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Consiglio dei fondatori
Consiglio dei fondatori

How 3DLOOK Scored Their Series A Online During the Full Swing of the Pandemic

At the height of the 2020 pandemic, the 3DLOOK team road the ecommerce wave to bring on new customers and raise a Series A. Here's the detailed process they used to close $6.5M:
vadim rogovski 3dlook CEO founder

I started 3DLOOK in 2016, with a goal to create technology that accurately measures the human body using only a smartphone camera. It took my team and me almost a year of trial and error, but we finally came up with a digital tool that could do just that. It wasn’t long before our solution caught on in the apparel industry.

Since then, many progressive brands have chosen to work with 3DLOOK to create innovative shopping experiences for their customers. The results are promising to say the least, since we have helped these businesses reduce returns, increase sales and ensure customer loyalty.

However, no one could have predicted the pandemic last year and the resulting worldwide lockdown that accelerated the growth of e-commerce. It propelled more fashion brands to adopt our technology, and we immediately acted on this surge in demand. During COVID alone, we raised two rounds to fuel our growth with the latest Series A round of $6.5M (and $11.2M to date). The pandemic has unlocked a whole new experience of completely virtual fundraising, and here are some of the lessons it taught me along the way:

Use the full advantages of online communication to your benefit

The pandemic brought efficiency to the meeting schedule and enabled us to meet many more investors more quickly because no one was traveling and subsequently scheduled meetings with partners on a faster cadence. Normally we would have spent a lot of time planning and arranging meetings, flying back and forth to meet the investors in person, and so on. The pandemic shifted so much communication to virtual and saved a lot of time both for VCs and us. We pivoted our outreach strategy to target VCs anywhere in the world virtually. This helped us appeal to them without having to plan complex international travels. For example, I was able to join important negotiation meetings from a ski resort or during bank holidays, which normally would not have happened.

In the end, we were able to close the deal almost completely online and had only one meeting when the lead investor came to our main R&D office in Odessa to meet the technical leadership before sending us the terms sheet. We had a few lead options and were able to choose and sign a term sheet within three months. Interestingly, we signed the term sheet at night between the 30th and the 31st of December, which was only three months into the process. Overall, we were able to start and close our round within five months, which is pretty quick and efficient for a Series A, especially considering the pandemic.

Learn how Series A is different and prepare in advance

Series A is the first round of fundraising when full attention is paid to the company. Previously, on earlier stages, normally more attention was paid to the team itself, to the founders, whether they were able to execute their plan, and what was their prior experience, rather than to the company itself, but Series A is the first round when full attention is paid to the company. Ultimately, this means that you have to be prepared to answer any questions about the company’s traction, goals and forecasts, clients, hiring plans, and so on.

For instance, we emphasized the following points:

  • Our nearly six-fold growth over the last year
  • Two 5-year contracts with large enterprise clients
  • Long-time customers that were willing to  jump on calls and share positive feedback
  • A success story with our early e-commerce enterprise clients, enriched with stats and data

Before we started fundraising, we assembled a cross-functional team to work on the deck, including folks from finance, marketing, and product teams, and spent roughly one month working on it. During that month, we ran many iterations, brainstormed every week, and involved some of our advisors and early investors to review the pre-final version. Overall we reviewed and updated the deck around 40 times. Then on a weekly basis, we regrouped to analyze the feedback we got from the initial course with VCs to understand what could be improved to make it clearer. As a result, we emphasized traction, clients, cases, and future plans, as opposed to our previous decks, where the team was in the spotlight.

Make sure to prepare all of the materials beforehand

Make sure to collect all kinds of paperwork in advance. Those can be:

  • The deck, cap table, pro forma financial model – the main information that VCs are after;
  • Documents related to the team, such as CVs, employment agreements or consulting agreements, stock option grants;
  • Financial data;
  • Additional information, such as additional decks, clients’ contracts, or case studies.

Additionally, we realized that we needed a kit with a one-pager and a set of blurbs for different scenarios. Think of them as various templates that you can use in different situations and just easily copy and paste them without spending too much time.

We segmented the relevant VCs that we wanted to approach based on the level of our connection with them:

  • Category A had VCs we have already met and kept in touch with for years.
  • VCs in Category B had been on at least one call or in-person meeting with us.
  • Category C included VCs that we met or were referred to but haven’t been in touch with.

Each segment received a personalized blurb:

  • Segment A received a blurb rich with data, updates on our traction and achievements since our last call
  • Segment B received a short intro about the company, followed by traction data
  • Segment C – the ‘coldest’ one received the full info about the company from scratch, our benefits, and of course, the traction

All blurbs were sent by the company’s co-founders, which is extremely important to increase conversion

There are different approaches to VCs segmentation: some founders start from VCs who are less likely to invest and train on them. However, we started from the ones that we know very well. First of all, if one of them jumps in base faster, you’ll close the round faster, or if you have a better connection with them, they can quickly share the feedback that other ones won’t do because they don’t know you well yet. Their feedback helped us optimize both the pitch and the deck to answer investors’ frequent questions better.

We started from the closest ones, and then we went on to the groups that were a bit less relevant or the ones we didn’t know so well, but eventually, the lead investor came from the top priority group.

Additionally, we created a one-pager with the answers to the most popular questions. It helped increase the investors’ interest and allowed them to be able to skip to more specific questions, thereby fast-tracking what would have been a longer and more tedious process. It also made us look well versed and competent, which positioned us well within the investor community.

Analyze and be proactive

We decided to focus on VCs that we had some prior connections and relations with. This approach played well for us because we managed to run the outreach campaigns faster, and DocSend’s effective solutions came in handy. It was very convenient for us to email them instantly, thanks to DocSend’s secure email plugin.

Thanks to DocSend’s analytics, we also were able to track which VCs were looking at our spaces, what exactly they were looking at, where they spent most of their time. So, for example, we could follow up and ask if they had any questions on some of the materials because we saw them open the deck 20 times yesterday. DocSend helped us to be proactive and not reactive, because according to our experience, if you are proactive during fundraising, you spend much less time answering any questions in advance, compared to you having to react when someone is asking you questions. We led them to the strongest points of our deck, which made favorable impressions on most of our investors.

Because of the sheer amount of data that we had, we used the DocSend data rooms to store and organize all of the materials, which brought increased efficiency to the whole process. It not only helped us to keep all our documents within one space, but it also enabled smart permission management.

Using based practices of data room organization, we set up two data rooms:

  • The first one was for initial due diligence before the investors sent their term sheets. It contained basic info, such as clients’ contracts, patent, trademark, IP rights, cap table, financial model, org chart, sales deck, and pipeline
  • The other one was meant for the next stage of the deal after the term sheet was signed. We kept more information in this data room, including contracts with all employees, CVs, stock options, corporate documents, etc.

We also segmented our VCs lists and created multiple customized links leading to the same deck. Each group (we had three groups according to the level of our connection with them) received a different link, and we could track the activity of every group of VCs. When we went far enough with the lead investor, we could turn off the links for other groups without removing the deck from there. Additionally, our sensitive data, such as our financials, were protected from being stolen or copied, which was very helpful.

What’s next?

We started using DocSend during fundraising, and it helped us save a lot of time and resources when presenting our strongest points to our investors. Even after we sealed the deal, we kept it for our human relations team to manage all the related documents there. We are certainly going to keep using DocSend while updating and expanding all of the materials in our information space for our Series B fundraising.


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