Funding is one of the biggest challenges in the entrepreneurial journey. Navigating the world of venture capitalists and storytelling is no easy feat, especially when looking for your first seed round or a million-dollar investment.

Not to mention, against the backdrop of COVID-19 and a heavily disrupted investment sphere, early-stage founders now face an even more complex road to securing funding.

The business landscape has no doubt changed for good because of the pandemic; there are more opportunities to respond to new customer needs and get ahead of the curve for future usage trends.

Founders who know there is a clear appetite for their product or service and can showcase early growth may actually find themselves in a more favorable position to ask for more money. That said, much of the process is dependent on reframing the funding process and relationships with individual investors.

In the new conditions, here are my tips on how to reach your first $1 million investment or seed funding, a feat I’ve managed to do multiple times:

Rethink how you approach funding

I know it’s easy to assume that securing a round of funding is a signal that you’re on your path to success, but you may find the reality to be a lot different.

Fundraising should be considered a byproduct of your success — you have to already have a solid reputation and a genuinely valuable product or service to get funding in the first place.

I’ve seen many first-time entrepreneurs fall into the trap of thinking that a funding round is the equivalent of a major milestone. If you consider raising money to be the ultimate solution to your business problems, and funding to be the core metric for your progress, you’ll run out of steam pretty quickly.

My big advice: you have to shake this mentality as soon as possible.

For instance, if you host multiple funding rounds and bring on board a number of investors, you’re probably going to give away a lot of equity in the process. Of course, on the other hand, if you raise no money, you may discover that your runway is not long enough and quickly come into financial difficulties.

If you’re striving for a million-dollar investment, you need to view fundraising as an event to help you break even or be profitable. It should not be a needed lifeline for your venture.

The general rule of thumb is that you should have sufficient money before you start the fundraising process to facilitate getting an early version of your product or service to market.

Position yourself as a gap, not a gamble

Investment isn’t a luck game, it requires hard work. You, as the leader of your startup, have to convince investors that you are filling a real market gap and that your competitive advantage separates you from the thousands of other startups out there.

I’ve managed to make my first impressions impressive by showing my product has demonstrable traction.

That doesn’t necessarily have to be a huge revenue stream, it can be a sizable number of free trials, beta customers actively using the product and seeing value, or a letter of intent from a well-known brand.

These early wins are essentially your evidence that there is a real demand for your product. If you launch into an investment stage prior to having traction, you’re basically asking investors to take a gamble on you, as opposed to getting involved in a product with proven customer success.

So let me be clear: if you don’t have tangible successes (not even small ones), do not look for funding! None of the first $1 million I’ve raised as a founder would’ve been possible if I hadn’t had something to show.

For my current team at GrowthPlug, we were able to generate strong customer traction around the product and had scores of paying customers realizing a tangible ROI with the product. With paying customers and a profitable bootstrapped company, it’s a lot easier to get attention from investors.

Nurture your investor relationship

It’s only natural to put investors in a box; they hold a significant amount of power and can make or break a company. Still, an investor is a human being with the same interests as you — to see a business succeed. Just as you would with any other stakeholder in your business, it’s important to be candid and honest with investors, no matter what stage your relationship is at.

From the get-go, devote a good chunk of time brainstorming your product journey, customer success, and future roadmap with investors. You aren’t selling just what your company looks like now, you’re selling what it will be, and for that to effectively resonate investors need to be informed about the realistic trajectory.

Likewise, your struggles and challenges should be addressed so investors can prepare for the obstacles ahead — even better, they can connect you with people and resources that may be able to smoothen potential roadblocks.

Alternatively, you can utilize your niche communities to target specific investors you’re interested in talking to. Do your due diligence by researching and identifying investors who know the field you’re going after.

The more you have in common with the investor, the more they’ll resonate with your pitch, connect with you on a personal level, and be passionate about the problem you’re countering.

Follow degrees of separation to establish a trail between your network and the right investors. Try to find mutual common connections and request a warm introduction if possible. Chances are, if an investor gets a message from someone they know referring you, you’ll be in a better position to land a meeting.

Make your metrics talk

Similar to customer traction, there are certain metrics you need to present to secure a million-dollar investment. Without these metrics, there’s no real quantitative foundation for investors to believe that your projections are true.

Unlike smaller investment amounts, which may rely more on qualitative data or short sales cycles to generate quick ROI, an injection of $1 million will almost certainly require a detailed breakdown of core metrics.

Those include Total Addressable Market (TAM), Churn (monthly, annually), Annual recurring revenue (ARR), Cost of Goods Sold (COGS), Burn Rate and Gross Margin.

In addition to the above core metrics, here are the metrics that are particularly important for investors:

Customer acquisition cost (CAC) : how much it takes you to win a new customer. CAC can be calculated by dividing the total marketing and sales costs by the number of new customers.

Lifetime value (LTV) : the total net profit brought in by your customers over the full duration of their relationship with your business. LTV is calculated by multiplying the average purchase frequency rate with the average value of a customer’s purchases, then multiplied by the customer’s lifespan.

Cohort Analysis : great tool to deeply analyze churn/retention data over time. It breaks down the historical performance of related customer cohorts and helps a company to identify patterns across the journey of a customer.

Prepare for a marathon, not a sprint

Getting your first million-dollar investment or seed funding comes from building meaningful relationships with investors, and like any relationship, this process can take a good amount of time.

Most certainly you’ll have to speak with several investors before you find the right match (we’ve had to go through 20-25 investors before finding the right one), and then from that point, it could take months of back and forth to finally seal the deal — and that’s OK!

Putting pressure on an investor is a sure way to see them back out, while being too hands-off can seem unprofessional or disinterested. Keep your preferred investor on your radar, send regular updates about your startup’s journey, and don’t be afraid to share your core challenges and big wins.

Ask what their reservations are, introduce them to your team if asked, and be transparent about the things you’re still learning or consider as big challenges.

The worst-case scenario is that you don’t get the investment you needed this time, but you can still establish a valuable partner who can speak on your behalf with other potential investors or advisors.

Part of being an entrepreneur is being humble and embracing all opportunities to learn. Each investor relationship you form will enable you to uncover key areas of improvement in your pitch deck, rethink your product-market fit or shape the way you communicate your key metrics, and provide you with momentum towards the first one-million goal.

And when you do hit your goal, you’ll be ready to do it again and again.

My treadmill desk makes me happier and more productive — here’s why

I love my home office chair — deeply. It feels like sitting in a hug.

Before 2020, I would only see it a few hours a day. The rest of the time, I’d work in co-working spaces and coffee shops, which I walk to. It kept me active.

The pandemic changed that — my chair became part of my body. I coded there, I had meetings there, I ate my meals there, I happy hour’d with friends there, and I watched Netflix there. I rocked my whiny kids there. I did everything in that chair, and my body started to feel it.

We all know that exercise plays an important role in our mental and physical well-being. As a car-less city-dweller, losing the ability to walk around and leave my tiny apartment when the world started to shut down weighed heavily on my mental and physical health. And, as a mom who now had more than one full-time job, I just didn’t have time to dedicate to exercise.

So I bought a treadmill for under my standing desk. I knew I needed something to get me moving, and I needed to be able to do it while momming, working, or hanging out with friends on Zoom. I needed to get my butt out of that comfy chair and get moving.

It worked! I love this treadmill like one of my children, and I think you should buy one. Here’s why, and a few tips I have for setting up your own treadmill desk. Feel free to march in place while you read.

The benefits of a treadmill desk

So, why have a treadmill at my desk? I have a few reasons.

I can burn calories while I work. There aren’t enough hours in the day for me to work, parent, occasionally socialize, and work out. The treadmill desk lets me do two of those things at once, which makes me feel less guilty about all the Zoom happy hours.

I put less pressure on my back. Moving your legs can mean less pressure on your back than simply standing at your desk. Beware if you have existing joint pains, though — a yoga ball chair might be better in that case.

I feel better. You’ve heard it (and probably ignored it) so many times: exercise releases endorphins, which means you’ll feel happier. We all could use a boost these days, so don’t overlook the upside here.

There are more benefits, I’m sure, but wow do these ones stand out to me. It’s been life-changing.

When should you walk?

I don’t walk all day — I’m picky about it. Some tasks are better with walking, some aren’t. Here’s what works for me.

I walk during informational meetings. You know those meetings where you’re mostly listening, while occasionally sharing opinions? I walk during those ones, around 3.5 miles per hour.

I walk during simple tasks. Whether it’s planning my day or catching up on some reading, some tasks don’t require a lot of brainpower. That’s a perfect time to do some walking. I do around 2 miles per hour.

I walk during virtual dates with my friends. This sounds weird, but it’s wonderful — especially if your friends have treadmills too. Go whatever speed you want — it largely depends on if you’re drinking hot or cold beverages (I do not recommend sprinting with a latte).

This is going to vary for you, obviously, but the important thing is not to do it all day — you’ll get tired (and tired of it). I like to use it for less focus-necessary tasks: when it’s time to focus on coding for a while, I go back to my comfy chair. This might be different for you — maybe the treadmill will get you into focus mode, for example. You’ll have to define your own lines.

Tips for your new treadmill desk

When your treadmill arrives, and you start using it, there will be an adjustment period — there sure was for me. Here are some things I learned.

Warn your colleagues. You’re going to be walking during meetings, which will be jarring at first. Be ready to explain yourself (send them a link to this article, maybe?). Your coworkers might judge you a little, but that’s ok. They’re jealous and probably a little sad because, you know, lack of exercise.

Wear headphones. Your treadmill will be noisy. They just are. Make sure you’ve got good headphones, with noise-canceling, and that you wear them during the call. And mute yourself when you’re not talking.

Stay hydrated! Don’t overlook this one — drink water, constantly.

Mark your sweet spot. You’ll be pulling your treadmill out from under your desk quite often, and eventually you’ll figure out the exact place to put it. I recommend marking your floor with a little tape when you find that sweet spot. That way, you don’t have to constantly fuss with awkward or dizzying angles.

Take notes. Find your happy speeds and write them down, so you don’t have to experiment every time you start running.

Wear good shoes. I can’t overstate this: uncomfortable shoes are going to make this miserable. Wear something you’d wear for a long walk.

Get a portable treadmill. You need something that’s easy to tuck away when it’s time to sit again. You don’t want it to be a pain to roll out, or you’ll never use it. I slide mine under my desk. My partner tips his up on its side beside his desk. Find something that works for your setup.

I honestly love my treadmill desk — it makes every workday better. I hope you get one and also love it.

This article by Stacie Taylor was originally published on the Zapier blog and is republished here with permission. You can read the original article here .

6 fatal mistakes made by ad tech giants in the 2010s — and what they can teach you

During the last ten years we have witnessed the growth and flourishing of ad tech. Since then, many good things have been said about the roaring success of industry giants. Now it’s time to unveil their fails and learn our lessons.

We live in the heyday of recently-born advertising technology. Ads served automatically grew from 0 to 30 million impressions per day. And that’s only within Google Ads network — imagine the combined numbers coming from hundreds of other ad networks and demand-side platforms.

Every year something great happened. Real-time bidding grew from the method to sell remnant technology to the fastest way of buying high-quality traffic from trusted websites. Google, Facebook, and Amazon rose to their indisputable prominence. GDPR kicked in, and now customer’s privacy is valued over everything else. We switched to first-price auctions, and many more changes that gave a solid boost to brands that applied them wisely happened within these ten years.

What has been often neglected in ad tech talks are the epic failures that led some companies to collapse. At the dawn of the new decade, let’s review the most common mistakes made by ad tech brands to avoid repeating them in the future.

1. Inability to adapt

Unwillingness to change and lack of innovation are the primary reasons why once-great businesses failed, and not only in ad tech. No single company defines the market. It is the customer who defines the market, so even the trendsetters have to pivot on the fly.

In 2020, brands that ignore the importance of first-party data, personalization, audio programmatic, and wearables put themselves at risk. No client is loyal to the extent that they’ll stick to your services no matter how outdated they are.

Or, it might happen that your innovations were rolled out to a market that isn’t ready for them yet. An example of the wrong timing is the case of Videology .

The company started as a pioneering ad tech startup focused on video advertising when it was only in the bud. It quickly partnered with large ad buyer GroupM and made a bet on the ad network business model.

This, however, appeared to be a bad call in the long run, as the advertisers craved more control over their ad campaigns and began massively switching to self-serve platforms. At the same time, Videology was fixated on the GroupM partnership, which was preventing them from other collaborations.

Videology growth has stalled. They decided to lean into building tools for programmatic TV, which still hasn’t taken off yet. Nobody needed advanced TV advertising tools in 2016, and frankly speaking, few advertisers need them today.

The rest of the existing problems of Videology were linked to the mounting Google and Facebook duopoly. Google disallowed third-party companies from purchasing video ads on Youtube. Facebook flooded the market of short video commercials by acquiring Instagram and launching ads in stories.

We’re all suffering from the duopoly dominance. But there are still many ways to be a successful video advertising company — from building a self-serve video ad platform to launching outstream video ad formats . The question is whether you are ready to mobilize and adapt or not.

2. Scaling-up too fast

Despite its dire end, there is one thing that Videology did right. The brand focused on one single channel: video advertising.

Many young ad tech companies do the opposite. After reaping the fruits of their early achievements, they begin actively expanding and then launch new services under their brand name. They may start from video, but later they burst into other industry segments like mobile or even data management.

Such extra moves may or may not lead to extra success. But generally, the more streams of revenue you try to embrace, the more the risk that you won’t handle them all and back down.

In 2018, OpenX laid off over 100 employees and shut down its ad server . Instead, the company workforce focused on upgrading video and programmatic solutions.

An OpenX representative said: “We are now operating from a more streamlined organizational structure to enable us to continue to succeed in the market.” And indeed; now the company feels just fine, helping clients to increase their programmatic revenue through OpenX Exchange by 49% in 2019 .

The key takeaway from this case: If you feel that your business model is becoming too fragmented, refrain from further scaling up.

3. Wrong acquisitions

Have you ever noticed how people place tall and awkward structures in front of the buildings of historical significance? Take Altolusso , a residential skyscraper in Cardiff, placed behind the once-majestic Victorian facade of Cardiff Gas Light and Coke Co. facility, Bute Terrace. Instead of being demolished, Bute Terrace was turned into a joke intended to be a beautiful architectural ensemble.

That’s what I’d compare to “wrong acquisition.” Something attractive and seemingly profitable, but in fact it is destructive to your company image.

The ad tech industry is replete with acquisitions. Recently, Roku acquired Dataxu for $150 million. Salesforce acquired Datorama for $800 million. Sizmek acquired Rocket Fuel for $125.5 million. And while the first two deals were successful, the latter one turned out to be fatal for Sizmek.

Earlier this year, Sizmek met the fate of Videology and filed for bankruptcy. Experts named their acquisition of Rocket Fuel as one of the reasons. Rocket Fuel provided outdated and insecure Javascript pixels that slowed down pages and left them exposed to data theft. Even more, the DMP is notorious for selling data to third parties without user consent and pooling data from their clients’ remarketing campaigns.

Although this is not the root of Sizmek’s decline, this acquisition caused evident damage to their revenue. On the one hand, Rocket Fuel had powerful AI algorithms for data collection. But on the other — is it worth it to trade your own image for algorithms? Barely, at least for such a household name as Sizmek.

4. Lack of differentiation

The ad tech industry has one more global problem: The market is quite homogeneous. DSPs, DMPs, ad servers, and other advertising software share similar features and similar approaches to client treatment. They fail to make a difference.

If you go to the site of any ad tech company, you’ll see they all offer the same package in a different wrapping. Targeting, data collection, reporting, and the rest of the algorithms seem to work in nearly an identical way, with the only difference in traffic and inventory they provide. This mistake may cost not only Sizmek’s life but the lives of dozens in ad tech.

5. Partnerships with fraudulent DSPs

Worse than wrong acquisitions is unfortunate partnerships. Aside from running into another black box, you have zero control over your partner’s intentions. The global problem here is that along with the well-established players, there are promising new names whom you might like to collaborate with, especially if you’re also a startup.

Before rushing into this, you’ll have to weed out the wolves from the herd. Plunge into the ad tech environment, study each prominent and not so prominent name, and read credible sources of ad tech news. Fraudulent companies may disguise themselves as well-known brands in the industry, so knowledge is power here.

One of the recent fraud cases is Amobi Inc., which sounds suspiciously like the Amobee advertising platform. The difference is easy to overlook for an untrained eye, and Amobi took advantage of it, using a fake LinkedIn account and Amobee brand colors for their website.

Amobi Inc. got a chance to put their ads within PubMatic and OpenX networks before the programmatic audit company Ad Lightning detected the malicious nature of their creatives. The DSP distributed the Claritin ad, which was infected with malware and seeded it on hundreds of publisher’s websites before being eliminated.

Neither PubMatic nor OpenX were partnered with Amobi, but it’s indeed a possibility for starters. Newer ad tech brands may get caught in the trap of “premium traffic” and other tales usually told by fraudulent DSPs.

The quick fix is partnering with third-party verification services like Ad Lightning, which will identify the threat and root it out relatively quick. However, fraud is an undying issue in ad tech — staying wide awake still won’t guarantee you total defeat of this enemy.

6. Use of DMPs with declining cost-efficiency

Once-robust, the DMP (data management platform) sector of ad tech demonstrates some turbulence in recent times. 56% of marketers consider switching their DMP provider. 44% of them assessing this as a somewhat likely decision, and 12% — most likely, according to the Advertiser Perceptions report . 20% point out high cost as a primary factor for switching; 12% say that hidden pricing and lack of transparency have led to this.

This all means only one thing: DMPs are off their game. Marketers no longer see them as cost-effective data solutions. Features offered at exorbitant costs and separately from the demand-side platforms are labeled overspending.

Marketers are starting to move toward hybrid platforms that combine features of both DSP and DMP in a single interface. In 2019, 51% of advertisers were going to choose a hybrid solution over a pure DMP compared to 41% in 2018. This trend is predicted to gain momentum in 2020, so the overwhelming majority of marketers will likely flee towards hybrid DMPs.

If you’re an ad tech brand and plan to build a DMP, consider making a hybrid one, which is a much more viable product now than a pure DMP in a new decade. If you’re an advertiser or an ad network, don’t repeat the mistake of previous generations and be extra careful with your DMP spending.

Wrapping up

Now, the giant, complex, and unbreakable ad tech rocket is hurtling through space at the speed of light. We should remember; this rocket fits all of us, small and big ad tech brands, media buyers, publishers, and others involved in advertising. And as I mentioned at the very start, it’s driven by our customers.

The primary lesson to learn at first light of the 2020s is to listen to your clients. Fake trends pop up and sink, while true trends lie in the words of your customers. Implement what’s right to your audience, and you’ll stay afloat. The worst mistake any brand in ad tech can make is to pursue revenue over customer satisfaction.