Series A Funding: 3 Years in the Making

The Genesis of Sounding Board: From Coaching Recipient to Provider

Christine Tao is the founder of Sounding Board, a company established in 2016. The firm specializes in providing executive coaching services to leaders within prominent organizations, such as Kraft and Heinz.

However, it wasn't always this way. Tao herself once benefited from the guidance of a coach.

A Transition to Leadership and the Value of Coaching

Previously, Tao accepted a challenging, high-level position at Tapjoy, a mobile advertising firm. While possessing substantial experience in sales, she was now responsible for leading the company’s complete sales team in an executive capacity.

This transition presented a steep learning curve. Fortunately, Tapjoy’s board of directors facilitated a partnership between Tao and executive coach Lori Mazan, a connection that proved instrumental to Tao’s success.

“The experience had a deeply significant effect, influencing not only my career progression but also my personal growth,” Tao explained.

Sounding Board: A New Approach to Executive Development

Subsequently, Tao and Mazan collaborated to create Sounding Board. This service utilizes a unique algorithm to connect individuals with suitable coaches.

The platform employs a capabilities-focused approach, and is even capable of quantifying the effectiveness of the coaching process.

Securing Funding and Early Growth

Initially, Tao operated with limited capital. She successfully secured $15 million in funding through a combination of pre-seed and Series A investment rounds.

A notable roster of investors participated, including Roy Bahat from Bloomberg Beta, Charles Hudson of Precursor Ventures, and Maha Ibrahim of Canaan.

Insights from "How I Raised It"

Tao shared her experiences on the “How I Raised It” podcast. She discussed strategies for rapid fundraising, refining one’s approach, and persevering through rejection.

Her advice centered on maintaining resilience and adapting to feedback during the funding process.

A Humble Beginning

From its inception, Tao envisioned a significant role for her company. Her goal was to democratize executive coaching, extending its benefits to a wider range of leaders.

This service wasn't intended solely for remediation of poor performance, a common application of coaching historically. Instead, Tao focused on fostering executive growth and development, empowering leaders to effectively guide their organizations.

A key component of her vision involved leveraging remote technologies to deliver coaching services.

However, initial constraints presented a considerable hurdle. Transforming these concepts into a viable business initially appeared as challenging as scaling a formidable peak.

Undeterred, Tao demonstrated resourcefulness and a willingness to work with limited means. She enlisted her sister, a skilled UX/UI designer, to create an initial application prototype.

Tao then proactively sought feedback on this prototype by sharing it within her professional network on LinkedIn. Simultaneously, she utilized her industry contacts to onboard the first cohort of Sounding Board coaches.

Regarding funding, Tao self-financed the company’s launch, operating entirely on bootstrapped capital before seeking external investment – all during her pregnancy.

The Importance of Demonstrated Progress in Fundraising

Initial fundraising efforts for Sounding Board didn't yield the immediate success Tao anticipated. Her first round of pitches to investors resulted in consistent rejections.

Tao openly shared a common, yet often unmentioned, experience: the majority of investors who eventually supported Sounding Board initially declined her proposals.

The primary reason for these early refusals was straightforward. While Tao had conducted preliminary testing, the underlying technology was still under development. Furthermore, she was actively seeking a technical co-founder.

Essentially, the concept existed, but lacked a concrete, demonstrable form.

However, Tao’s situation experienced a significant shift in a relatively short period.

Following an unsuccessful pitch to Karan Bahat at Bloomberg Beta in 2016, he ultimately led her pre-seed funding round just one year later.

Tao inquired about this change of heart, asking Bahat what prompted his eventual investment. His answer, as Tao recalls, was: “You delivered on everything you promised, and even exceeded expectations.”

Therefore, Tao emphasizes the critical need to demonstrate to investors a clear commitment to execution and follow-through. This, she asserts, is a decisive factor in securing funding.

Establishing a Dedicated Fundraising Hub

Tao successfully completed her Series A funding within six weeks, primarily due to a deliberately planned fundraising process.

Prior to initiating pitches, the team thoroughly examined their long-range vision, focusing on how their origin story could be presented as a captivating account. They also evaluated prevailing market conditions; while market forces are unpredictable, Tao emphasized the importance of articulating to investors how your offering aligns with the current market landscape.

The team, led by Tao, consistently refined their approach following each rejection and every instance of investor feedback.

“Following meetings, we operated much like a war room,” Tao explained. “We were focused on analyzing the feedback received and identifying areas where our responses needed strengthening.”

This involved developing presentations and visual aids to effectively convey their vision, allowing them to proactively address potential investor concerns in subsequent meetings. They aimed to anticipate questions and provide comprehensive answers.

As a direct result of this focused strategy, Tao’s team connected with Ibrahim from Canaan early in the Series A process. Ibrahim ultimately spearheaded the funding round, and Tao secured $13.1 million after approximately 10 to 15 investor interactions.

Key Elements of Tao’s Approach

• Strategic Narrative: Crafting a compelling founding story.
• Market Alignment: Demonstrating product-market fit.
• Iterative Refinement: Adapting based on feedback.
• Proactive Preparation: Anticipating investor questions.

This methodical approach to fundraising proved highly effective, enabling Tao to secure funding quickly and efficiently.

Guiding the Dialogue

A well-defined strategy empowers you to “execute your plan with assurance,” according to Tao.

Maintaining composure during investor pitches is crucial, and approaching investors as peers can be beneficial. Tao viewed each investor as possessing a wealth of valuable insights applicable to Sounding Board.

These diverse skill sets were also instrumental in Tao’s initial connections with investors during fundraising discussions.

“Investors bring expertise gained from their operational experience or previous investments. Identifying these areas allows for meaningful engagement on business-related topics,” she clarified.

Thorough research and preparation enable you to direct the meeting, preventing investors from dominating the discussion. This control, Tao emphasized, is paramount.

“Ensuring investors grasp your business model and steering the conversation accordingly is vital,” Tao stated. “My recommendation is to proactively guide those discussions.”