Fundraising As A Sprint Vs Marathon: Student Edition
Fundraising is difficult for every startup founder, but fundraising while being a full-time student is uniquely challenging. Out of frustration with routing inefficiencies and a lack of transparency in school bus operations, Chris and I started, BusRight, in the Spring of 2017 while still full-time high school students.
In the Fall of 2019, we realized that we needed to raise a pre-seed round of funding to expand the team and make our company dreams a reality. To start the fundraising process, we referenced the article, Fundraising As A Sprint vs. Marathon, by Kendall Tucker, the founder of Polis, and now one of BusRight’s advisory board members!
While Kendall’s article along with advice from many full-time operators was extremely beneficial, we struggled to follow all the advice because of our status as full-time students. Ultimately, we had to balance competing priorities and prove to investors that we were taking the company seriously, even though we wanted to finish school.
I was sitting in my investments class when I got a call from an investor I pitched to that morning in a coffee shop on Newbury Street. Ducking out of the classroom, I answered the call and secured the final check for BusRight’s financing round while pacing up and down the 3rd floor of Dodge Hall. We managed to close our funding round in 7 weeks and oversubscribed 100% in two weeks after reaching our initial goal!
To give back to the community after this whirlwind process, I wanted to write a student edition of Fundraising As A Sprint vs. Marathon so that other student founders have advice/guidance as they embark on their own startup journeys.
Start in college
Whether it is for the 24/7 open library hours, available research from professors, or pro-bono legal services, the amount of resources available to student founders nationwide is infinite. We just have to be scrappy and search for them! Scholarship offices can help secure federal grants, research funding, fellowship programs, and other opportunities to help students with financial assistance as they develop their venture. BusRight was fortunate enough to raise over $70,000 in non-dilutive funding through this method. Even though we were encouraged to ditch the books and work on BusRight full-time, in-class learnings and on-campus leadership opportunities helped develop me as a leader, founder, and friend. So, take advantage of your .edu email address and soak up everything you can as a student founder!
Build an Aligned Advisory Board
Our philosophy for building the BusRight team was centered around coupling institutional knowledge with world-class technology talent. Our team has worked at a handful of the nation’s largest school districts, and our technology team previously worked for companies such as Google, Robinhood, and Tinder. In a market that’s antiquated, nuanced, and relationship-driven, it is crucial that we have people on both sides of the coin.
Ensuring we applied the same strategy for the BusRight advisory board, we wanted individuals with deep industry knowledge as well as experience building scalable technology solutions for underserved industries. With gratitude, I’d like to share that these folks are Polina Raygorodskaya (CEO of Wanderu), Turahn Dorsey (former Chief of Education for the City of Boston), Josh Starr (CEO of PDK International and former superintendent), and Kendall Tucker (Founder and CEO of Polis). These striking individuals have helped introduce us to investors, customers, and potential BusRighters.
Every team has strengths and weaknesses, and I knew we could not start this next chapter without a group of personal and company mentors. We were humbled to see how willing these industry trailblazers are to help the next generation of innovators.
Form relationships with investors!
While our formal fundraising adventure took place over 7 weeks, the actual timeline to build relationships with these investors occurred over a two year period. Through directing the Husky Startup Challenge, leading the Entrepreneurs Club at Northeastern University, and interning at MassMutual Ventures, we’ve built relationships with leading investors and entrepreneurs across the country. At such an early stage, investors are betting on the founding team. Make yourself personable and treat coffee dates equally as important as pitches. So here are my two cents: take advantage of that .edu email to grab coffee with people you’d like to learn from. For me, that person was Lily Lyman of Underscore VC. We built a relationship with Lily and the rest of the Underscore team through our participation in UFirst, an early-stage accelerator, and their initial funding put us on the radar of other investors in the early-stage technology landscape.
Prepare Fundraising Materials
Be prepared with fundraising materials packaged in a data room. Heads up for those who didn’t know like me, a data room is just a fancy word for the collection of documents investors could request during the diligence process.
What investors want to glean from your data room is how you think about the business. I had written a 20+ page memo on the BusRight opportunity before fundraising, a practice that helped me analyze the company from the lens of an investor. Within this memo, I wrote about topics such as key risks, investment thesis, hiring plan, loss-leader product strategies, and more. This memo was initially written for internal use only. It served as a central point for the team’s unbiased thoughts on the business, analysis of market trends, and hiring plan. Other documents that were crucial to our fundraising process included our cap table, short/long deck [for in person pitches use the long deck, and if sending over email use the short deck], memo, one-pager, cumulative Q&A sheet, relevant industry reports, and convertible note documents.
Update, update, update!
Keep the team, advisors, and investors updated on progress and blockers throughout the fundraising process. Whether it is sending a follow-up thank you email after each meeting or notifying existing investors when new money is committed, making this a consistent practice will allow you to capture mindshare from these busy individuals. Investors will always be skeptical of your time commitment in college. Keeping all stakeholders updated along the way will help ensure transparency and solidify your level of dedication — no matter what exam you have coming up!
“Universities are a talent pool yet to be discovered.”
As student founders, it is our job to spot fellow student talent before Facebook, Amazon, Netflix, and Google do. Attend events hosted by student organizations, be an active member in group projects, and ask professors who their hardest working students are. You want everyone on the team to be smarter than you so you can constantly learn from them.
BusRight was founded by two teenagers who met in high school — Chris and myself. Our education system is a platform to hire rising star talent — take advantage of it while you can.
On that note, BusRight is hiring! If you have any questions about my experiences shared within this article, simply want to chat, or are seeking new opportunities, feel free to fill out this short form or contact me anytime at keith@busright.com.
Other resources that were helpful to us along this journey:
