How to Handle a Startup Funding Announcement

Most startups are funded by Venture Capital or Private Equity firms. This helps them build complex products independent of customer revenue, so they bring new concepts to market or even create entirely new categories. The aim is that the early investment will pay back in multiples later in the company’s lifecycle. In general, VCs invest in earlier-stage companies, and PE firms tend to come in later (C-round+) when they can deploy more capital against a lower-risk investment. These investors get their return when the company is acquired or goes public (IPO).

Early-stage startups are typically classed as Seed stage to B round, and late-stage startups are C-round and beyond (often up to D, F or even G, though companies tend to stop communicating that at the mezzanine level). There are even earlier investors, such as angel funds and individual investors at pre-Seed, but companies at this stage are focused on building v1 of their product, so they don’t often announce it.

For a startup, securing funding is a significant milestone. It’s a sign that external professional investors have validated the business, its products, and its management team. It’s also a chance to get a corporate story about the company, demonstrate traction, and signal intent with a war chest of funds to deliver it.

For all these reasons, startups, their investors and their respective public relations teams want to create funding announcements that are both memorable and newsworthy.

But not all funding news gets top-tier coverage. There are just not enough reporters covering startup funding to write about every transaction. It’s competitive. And as in all things startup-related, you want to win.

So, let’s talk about how to announce startup funding in 2024. 

How to announce a funding round

Every fundraise is different, but having announced over 50 rounds, here’s how we see the broad process:

Messaging

If this is the first time you are announcing funding, or the company’s debut, it might be the first time you’ve written down your corporate messaging. Take the time to go through a messaging exercise that describes the company, its opportunity, its value proposition, and what makes it different. You do not want to be working out the messaging by writing the funding press release. It’s amazing how, even within a startup, there often isn’t alignment about what the company is trying to build or why. Sometimes, investors have a different vision about where they see the company going. Get this all worked out by creating a “messaging house” — vision, mission, description, value proposition, differentiators, proof points, strapline and boilerplate. There are plenty of frameworks for messaging, and it will certainly change as the company evolves. The critical thing is to codify your messaging at this moment in time, so everyone is clear about what you are going to say when you unveil the company to the world.

If the company has announced funding before, this is the time to update your messaging and evolve your story. You’ve already debuted the business. With this new round, how have things changed (customers, products, partners)? What possibilities will the new funding open up? You need to move the story forward and give the reporter something new to write beyond the mere details of the transaction.

Remember, the reporter is not a prospect. The messaging here is not sales messaging. It is the company narrative that makes it topical. You’re not trying to communicate features or benefits but the corporate story — how this new chapter in its history should be written. You will dramatically reduce your chances of success if you try to sell the product to the journalist. They aren’t buying.

Funding press release

Announcing startup funding does warrant a press release. Funding is a corporate milestone that deserves formal recognition. Use your messaging to draft a press release that includes the funding amount, investor names, the round designation (A, B, C, etc.), an overview of the company and its proposition, traction and proof points (ideally including named customers), total funding to date and what the funds will be used for (most say R&D, increased sales and marketing, international expansion). The release should include a quote from the CEO and the lead investor. If you have several investors, at least name them as participating in the round. Try to avoid a long series of investor quotes. If necessary, create a “quote sheet” at the end, beneath the running copy. It is highly unlikely anyone will be insulted if the lead investor gets special placement. A customer or analyst quote is entirely appropriate — even desirable — in the main copy. 

We tend to advise including only the startup’s boilerplate (company description)  and at most that of the lead investor at the end. Including the description of every entity that has participated  can get comically long, increase wire fees and introduce other elements that need last-minute changes. 

If you can include them, growth metrics and post-money valuation will greatly improve your chances of coverage. Startup reporters will ask, so even if you don’t include this information in the release, you should know what you are willing to reveal. 

Deciding whether to disclose or not is always a trade-off. Disclosure makes funding news more attractive (and national business reporters might require it as a “cost” of coverage), but you might prefer to keep the details private rather than trade them for coverage. Companies often keep valuations private until they reach $1bn, but there’s no one right answer. Know that if you do reveal your valuation, it will come up again in subsequent rounds.

You do not need the release to be finalized before you start pitching, but it should be substantially complete. The basic facts of the round (amount, nature, investors) should be locked before you start pitching. Quotes are less sensitive, but you should never send a reporter a quote you wouldn’t want to see in print. Better to wait for an approved quote than send something half-baked as a placeholder  

Investor liaison 

Your lead VC will likely want to review the entire press release. They should certainly approve their quote. Most will leave the actual copywriting to the portfolio company, but others are more active in voicing their opinions and getting hands-on with edits. It’s a good idea to connect with the VC’s marketing partner early in the process to get a sense of their approach and what support they like to provide. Ask whether they have particular reporters the general partner is close to — that information can help refine your media outreach plan.

You will also want your investor to know the timing of your announcement so they can amplify coverage on the day. Many VCs will publish a blog post explaining their investment thesis and expressing their hopes for the company. Some also produce video interviews with the General Partner and the startup’s CEO. At the very least, they will want your logo and description for their Portfolio page.

From the startup’s perspective, it might seem the more the VC is willing to help, the better. But it’s also essential to avoid a “too many cooks” scenario. Remember, this is your announcement. Your investors can help boost your result and amplify your news — even level up with the media — but you need to have your hand on the tiller. In our experience, VC marketing teams are more than happy to have the portfolio company lead — and often insist.

Funding media outreach

Let’s talk briefly about media strategy for funding announcements. Broadly speaking, you have two options: an exclusive or a wider announcement under embargo. With an exclusive, you are giving the news to a single reporter in advance before it is put on the wire. This increases the value of the story for the journalist since they are the only one to cover it. The hope is that they will give the news a deeper treatment as a result. In a competitive space, or at a time when there is a lot of funding, an exclusive increases the chances of the news being picked up at all. The advantage of an exclusive is that you pretty much know you will get covered on the day (though in PR nothing is guaranteed — people get sick, stories get pulled by editors, etc). The disadvantage is that you will generally see only one feature story in one publication at the time of the announcement. 

Exclusives are exclusive. You can’t give the same information to another reporter without their knowledge. You can say that a specific reporter is the only one to get an interview with the CEO or high-profile VC to increase the appeal, but you must be clear that only that element is exclusive. There’s just no way of slicing this — if you give the news to someone else as well, the reporter will find out on publication, and your relationship will be over, potentially with the entire publication. (And potentially for the PR firm, too.) So exclusives are great to secure a top-tier piece of coverage — but it’s just one strategy. One big point in favor of an exclusive is that if a reporter accepts the offer, they are, in most cases, agreeing to write — not just to look at the news, but to cover it.

The second strategy is to “pre-pitch” multiple reporters with the news. We call this “going wide.” This is typically under embargo as well (meaning in advance, with their agreement not to publish the details until the embargo lifts). The advantage of this strategy is that you can get multiple pieces of coverage on the day, perhaps in the business press and trades. The disadvantage is that since many outlets that cover venture funding are competitive to an extent, anyone, or all, may decide not to cover it. There’s no commitment from a reporter to actually write, even if they accept an embargo. You may get some signal if they ask clarifying questions or do an interview. Even then, they may pass or get pulled onto something else. So you may get multiple hits — or zilch. At least, nothing substantial beyond the roundups.

If you pitch multiple reporters, it is imperative to provide no detail about the funding — especially amount, lead investor and valuation — until the reporter agrees to the embargo. If you send details before a reporter agrees to the embargo, they have every right to publish the news right away. Most won’t go that far but may very well tweak you on social media. You don’t want to take the chance.

Here’s a summary of the pros and cons of each media strategy around a funding announcement:

• Fewer outlets may cover news if it isn’t seen as special, or other news takes precedence
• Reporters will feel less obligation to keep you informed of their coverage plans
• Articles may be briefer than with an exclusive
• Higher chance that the embargo may break  (when a reporter publishes before the agreed time, whether by mistake or “mistake.”
• Updated press materials must be forwarded to multiple parties – and receipt confirmed
• Changes to publication date and/or time require agreement  of all parties under embargo
• Due to lack of communication, you may not realize that no reporters plan to cover your news, leaving you with zero coverage on the day

Deciding which strategy to take is one of the things that changes from week to week. When you handle many funding announcements, you get a feel for which is best, what might warrant the risk of a broad strategy, and who to pitch an exclusive to for the best coverage. 

As a little history, before the pandemic (2008-2020), it was very common to have a go-wide strategy that would frequently secure 10-15 pieces of coverage. There was little incentive to go for an exclusive unless you wanted to break into a really top-tier outlet, or were concerned about the news leaking or an embargo breaking. While the tech trade press was in decline before the pandemic, there were still plenty of options for funding news.

During ZIRP (zero-interest rate period), funding news changed. On the one hand, a lot more funding was happening (remember the zero-day close?), so competition was high. At the same time, many outlets folded as advertising dollars moved to social networks and alternate revenue sources from events dried up. So, we saw a lot more exclusives to increase the value of the news to the reporter and at least get “something.” At the same time, you often saw Seed-stage companies hold their funding news and combining it with their A-round, since Seeds were just too common and too small.

As soon as interest rates started to rise and funding levels dropped off in Q3 2022, competition was lower, but there were fewer rounds to cover. Reporters moved to analysis of the trends. There were fewer reporters covering routine funding news, but it became somewhat easier to get the attention of those who were. We are just coming to the end of, let’s call it, the Higher Interest Rate Period (HIRP). If the investment levels tick back up again, there’s going to be more competition — and we’re likely to see exclusives stay the default.

How far in advance should you pitch funding news? 

Let’s talk about how far in advance you need to pitch your exclusive or embargoed funding announcement, because it’s longer than you might think. During ZIRP, with so much funding, reporters at TechCrunch were booked up three or even four weeks in advance. It’s a little less now in 2024, but you should still factor in time for a reporter to get to your news since there are others in front of you.

If you are pitching an exclusive, you need to pitch reporters in series (one at a time), and you need to give them 24-48 hours to respond. People are busy; they get sick; they miss your email; they get distracted. So working back, you need to allow at least three weeks to pitch your exclusive to give you time to move through a few options and for the reporter to be able to cover it. The more time, the better for many of them (though top-tier business publications tend to work on shorter deadlines since they don’t want to be scooped and are set up to work at pace). Startups are often surprised that there are three weeks of pitching and want that to be done faster — it can, but it’s not ideal. Set yourself up for success here by starting the whole process early. 

On the day of the announcement, the press release will cross the newswire (we recommend 8:00 am ET/5:00 am PT) and you’ll start pitching all the other press on the list. The exclusive story will be published (not always at the same time as the embargo lifts), and you should share it on social media, post it to the newsroom, and put it in your email blast. Amplify that article as much as you can — it’s the main one, so get it in front of your audience. 

Several outlets, such as Fortune Term Sheet and Axios Pro Rata, will cover the fundamentals of the transaction, so make sure you include those on your day-of list.

Photography

You should offer reporters ahead of time professional headshots of the management team and, ideally, group shots of the founders. If you prefer to have a photo of the entire team, that’s fine too. Reporters may not use these, but you can have them for the website, and give them to your investors for their blog posts.

While on this topic, produce some good screenshots that showcase key features of your product. A “marchitecture” diagram might be appropriate to convey the workflow, where your tool fits into the ecosystem, or how it replaces other products in a workflow.

Blog post and social media assets

If you are wondering how to announce funding on social media, you are not alone. On announcement day, it is a good idea to publish a blog post from the CEO giving the backstory about the company, thanking the team, welcoming the new investors, and laying out what will come ahead. This adds more color to the details of the transaction and is a chance for the CEO to show their vision and personality. Some startups produce video assets such as an interview, a hype video, as well as social media posts to give the team some materials to share. You might also want to line up an email blast with the news release, coverage and blog post to directly tell your customers, partners and prospects.

Website and Conversion event

The funding announcement should drive more traffic to your site. If you are coming out of stealth with a new website, it is fine to publish it 24 hours before the announcement for testing and propagation. Often at this stage, developing the website is actually the deliverable that dictates the timing since it can take eight weeks to create even a simple site.

You will want to be ready to convert the increased traffic — we’ve seen 3-5x more traffic on the day for some startups. This means you might want a new guide, ebook or other lead magnet with full conversion tracking ready for visitors who are higher up in the funnel and not ready for a demo request.

On the day, make sure the press release is available, add new VCs to the investor section, publish the blog post and make any other changes linked to the funding news (sometimes board directors, perhaps a new product offering goes live). An announcement bar or some callout on the homepage is common.

Funding follow up

In the days after the funding announcement, there are other opportunities to talk in more general terms about the funding environment, round-ups and related stories. You’ll want to gather up the coverage to report to your board, specifically the VCs, and update directories like Crunchbase. In short, the funding announcement doesn’t finish on the day, so now is the time to wrap up those activities.

Most importantly, having got the attention of new stakeholders, what is the next story you are going to put out there? Have one or two follow-up announcements ready so you use the funding as the start of the next big PR push, and not just a blip of awareness followed by silence. At the very least, you can do more rapid response to media inquiries, thought leadership, award entries and increase the organic posting cadence to show the company is following through on its intent.

How long does it take to announce funding?

It takes 5-7 weeks for the complete process surrounding startup funding announcements. Of course, it can be done in short order, but let’s do a workback plan:

• Messaging: two weeks to talk to all the stakeholders, codify it, pass it by the management team and make any edits. If this is already done, we can obviously skip this step. A full messaging exercise, such as talking to customers, partners, etc., will take much longer.
• Press release: two weeks — one to draft and get internal approvals, and another for reviews with third parties such as investors, analysts or customers. It might not take this long, but don’t plan for the best case.
• Media outreach: three weeks — one for media pitching, one for the reporter to write their article, and one for contingency. Again, this can be as short as one week total, or you can even pitch it cold on the day, but that’s not advisable, given current opportunities and schedules.

So that gives us five weeks if you have your messaging and seven to include the messaging refresh. If you are bringing on a new agency to deliver this, you might want to add a week to select one and a week to onboard them.

This is more time than many startups have, so the reality is that it gets done more quickly, but understand that means condensing some of these stages.

What is a Form D? 

Form D is a filing that companies must make to the SEC for the sale of private equity, recording an exception to the Securities Act of 1933. The exemption is under Regulation D, so sometimes the notice is referred to as Reg D. The filing lists the company, the investors, and the amount of the investment — namely critical facts in your funding announcement. The filing is public and searchable online in EDGAR.

Some venture reporters and funding tracking databases monitor EDGAR for submissions and then report them. These are necessarily bare-bones articles, but they do appear in the public domain and can trigger other coverage, or spike well-planned embargos. Startups can’t ask reporters to hold an embargo on information already public in a Form D.

The Reg D filing must be made 15 days after the investors’ commitment to purchase the securities (not necessarily when the cash hits the bank). So for PR purposes, once the deal is signed, the clock is ticking. 

During the ZIRP period, there was so much funding the Form D filing wasn’t particularly an issue — it was hard to get your story covered, and overwhelmed reporters were not overly concerned about getting scooped. During HIRP, there were fewer rounds, but also fewer outlets tracking them, and it was less common for reporters to be monitoring EDGAR in the hopes of scooping a big round from a high-profile startup.

Today, there are some signs that Form D filings are getting tracked a little more, such as this piece in TechCrunch, but it can’t be called a trend. At the same time, the mechanism of funding rounds with convertible notes such as SAFEs, longer closing times resulting in multiple Form D filings in the same round, and round extensions mean that Form Ds may not capture the round at all, or not its full extent. So they are not as reliable a gauge of funding as they once were. But Regulation D is still in force, so the risk is there, however small.

Do you need a PR firm to announce funding?

Given the complexity of the process and the importance of a good outcome, many startups engage a public relations agency for support. It isn’t essential. Some startups opt to handle it in-house or get support from their venture partner. But beyond the question of whether they have capacity to do everything that needs doing while funding is in the process of closing, startups often lack fluency in the timeframes involved, which reporters to pitch, how to position the round, how to prepare for interviews and how to handle the myriad other issues that inevitably come up during the process.

How much does it cost to announce funding?

Getting agency support to drive the funding announcement will cost from $8,000 to $15,000, sometimes higher, depending on the messaging required.

What can go wrong when announcing funding?

Lots! We have seen all of the following:

• The deal takes months longer to close than planned 
• The lead VC pulls out
• New VCs come in the night before with extra funds
• The reporter falls sick
• The reporter takes the exclusive then goes incommunicado on an unannounced vacation to another continent
• The reporter leaves the publication
• The reporter accepts the embargo but doesn’t publish
• The exclusive is published days after the embargo time
• The company is acquired the day before the announcement
• No reporters are interested in the story for no discernible reason
• A reporter breaks the embargo
• The date must change since the website isn’t ready
• The story is leaked
• The CEO does a surprise interview with another reporter despite placing an exclusive elsewhere
• The investor and CEO don’t agree on the positioning or vision

Taken individually, these instances are rare. But funding announcements rarely go as planned. Something unexpected always seems to crop up. Wrinkles in the process are the rule, not the exception.

What can you do if you don’t like an article a reporter has published?

The big difference between sponsored content and “earned coverage” is that you, the subject, have no real say over the final product. That’s what makes earned coverage valuable. The reporter’s independence gives their coverage the stamp of prestige. Otherwise, it’s simply advertising.

The downside, from a marketing standpoint, is that every article, no matter how positive, contains wording you might not have chosen, or might not even agree with. You can request corrections for errors of fact. You can’t, in good faith, ask a reporter to change language that reflects a difference of opinion or interpretation. Nor can you really “take back” statements made in an interview unless the reporter is unusually accommodating. Equally, if you don’t like the image (and some can be very random), there’s little you can do. Note that reporters don’t always write the headline or get input into the artwork, so it’s often out of their control.

Many reporters are very happy to correct the amount of funding, the spelling of names, and misunderstandings about a product. But if you don’t like the way they describe the company because it’s not how you do it in your marketing collateral or you don’t like the fact your competitors are named, that is not a legitimate correction to request. In fact, you are likely to damage the relationship by asking.

For example, if you announce a combined Seed and Series A round, the reporter would be totally correct in just reporting the Series A in the headline since that is the news. They might opt to reference the undisclosed Seed amount and the total raised to date later in the article, but it is not an error to lead with the new round.

The thing that is hard — but so necessary — to keep in mind is that while your PR plan is part of your marketing program, reporters are not there for your marketing purposes. 

It’s also hard, but important, to keep perspective. Funding is a major milestone for you, but few will parse the article word by word the way a founder might. Remember, unless a story is egregiously negative, the very fact of its existence will be seen as a win by your customers, your backers — and your competition. 

Should you thank the reporter for writing a funding article about your startup?

It’s a fine line. It is entirely appropriate to thank the reporter on social media for their time and care when sharing your article. However, you should avoid language thanking the reporter for “writing a fantastic piece” or the like. The reporter is doing their job to cover their beat for readers, and many are sensitive to the implication that they were doing your startup a favor by covering it. Reporters feel differently about this sort of thing, but unless you know for sure where they fall on this issue, it’s safer not to cross the line into over-familiarity or give feedback about how they did their work. Chances are they will have moved on to the next story by the time this is published. If you want them to think well of you, promote the story and make sure it gets as many clicks as possible. Reporters do tend to notice that.

Final thoughts

Closing a round of funding, whether it is the first institutional check or a late-stage round, is a huge achievement for a startup. It is a chance to introduce the company to new audiences and showcase its growth trajectory. By following the steps above and avoiding the notable pitfalls, the announcement should be a high point in the PR program. It should help build relationships with new reporters, drive traffic to the site, provide media articles to share on the site, on social media and via email and boost internal morale. It’s a large statement of intent — and an announcement worth celebrating.

Handle it well — then move on towards greater heights. With these new funds come higher expectations, fresh resources and goals to hit. Good luck with your startup funding announcement. Now get out there and crush your marketing goals.