What to Expect From VC Funding in 2021

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While this past year has brought with it a lot of uncertainty for small businesses, it also brought with it more venture capital funding. In fact, global funding last quarter hit an all-time high, marking the first single quarter to reach above $100 billion, according to Crunchbase News. VC funding is expected to increase in the upcoming months of 2021.

Throughout the COVID-19 pandemic, certain industries saw massive growth including health care, financial services, logistics, delivery, fintech and cloud computing. Businesses in these sectors were forced to adapt quickly and some that could not were replaced by startups looking for the perfect opportunity to enter the market.

While VC activity was initially reduced in 2020 due to the global pandemic, Forbes, writes that this gave businesses the opportunity to adapt to a changing landscape, encouraging a comeback for VC funding in the second half of 2020.

Even though the global pandemic has hindered our economy, it has also highlighted a lot of industries with potential growth opportunities that are worth investing in. As things continue to re-open and vaccines continue to roll out to the masses, there is more capital to be invested.

Here are some things you should consider when looking for VC funding in 2021:

  • It is vital to communicate your vision with venture capitalists in a remote environment. 

Being able to clearly articulate your vision for your business in a virtual environment is essential. There is less of an opportunity to connect face to face to get to know each other. You have to find a way to clearly and effectively communicate your vision and passion with the people you are hoping will invest in your business.

Here are some things to remember when delivering a virtual pitch from BrainYard:

Double Check Your Tech

Ensure you have a solid internet connection, the latest updates on your computer are installed and ensure you are familiar with the platforms you are using. If you are pitching on an audio platform like Clubhouse, ensure you have clear audio.

Pay Attention to the Visuals

Make sure to use good lighting with a clean background and ensure you have visually appealing slides if there is a deck component.  

Find Ways to Engage

Plan for a shorter presentation with strong eye contact, ensure you stand during the pitch, speak loud and clear, exude positive energy and connect on a personal level to keep VCs interested.

  • The technology sector is seeing (and will continue to see) massive growth.

With the rise of remote work and the increasing need for technology in our everyday lives, it makes sense that this industry is on its way to seeing incredibly strong growth. 

“The Covid situation forced everyone to move faster on ‘digital transformation,’” or technology-fueled changes to business process, business model, domain or company culture and organization, said Najib Khouri-Hadad, general partner at technology-focused Sway Ventures.

The technology sector will continue to see these trends for multiple years with the continuation of updated digital devices such as cellular technology, higher quality video, collaboration tools, 3D printing, VR technology and e-commerce.  There will also be a focus on businesses centered around security and data-reliability, particularly when it comes to applications and software development. It is safe to say that if you are building a business in the technology sector, you have a good opportunity to grow quickly and get funding from venture capitalists.

In a recent BetaKit article, KPMG’s partner and national sector leader of technology, media and telecommunications, Anuj Madan stated, “VC investment has soared to new heights, solidifying Canada’s position as an innovation hub that’s creating global disruptors.” This is only the beginning and getting ahead of the learning curve as to how to navigate the virtual and remote world of VC fundraising is going to be key. Venture capital funding is on the rise in 2021 and industries focused on health care, technology and logistics are getting the first look. 

Properly preparing for your first VC meeting will greatly affect your chances of success. There’s more to it than just expressing your vision for the company and promising a revenue chart that goes up and to the right. Investors need to not only understand your business, but also have faith in the company’s early leadership team. One of the best ways to impress institutional investors is to show that you can handle any questions and concerns they throw at you, so preparation is key.

If you are curious about how to prepare for your first VC fundraising, read this article we wrote. It will walk you through five ways to get your venture capitalists to say yes… and fast.

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