Method Communications 23 Jul 2019 // 2:38PM GMT
By Beth Haiken, EVP, Method Communications
Does it seem like it’s more difficult than ever to interest journalists in your company’s newest funding round? You’re not imagining things. It is, in fact, a whole new world out there. Understanding what you’re up against is the first step. Knowing what you can do about it is the second.
When venture capitalist Aileen Lee coined the term unicorn 6 long years ago to describe companies that had achieved a valuation of $1 billion or more while still private, such companies were rare: there were just 39 of them, according to her calculations. Unicorns aren’t as special as they once were - today there are more than 300.
Unicorns aren’t the only mythical beast roaming the enchanted forest. They now keep company with decacorns ($10bn valuation), centacorns ($100bn valuation), and minotaurs - companies that have raised more than $1 billion in venture capital funding, typically in an effort to “blitzscale,” or grow so quickly no one else can catch up. This may be, as The Hustle so evocatively described it, like “playing monopoly on crack,” but it’s happening: in February 2019, there were 56 minotaurs - up from just 9 in 2016.
There aren’t just more highly valued startups (and more startups that are valued highly) - they’re getting to high valuation faster. In 2013, Lee included companies that had been founded in 2003 or later, generously giving the members of the first unicorn club 10 years to reach that milestone. In mid-2018, Quartz hailed Bird as the speediest unicorn to date, having hit the $1 billion mark in under a year since founding.
The higher bar for funding round coverage (“We don’t cover anything below $100 million,” a journalist told me earlier this year) is of course partly because massive funding rounds have become common. But it’s not just the late stage rounds that have grown - Series A and seed rounds have also increased, so the bar is higher at all levels.
If you can show your executive team, “Here are the three biggest funding stories of the month and they all have a celebrity investor and are over $200 million,” you’re providing valuable context.
As if hundreds of mythical beasts stampeding weren’t exhausting enough, some unicorns turned out to have feet (or horns) of clay. Whether you call them undercorns, unicorpses, or (my favorite, with a hat tip to Techcrunch’s Alex Wilhelm) horses, they’ve left a bitter taste in the mouths of journalists who once sang their praises, as well as investors, resulting in a heightened focus on whether your startup has a path to profitability.
And then, Theranos. When is a unicorn not a horse? When it’s a fraud. Making it harder for PR people to interest journalists in startups isn’t the worst thing Elizabeth Holmes did - but still. ‘Nuf said.
There are more people working in public relations than ever before, and fewer journalists - a mind-boggling six to one ratio, up from fewer than two to one 20 years ago, according to Bloomberg. That means not only are there fewer people to pitch - there are more people pitching them, so the effect is amplified.
So where does all this leave PR practitioners working for or at startups whose CEOs expect every funding round to generate a flurry of positive press? In a tough spot, for sure. But there are things you can do to up your chances of breaking through.
1. Do your research. Whether in-house or agency, it’s easy to get “tunnel vision.” Take a look at other funding stories that have published recently by authors and in outlets you care about. What do you like about them? What elements did they have that made them interesting? Not only will this give you ideas for your own story, it will help you set expectations around what’s possible/likely. If you can show your executive team, “Here are the three biggest funding stories of the month and they all have a celebrity investor and are over $200 million,” you’re providing valuable context.
2. Don’t just tell the story - shape the story. Yes, it’s competitive out there, and yes, it’s hard to stand out, so take an active role in developing the narrative. Ask your CEO, “Is there a celebrity investor? If not, is it possible to bring one in? Does one of the VCs have a unique or contrarian point of view on the space or industry? Are we willing to put a stake in the ground as to when we’ll be profitable?” Help your team understand the need for differentiation - and how to achieve it.
3. Write THE BEST press release. And by best, I mean one that answers not just the five Ws (who, what, when, where, why) but the more critical “So what?” (Or, more politely, “Why should we care?”) And be vigilant. As the release goes through round after round of reviews, it will inevitably get filled with jargon, cliches, and buzzwords. You will be exhausted and discouraged but you MUST FIGHT ON. Write a really, really good pitch too, in plain English.
4. Consider an exclusive. One substantive piece that tells the story of the company - not just the funding round - is worth a bunch of short mentions, and you're likely to see some mentions as pickup to a strong exclusive piece.
5. Scope the timing. Some things are out of your control. I should know - we had a client media dinner scheduled the day Travis Kalanik was forced to resign from Uber. (Were we screwed? Almost, but not quite, because my team was awesome and we pulled it off - but that’s another story). But to the extent you can look ahead and avoid big scheduled events like CES or Dreamforce, you’ll reduce the risk of getting skunked.
6. Ask for help. PR people are competitive, but they’re also empathetic and helpful. If your well’s running dry, ask friends and acquaintances for recommendations for journalists to try. A hive mind is better than one mind.
7. Remember, earned media isn’t the only channel available to us today, so plan to use them all. Draft a thank you to your loyal customers to post on your company blog, a milestone manifesto and thank you to your team for your CEO’s LinkedIn and Medium, and social posts for your company and any execs who are active, and put some dollars behind amplifying those and any earned pieces you get.
Don’t put your head in the sand - the culture has changed and the conversation around VC funding and startups is very different, and more skeptical, than it was a few years ago. But don’t give up either. It’s still possible to land a strong story around funding if you approach it strategically and take an active role in shaping the narrative.