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What Houston startup founders looking for funding need to know about working with VCs

Raising funds anytime soon? Take these tips from a venture capital insider into consideration. Photo via Getty Images

I have had the incredible opportunity to work with New Stack Ventures as a venture fellow, and after sourcing investment opportunities, shadowing calls with founders, and even leading a couple calls of my own, I have learned a few lessons that might resonate with startup founders who are raising capital.

Responsive founders make a difference

The first and likely most important lesson I have learned during my tenure as a fellow is this: responsive founders truly make a difference in whether or not they raise capital.

I have sent several emails and LinkedIn messages to really intriguing companies, in hopes of connecting for a call and inquiring about their raise. And, I look back and see that many of those outreach messages were left unread. I have also engaged in calls with really intriguing companies where the founder never follows up, and the idea of moving forward with next steps dissipates.

On the flipside of the forgetful founder, I have also witnessed extremely attentive founders: founders who send follow-up messages when they don't receive an immediate response, respond to their emails within the hour, and go above and beyond by sending pitch decks and executive summaries (even when unasked). This type of founder persona excites me with their enthusiasm and eagerness to make a deal. Their responsiveness with the investment process sheds light to how they likely run their businesses.

At the end of the day, many founders can say that they are hustlers and go-getters, but I believe the founders that show me through their actions in the investment process.

Great founders are great storytellers

When I do connect with founders in introductory calls (after the back-and-forth, hopefully responsive email exchange), the thing I look forward to most is hearing their stories. I want to know your story. I want to know what you were doing before your startup (and how that helped prepare you), how you thought of your idea, how you validated your assumptions, how you grew your business, and… everything in between (but all in less than five minutes of time).

Great founders are great storytellers. The great storytellers I have come across invite me into their companies' journeys, and leave me actually caring about their success.

On the opposite side of the spectrum, the founder who gives short responses and shows no real connection to their work (giving off the vibe that this is just another startup for them) leaves me unattached to them and their business.

Venture capitalists are more accessible than you might think

Perhaps, I gave this point away when I said that I was sending several emails and LinkedIn messages to founders (which sounds a little desperate), but VCs are way more accessible than you may think. Before working with New Stack Ventures, I had this perception that VCs were extremely hard to reach, exceptionally busy, and a little bit scary. And while one of the two latter characteristics still remains true, I can say with certainty that VCs are not hard to reach.

I can't speak for everyone in venture capital, but I do know that the VCs I work with will respond to founders who message them. Putting yourself out there, as a founder, can lead to advice (which bodes well for your business), a new connection in the industry (which bodes well for your network), and even an investment (which bodes well for the future of your startup). In the end, VCs are spending hundreds of hours, searching for a tractable startup that will change the game, and your startup could be the very gem they are looking for.

So, be bold, be responsive, and tell your story to any and every VC who will listen. I'm all ears.

Note: I was inspired to write this piece by by The Full Ratchet's tips for fundraising entrepreneurs, I thought I would share.

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Christa Westheimer is a Rice University student and the managing director at Rice Ventures. She is a current venture fellow at Chicago-based New Stack Ventures.

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Building Houston

 
 

There's a lot of clean tech potential in hydrogen — and Houston might be the place to lead the way. Image via Getty Images

Houston, known for being the energy capital of the world, has potential to lead innovation within the hydrogen space, and a new report lays out how.

The report, which was released today by the Center for Houston’s Future, is titled "Houston as the epicenter of a global clean hydrogen hub." The information explains how Houston-based assets can be leveraged to lead a global clean hydrogen innovation.

“The Houston region has the talent, expertise and infrastructure needed to lead the global energy transition to a low-carbon world. Clean hydrogen, alongside carbon capture, use, and storage are among the key technology areas where Houston is set up to succeed and can be an example to other leading energy economies around the world,” says Bobby Tudor, chair of the Greater Houston Partnership’s Houston Energy Transition Initiative, in a news release.

Together, GHP's HETI and over 100 experts representing 70 companies and organizations produced the report, along with McKinsey and Company, which donated significant research and economic analyses. Here are some highlights from the study, according to the release:

  • Clean hydrogen production could grow 5 times over current hydrogen production by 2050.
  • The establishment of a clean hydrogen industry could create 180,000 jobs (direct, indirect and induced) statewide, while adding $100 billion to Texas' GDP growth.
  • Globally, a Houston-led clean hydrogen hub could abate 220 million tons (MT) tons of carbon emissions by 2050.

“This report gives additional weight to the already strong case that Houston is uniquely positioned to lead a transformational clean hydrogen hub with global impact,” says Houston Mayor Sylvester Turner. “We can also deliver economic growth, create jobs and cut emissions across Houston and the Gulf Coast, including in underserved communities.”

The Houston region already produces and consumes a third of the nation’s hydrogen, per the release, and has more than 50 percent of the country’s dedicated hydrogen pipelines. These assets can be utilized to accelerate a transition to clean hydrogen, and the report lays out how.

"Using this roadmap as a guide and with Houston’s energy sector at the lead, we are ready to create a new clean hydrogen economy that will help fight climate change as it creates jobs and economic growth,” says Center for Houston’s Future CEO Brett Perlman. “We are more than ready, able and willing to take on these goals, as our record of overwhelming success in energy innovation and new market development shows.”

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