The CEO of cannabis data startup Headset took half a year to meet with dozens of investors before raising a $12 million round. Here's why he says it's so important to find the perfect backers.
- Cy Scott, the CEO of cannabis analytics startup Headset, said that he spoke with around 20 to 30 investors over a six month period to close a $12 million Series A funding round.
- Scott walked through his pitching process and shared his best tips in a webinar hosted by Business Insider.
- Sign up for Cultivated, our new weekly cannabis newsletter.
Raising money for a startup in a competitive industry like cannabis-tech is no easy feat.
Headset, an analytics startup for the nascent marijuana industry, raised a $12 million Series A round backed by prominent investors earlier this year and has inked deals with market research firm Nielsen and accounting firm Deloitte.
Cy Scott, Headset's CEO, walked through what made his pitch successful in a webinar moderated by Business Insider. He was joined by brother-and-sister duo Morgan and Emily Paxhia, the managing partners of the cannabis-focused investment fund Poseidon Asset Management, who led the funding round.
In order to close the round, Scott said he had to put in the work and take a lot of meetings.
In the webinar, Scott said he met with 20 to 30 groups of investors over half a year while he was trying to raise his Series A funding round, "which is basically as many as possible."
Read more: Top investors from a cannabis-focused fund and early Juul investor share their 3 best tips for making a successful pitch
"This was right out of the gate," Scott said. "Let's do the pitch and see if we're a good fit because it goes both ways."
Thanks in part to all those meetings, Scott ended up raising approximately $6 million more than planned from three venture firms. All in all, Scott estimates it took about six months to close the Series A.
While founders are often hungry for funds, Scott said that the right investor-founder relationship can make or break a startup. You want an investor who's aligned with your vision for the company.
"Obviously you want to get an investor to provide capital, but you want to make sure that they're the right investor," Scott said.
While Scott says he could probably raise funds more quickly the next time around, a side effect from taking all those meetings was building relationships with potential future investors - even if they passed on the deal the first time.
"It helps to have that rapport," said Scott.
- Read more:
- We got an exclusive look at the pitch deck that cannabis education platform Green Flower Media used to raise $20 million from top investors
- Here's the pitch deck that cannabis-beverage startup K-Zen used to raise $5 million from seasoned Silicon Valley VC firm DCM Ventures
- We got an exclusive look at the pitch deck two Ivy League MBAs used to raise a $1.5 million seed round for a cannabis-infused beverage startup
- We spoke with the top recruiters in the booming cannabis business. Here are their 3 best tips for landing your dream job in the industry.
- We asked ChatGPT who the greatest athlete of all time is and it did not go well for LeBron James
- A man kept the same pair of contact lenses in for 3 years, causing permanent astigmatism and buildup behind his eyelids. His doctor said he's not responsible enough to wear contacts.
- Clarence Thomas wrote a scathing, nearly 50-page dissent about why the Supreme Court should have gutted voting rights
- JioTag — A pocket-friendly alternative to Apple AirTag for finding your lost belongings
- Realme 11 Pro Plus vs Redmi Note 12 Pro Plus – the under ₹30,000 phone to buy
- How Tata Communications plans to chart its financial turnaround
- Railway jobs: 12,000 recruited under 'Rozgar Mela' initiative
- List of famous things to buy in Goa