How to win deals as an emerging VC
Investing in early-stage companies at B37 Ventures and the journey towards our new Fund 2
“As a VC, bringing business development opportunities to startups founders doesn’t grant investment allocation in their funding round”
That was my first conversation with a top tier investor when I started my VC journey and joined B37 Ventures as an Associate Partner a couple of years ago. It was a bit of a shock. I was betting my career on a VC fund whose ability to get into highly contested deals was predicated on enabling great startups grow quicker and scale internationally faster. If that causal relationship didn’t hold, putting in the hard work to bring expansion opportunities to startups provided no upside as we wouldn’t be able to partner with founders for the long run and invest in their visions. Then, why did B37’s portfolio back then already have amazing startups, with truly exponential tech and world-class investors? For a young fund, getting into a hot deal goes beyond investing dynamics among VCs. It’s about contributing in a tangible and meaningful way to the startups’ growth journey. Less about perspectives, more about outcomes. A focused value proposition that resonates with founders. Have a thesis, put it at work, showcase results, bring value now, outline how that value can expand. Execute. Rinse and repeat.
What’s the secret sauce? — Changing the game in venture
B37’s superpower is engaging pipeline and portfolio startups within global corporations to validate product-market-fit and technology, develop enterprise sales aptitude and land them at sales qualified leads with champions within the corporations that have the budget, authority and urgency to innovate. We’ve attained global deployments for startups valued at millions of ARR, sometimes being the lever for the first enterprise customer or first global contract. We are able to do so through unique relationships within such multinational corporations in several industries who rely on us to curate early-stage tech pipeline against specific, budgeted and strategic business outcomes and use cases.
We are an early-stage SF-based VC fund focused on finding the best enterprise tech startups which we can help scale through our global network. We aspire to change the game in venture by providing business development opportunities from the first day we engage with founders. Our premise is simple: source the best tech, generate global deployment opportunities, accelerate and unleash valuations, nurture and sustain long-lasting relationships with our founders and co-investors.
Why the model works — a reinforcing flywheel that potentializes startups
Scale and scope: B37 is currently raising Fund 2. The operations of our current LP base of multinational corporations spans across 34 countries and different verticals (baking, dairy, water, manufacturing, mobility) with significant footprint in operational assets (250 manufacturing plants, 220k employees), logistics (70k routes, 2k logistics centers, 500M passengers/year), and commercial reach (4M POS, 15k products, 85M kg protein produced/year). The commercial opportunities for our pipeline and portfolio startups start with a single use case in a specific team within a corporation but have a material upside of global scalability. For Fund 2, we are seeking to onboard even more corporations from new and existing verticals that can materially contribute to the value of our platform (where startups and corporations exchange innovation and scale).
Network effects: Our pipeline and portfolio startups get access to multiple use cases and business development opportunities from a “single point of entry” and go through a consistent process in our platform that provides transparency and lowers uncertainty. We make sure startups get the full picture and access to all potential use cases from the multiple business units within a corporation and across different investors. Internally, we also promote cross-pollination of ideas to enable stakeholders from different corporate investors get educated on specific tech and success scenarios. This helps to shorten the innovation adoption curve, promotes risk-taking at various levels of the organizations and enables our startups to deploy faster.
Intimate company knowledge and curation: We are not technology brokers between startups and corporations. We are investors that succeed if we are able to materialize growth potential for startups in the form of large commercial engagements. To ensure this, we start from a desired business outcome or use case within the corporates that is directly linked to the strategy and relevant priorities. With the institutional knowledge of the problem — what needs to be achieved and how it will be measured — we are able to match and land our startups in an engagement where there is a true need for disruption and organizational readiness to execute. From then on, we ensure founders have as much visibility, support and the right communication channels and escalation mechanisms to set up their products and services for commercial success. We don’t want our startups to waste time and resources if we can’t find the right combination of business need, team executional readiness and right sponsorship at the corporate level.
Quick feedback loop: Startups are able to validate their Product-Market-Fit and Go-to-Market strategies by leveraging our platform. Our corporate investors have been the first international deployments for several of our portfolio and pipeline companies. Along that journey, they’ve gained invaluable information about which business levers are sought after in specific geographies and use cases. Quick interactions with the B37 platform, continuously inform and provide new information to their future product or service roadmap as the startups look to scale. The intimate knowledge we have about each of the corporations, their teams and the use cases also allow us to anticipate hurdles we’ve seen before and provide leverage to founders to address specific pain points from different angles. That feedback loop is value accretive to corporations as well — the more startups they engage with, the better they become at learning from past mistakes and adopting the right technologies sooner.
Tangible results: Our pipeline and portfolio startups have attained commercial global deployments in 20 countries, valued in tens of millions of dollars in total contract value, and have been able to accelerate their growth and funding velocity by increasing sales and expanding into new markets and use cases.
What’s ahead? — The journey towards Fund 2
B37 Fund 2 will definitely be an exciting and complex challenge. We’ll continue working hard on finding the best startups that can leverage our network and value proposition to significantly accelerate their growth path. A persistent focus on what worked and didn’t work from Fund 1 will allow us to better serve our founders in their 1-n journey. Awesome startups→ highly curated use cases with significant scale → quick feedback loops towards commercial collaborations → global deployments → rinse and repeat.
Personally, Fund 2 is an inspiring opportunity to continue evolving as an investor. Identifying and sourcing the best tech startups and efficiently allocating capital is only part of the equation. My goal is to build long-lasting relationships with amazing founders that will shape the future and provide a repeatable model that can help them catalyze their visions. Couldn’t be more excited!
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