rehash the entire experience in a 3,000-word post on Profitably’s Tumblr today. ”I’ve read many blog posts by entreneurs who have raised money successfully, and honestly, I can’t relate to most of their experiences. Maybe our situation was grossly different, or maybe folks are glossing over their struggles and mistakes. Either way, I thought I would do my best to recount an honest and complete review of 2 very grueling rounds of startup financing,” he wrote.
Mr. Neary really made the rounds: he started at the Founder Institute (helpful on early advice, a liability when it came to raising money), then hit the North Bridge Venture Partners Seed Competition and some business plan competitions, pounded the pavement talking to angels, pitched at DEMO, pounded the pavement talking to VCs, spent two months being processed through the New York Angels mill (“clearly the New York Angels process is broken”), got $75k from AngelList (“a little underwhelming, but I am still quite bullish about AngelList”) and went back to the Founder Institute and Open Angel Forum, which were both unhelpful.
“By mid-January, morale was eroding and it began to seem like all our channels were exhausted, and we weren’t sure if we were going to make it to our $500k minimum for the round,” he said.
Then, boom, January. Profitably was one of the inaugural companies in General Assembly, which in a short time established a reputation as a place to see and be seen. Apparently, it’s also a place to fund and be funded.
“We’re ‘there’ when investors are walking around, talking to different teams. We’re there when potential partners are looking to collaborate. We’re there when Dave McClure rolls into town and wants to have dinner or when the NY Times is talking tech,” Mr. Neary writes. Profitably raised the supermajority of its round–$750k–through introductions made at General Assembly.
So what happened? Dozens of investors passed on Profitably’s meat-and-potatoes pitch. But the company zoomed to a deal once the team started landing introductions by proximity. Perserverence was a necessary ingredient. But contrast a personal introduction in the context of swanky General Assembly, surrounded by the glow of start-up darlings like Art.sy, SeatGeek and Yipit, to a coffee shop meeting or a noisy pitch competition, and it’s easy to see how Profitably’s fortunes changed so quickly.