This is the third post of a series about Talend’s recent Round C Fundraising.
Previous Post: Fundraising in September - Face Time

As the financial crisis accelerated, we continued our Roadshow all over the world. Our news was good. We closed a very interesting Q3 in terms of results and in terms of growth. And our news flow was excellent in terms of the press, analysts’ white papers, and quarterly results; all this validated our pitch to the VCs.

In October, all the VCs were evaluating the impact of the economic situation on their existing portfolios. Sequoia Capital and Kleiner Perkins, the two biggest names in venture capital, were both on track to fund less than half the number of companies that they did in Q3.

At this point, every single one of the VCs we were talking to had a new question: how does your value proposition address the new reality of a tanking market. For the first time we had to prove that our market space and strategic position had a delineable future. In September, nice-to-have was sufficient. Just one month later you couldn’t raise money with nice-to-have. The perception of value had moved to another level.

We were able to address this very quickly by actually leveraging the market downturn. We never changed our pitch, but we positioned it against the gathering storm. Frankly, if we weren’t open source we wouldn’t have raised a dime.

The downward spiral continued. October 6th launched the worst week for the American stock market in 75 years. The Dow Jones lost 22.1%, its worst week on record. Standard & Poor’s 500 Index - down 42.5% from its own high in October 2007 - also had its worst week since 1933. The economy continued to shrink and the word “Recession” became more prevalent.

Bertrand

Next post: Fundraising in November - Inking the Deal

This is the second post of a series about Talend’s recent Round C Fundraising.
Previous Post: Reflecting on our Recent Series C Fundraising - Introduction

The beginning of this process is usually very complex - getting the first appointment, getting a chance to pitch. After months of preparation, we officially launched the road show in September.

First, we contacted VCs that we’d worked with before and invited them to hear our story. And then Fabrice, Marc (Brandsma), and I went out on the road. Throughout September, we criss-crossed the country, with a few quick trips to Paris and London thrown in. We compressed around 50 meetings into 4 weeks, taking between 5 and 8 meetings per day. We were severely jet-lagged.

At the same time we were closing Q3 business, so we needed to optimize our time on both fronts. It’s really helpful to have hard deadlines, even if they’re self-imposed. If you compress your time, you optimize your time. It’s best for both sides to work quickly. Does the VC understand the value proposition? Yes or No. And on to the next.

We had a lot of success with the VC community. 99% of the VCs I talked to were interested in our market, our positioning, our open source model, our growth trend, and our management team. We were very encouraged.

September was the month it became evident that the economy might be in serious trouble. In the U.S., the sub-prime mortgage crisis surfaced with the Federal takeover of Fannie Mae and Freddie Mac. Lehman Brothers closed its doors after 158 years, reporting a $4 billion loss and filing for the largest bankruptcy in U.S. history. The term “Black Monday” appeared again in the news for the first time in 21 years. And the Federal Reserve and central banks in Europe and Asia pumped $180 billion into money markets in an attempt to free up a lending freeze between banks

We noticed alright, but still thought that this was probably a glitch in the system and that the economy would quickly get back on track.

Bertrand

Next Post: Fundraising in October - Leveraging the Market