Business

Let’s talk about raising capital in the pandemic

The pandemic and everything related to it has presented the industry with a variety of challenges, both for startups and venture capital mutual funds.

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Let’s talk about raising capital in the pandemic
Let’s talk about raising capital in the pandemic


  • According to ECLAC data, 500,000 formal businesses will not survive due to COVID-19, at least in Mexico, which equates to the loss of 1,573,000 jobs.
  • The pandemic and everything that has come with it has presented the industry with various challenges, both for Startups as an investment fund of Venture capital equally.

Today we find it difficult to understand that everything that happened before the pandemic corresponds to another historical moment. There was absolutely nothing with expressions like “healthy distance”, “pandemic”, world crisis, accompanied by insecurity and a disease that we don’t know when to get rid of, business closings.

According to ECLAC data, 500,000 formal businesses will not survive due to COVID-19, at least in Mexico, which equates to the loss of 1,573,000 jobs.

Naturally, the scenario for raising capital in Mexico and the world has changed radically for the US Startups.

The Networking, except for a new announcement

The pandemic and everything that has come with it has presented the industry with various challenges, both for Startups as an investment fund of Venture capital equally. Initially, because the meetings between entrepreneurs and investors, which are vital to the capital-raising process, are almost impossible, they are limited to the opportunities offered by digital media.

Image: LinkedIn Sales Navigator via Unsplash

If the Start up Good luck, you have the opportunity to interact with the investor right now and clear up any open questions or doubts from the investor. If it doesn’t (because the dynamics of the event don’t allow it) then you’ll have to be content with presenting a pitch and waiting for it in case the VC of what you’ve presented in that short amount of time , is concerned, the Fund should contact him.

In many cases it is Start up, don’t know who sees it, times don’t give the opportunity to do one Networking much warmer as in the pre-pandemic. Let’s not forget that these types of meetings were more likely to encourage such meetings than they were to look for investors. One after the otherThis is even more complicated when the Start up does not know the industry.

Industry behavior Venture capital in the pandemic

This situation has the growth of the Venture capital Referring to 2019, “The value of venture capital investments in Mexican companies is down a third this year compared to 2019, according to the Transactional Track Record (TTR).” This is not bad news, the funds have merely proposed strategies to counter the effects of COVID-19. Apparently, only the outcome of the investments made in the Mexican market has changed, although there are a greater number of companies that receive funding, the amounts were lower in 2020. According to the same source: “More than $ 500 million was invested in Mexico’s entrepreneurship ecosystem between January and September, a decrease of 34.5% from the same period last year; The number of transactions, however, varied as they increased by 16% to 72 (the study did not take Kavak lifting into account).

G2, a consultancy specializing in startups and capital-raising strategies, recommends addressing two key elements:

  1. Analyze the elements that you should highlight in yours Pitch deck This allows investors to understand that, given the nature of the presentations, you have a perfect analysis of the dynamics of your business at this particular point in time.
  2. If you have no idea which investors to turn to, where to find them, how to present your project to them, what elements to highlight, etc., you cannot guarantee a resounding mistake in advance. Join an expert.

Raising capital is not an easy task, you don’t get it on the first try (usually, and in this company’s experience), so you need to do proper planning with the right people in advance before you run out of money.

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