Inovia Sessions Podcast: Mastering the Art of U.S. Expansion

The realm of tech entrepreneurship is vast, complex, and ever-evolving. Inovia Sessions offers a deep dive into this world, presenting insights, discussions, and firsthand experiences from those at the forefront of the industry. We’re excited to continue The Door to America mini-series, which provides a focused look at the strategies and intricacies of business expansion in the North American market.

In today’s episode, we’re diving into the pivotal aspects of raising capital from North American investors and establishing operations in the U.S. with Konstantina Psoma, Founder and CEO of Kaedim. With her roots in Athens and her eyes set on San Francisco’s tech landscape, she underscores the significance of building a strong network of founders and the complexities of fundraising whilst propelling a business forward.

With our host, Inovia Principal Mike McGraw steering the conversation, this episode offers a firsthand account of the challenges and triumphs of raising from top tier U.S. investors. This recap highlights some of the key takeaways shared during the podcast episode – dive in!

Crafting an Effective Fundraising Strategy for U.S. Expansion

When thinking about your fundraising strategy to expand in the U.S., leveraging existing connections and being active in key tech hubs like San Francisco can open doors to invaluable opportunities. Engage with the vibrant local communities, partake in industry events, and tap into the rich academic and professional networks available.

European founders seeking to adapt to the North American market can find resources like the Creative Destruction Lab (CDL) immensely helpful to acclimate to the ‘think big’ mentality prevalent in North America and hone their skills to effectively pitch their vision.

Success in fundraising hinges on three fundamental principles: a deep commitment to your business, a relentless focus on its growth, and continuous efforts in building and refining your product. This triad creates a solid foundation that attracts investors.

Additionally, fostering a sense of urgency and interest among potential investors is key. Consider sending regular updates on your business’ progress to potential investors to keep them abreast of your progress and show that you’re delivering on your promises. This strategy can boost engagement and momentum, leading to new introductions, opportunities, and investment avenues.

Actionable Tip: Approach fundraising like a go-to-market strategy. Define your ICP clearly, engage investors through warm introductions, and foster interest with regular email updates and solid execution. Utilize these updates to strategically make some requests and identify the most supportive firms

Different Investor Approaches: EU vs U.S.

Understanding the different mindsets of venture capitalists in the EU and U.S. is key for European founders seeking North American funding. Statistically, European VCs’ background more often lies in banking rather than operations; they may not have firsthand experience as founders, leading to a different evaluation of risks and opportunities. In contrast, American VCs prioritize the vision and potential of an idea, placing significant emphasis on the founder’s capabilities. These investors are more interested in leadership qualities and the founder’s depth of understanding of their domain, shaping the conversation differently.

Actionable Tip: Know your audience. Founders must tailor their approaches to align with the firms’ investment philosophies to maximize their chances of success. In the U.S., this means emphasizing vision, innovation, and leadership.

Valuing Industry Expertise

Balancing your cap table by leveraging the European angel investor ecosystem and U.S. investors not only diversifies your funding but also enriches your business with invaluable insights, mentorship, and networking opportunities. This approach to round composition demonstrates a strategic use of funding rounds not just for capital but also for building a network of knowledgeable and influential industry figures. 

Europe has seen an explosion in the number of scaled technology businesses and exited operators turned angel investors. Make sure you tap into that richness in your early days.

Actionable Tip: When planning your fundraising rounds, look beyond geographic and financial contributions and focus on bringing in industry experts, particularly those with relevant experience and connections in your sector.

Balancing Time Between the EU and the U.S.

Despite the focus on the US, frequent visits back and forth between locations are critical for business and inspiration. Building a self-sufficient team in the EU that can manage operations autonomously and focus on the tech side, allows you to pursue growth opportunities in the U.S. with the confidence that the business is progressing steadily. Give freedom to your talented people resources and they will deliver better performance and great ideas.

Actionable Tip: Maintain a strong presence in both the EU and the U.S. Strategically split time between key locations. Maintain a self-sufficient team back home through regular, well-timed meetings to ensure alignment and foster team autonomy and innovation.

For deeper insights and to grasp the strategies discussed by Konstantina Psoma, tune in to the full episode. Stay with us on this journey; our next episode promises a deep dive into Operating from Canada. Subscribe to ensure you don’t miss out!