Podcast
Questions and Answers
Which type of investor is known for quicker deployment of funds?
Which type of investor is known for quicker deployment of funds?
- Venture Capital
- Partner Fund / Family Offices (correct)
- Incubator and Accelerator Firms
- Angel Investors
What is considered the most crucial factor that impacts a project's success in raising funds?
What is considered the most crucial factor that impacts a project's success in raising funds?
- The location of the project team
- The technology behind the project
- The marketing strategy employed
- Attracting a lead investor (correct)
Projects that focus on actual products instead of underlying technology are typically referred to as being:
Projects that focus on actual products instead of underlying technology are typically referred to as being:
- Product-focused (correct)
- Service-oriented
- Technology-centric
- Feature-driven
Which type of fund is typically associated with longer due diligence times?
Which type of fund is typically associated with longer due diligence times?
Which of the following is suggested to be avoided unless it provides strategic value?
Which of the following is suggested to be avoided unless it provides strategic value?
In a go-to-market strategy, what should be prioritized over marketing focus?
In a go-to-market strategy, what should be prioritized over marketing focus?
Which group of projects is likely to focus heavily on technology in their funding efforts?
Which group of projects is likely to focus heavily on technology in their funding efforts?
What type of investors is likely to come with preferential service terms?
What type of investors is likely to come with preferential service terms?
What is the primary benefit of securing a good lead investor?
What is the primary benefit of securing a good lead investor?
Which of the following is NOT typically included in the main deck for pitching?
Which of the following is NOT typically included in the main deck for pitching?
Why is the GTM (Go-To-Market) Strategy critical in a pitch deck?
Why is the GTM (Go-To-Market) Strategy critical in a pitch deck?
What aspect of the token utility should be well thought out and ideally involve a tokenomics advisor?
What aspect of the token utility should be well thought out and ideally involve a tokenomics advisor?
What should be included in the competitor analysis section of the pitch deck?
What should be included in the competitor analysis section of the pitch deck?
In the Anatomy of a Deck, what serves to validate the project and facilitate further fund raising?
In the Anatomy of a Deck, what serves to validate the project and facilitate further fund raising?
What is the purpose of the data room in a fundraising pitch?
What is the purpose of the data room in a fundraising pitch?
Which of the following sections outlines the vision and mission of the project?
Which of the following sections outlines the vision and mission of the project?
What is the chance of success for Tier 2 projects?
What is the chance of success for Tier 2 projects?
What should a project owner focus on when approaching investors?
What should a project owner focus on when approaching investors?
What is the maximum amount a Tier 4 project can raise?
What is the maximum amount a Tier 4 project can raise?
How long can the due diligence process take?
How long can the due diligence process take?
What is a common commission range for referral agreements in fundraising?
What is a common commission range for referral agreements in fundraising?
What is crucial to understand after pitching to an investor?
What is crucial to understand after pitching to an investor?
What does it mean to pivot the concept or pitch?
What does it mean to pivot the concept or pitch?
Which tier requires at least 2 Tier 1 investors for a high chance of success?
Which tier requires at least 2 Tier 1 investors for a high chance of success?
What is the primary role of domain experts in an advisory capacity?
What is the primary role of domain experts in an advisory capacity?
Which type of advisor is primarily known for their ability to connect you with influential individuals?
Which type of advisor is primarily known for their ability to connect you with influential individuals?
What distinguishes golden tippers from other types of advisors?
What distinguishes golden tippers from other types of advisors?
What is the typical range of advisor allocation in a funding structure?
What is the typical range of advisor allocation in a funding structure?
What does 'FDV' stand for in the context of a token raise?
What does 'FDV' stand for in the context of a token raise?
In equity raises, what instrument is typically issued?
In equity raises, what instrument is typically issued?
What is a key characteristic of mentors in an advisory relationship?
What is a key characteristic of mentors in an advisory relationship?
What does issuing a SAFT in token raises imply?
What does issuing a SAFT in token raises imply?
Study Notes
Overview of CRT Labs
- CRT Labs has invested in over 150 projects
- CRT Labs is the lead investor in the Partisia Blockchain
- They are responsible for raising over $40 million for Partisia
- They have reviewed over 1,000 decks since 2021
- They conduct monthly deal flow calls with Tier 1 and Tier 2 funds
Investor Types & Tiers
- Web3 Funds: Partner Funds/Family Offices, Venture Capital, Ecosystem Funds, Incubators, Accelerators and Advisory Firms, Service Provider Funds, Launch Pads, Syndicates and Pools
- Traditional Funds: Invest in traditional assets
- **Hybrid Funds: ** A combination of Web3 and Traditional investments
- Angel Investors: Individual investors providing capital for early-stage ventures
Why Projects Fail to Raise
- Technology Focus: Common in projects from China, India, Russia, and Eastern Europe
- Marketing Focus: Common in Western projects, particularly in the USA
- Product vs. Technology Focus: Emphasize the actual products and features your technology enables, focusing on the end-user experience.
- Go-to-Market (GTM) vs. Marketing Focus: Demonstrate a clear GTM strategy, understanding your ideal buyer segments globally, competitor analysis, acquisition costs, and efficient targeting.
- Lead Investor Importance: Having a strong lead investor is crucial, as they validate your project and can significantly impact the success of your raise.
What's Needed to Pitch
- Main Deck: 1-page, 4-page, or litepaper
- Whitepaper: Detailed technical document
- Data Room: Financial forecasts, GTM strategy, acquisition costs, conversion rates, attrition rates, etc.
- Social Media: Twitter, Telegram, Discord
Anatomy of a Deck
- Overview: Project overview, vision, mission, industry overview
- The Problem: Address existing issues or challenges in the market, include specific statistics and reference sources
- The Solution: Explain your product and core features, provide a concise overview
- Products and Features: Detailed description of your offerings, visually presented with images
- Opportunity/Market Sector Overview: Define the market size and how you can capture a specific market share
- Competitor Analysis: Include a competitor comparison table, XY axis comparison, and Venn Diagram
- GTM Strategy: Define B2B and B2C customer segments, engagement and monetization strategies
- Token Utility: Clearly outline the purpose of your token, including any burn or buyback mechanisms
- Technology Stack Breakdown of technical flow, DApps integration, and how it fits into the Web3 ecosystem
- Team: Focus on leadership team with credentials.
- Advisors: Highlight individuals who can fill gaps in your team's experience, particularly in GTM strategy
- Tokenomics: Breakdown of token allocation for raises, team, advisors, ecosystem, marketing, and reserve
- Raise Details: Specify raise target (FDV), types of raises (SAFT, SAFE, SAFE + Token Warrant)
Project Tiers
- Tier 1: $5M+ raise, at least 2 T1 investors, high chance of success
- Tier 2: 3M−3M - 3M−10M raise, at least 3 T2 investors or 1 T1 investor, medium chance of success
- Tier 3: 1M−1M - 1M−3M raise, no T1 investors, at least 1 T2 investor, low chance of success
- Tier 4: Up to $1.5M raise, T3 investors, negligible chance of success
Things to Consider Before Approaching Investors
- Investor type and tier
- Due diligence time: 1-90 days
- Market macro conditions
- Average investment ticket size
- Impact of investor on your project's success
- Value you can bring to the portfolio
- Focus on higher tier investors first
- Good investors will only set up a group chat/call if they like your project.
Questions to ask after the Pitch
- Feedback on your project
- Timeline for decision-making
- VC's deal flow sharing process
- Ensure your deck can sell itself
- Have a clear and concise elevator pitch
Closing Notes
- Focus on securing a strong lead investor or a group of lead investors
- Identify your project tier and target relevant investors
- Don't be afraid to adjust your pitch based on investor feedback
- Consider referral agreements (5% commission) to incentivize fundraising
- Launching your product without a token is preferable to investors during bear markets
Deck Links
- BitsCrunch
- Endaoment
- Magic Square
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Description
This quiz provides a comprehensive overview of CRT Labs' investment strategies, highlighting their involvement in various blockchain projects and investor types. Participants will explore the common reasons projects fail to raise capital and the different tiers of investors in the Web3 landscape.
