- Edrizio De La Cruz, CEO of the buzzy fintech startup Arcus, said what’s helped him more than anything while raising nearly $13 million in funding has been his ability to tell a good story about his business.
- “I think a lot of times entrepreneurs are so busy in the weeds of operating their business that they forget that storytelling is part of the process,” he said.
- The Dominican Republic-born entrepreneur credits the prestigious startup incubator, Y Combinator (YC), for instilling such emphasis on storytelling as a part of the fundraising process.
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Some startup founders may say the key to fundraising is knowing the right investors and landing the right meetings. Some may say it’s all about “hockey-stick” growth metrics (think, up and to the right).
But according to Edrizio De La Cruz, CEO of the buzzy fintech startup Arcus, who spoke to Business Insider in a recent interview, what’s helped him more than anything while raising nearly $13 million in funding from Silicon Valley’s top VCs has been his ability to tell a good story about his business.
“People undermine how important storytelling is — being able to very specifically describe what you’re building, who you’re building it for, and why it’s valuable,” De La Cruz said. “I think a lot of times entrepreneurs are so busy in the weeds of operating their business that they forget that storytelling is part of the process.”
De La Cruz says he believes some founders go out to fundraise and don’t get the results they desire because they’re not able to break out of their “operating mindset.”
“It’s a completely different skill set,” De La Cruz said. “Operating is a more analytical, pragmatic, practical, and day-to-day aspect. Fundraising is much more artistic.”
Having spent time as an investment banker, the fintech founder tells us the idea of fundraising being less analytical was initially counterintuitive to him. The numbers still play a role in the fundraising process, he says, but De La Cruz likens having buttoned up metrics for an investor meeting to having a shiny resume for a job interview.
“The resume will get you the interview, but your interview skills will get you the job,” De La Cruz said. “A lot of people spend 80% of their time on their resume and 20% on their interview skills when it should be the inverse.”
The same is true for fundraising, according to De La Cruz. Ahead of meetings with VCs, founders should spend most of their time on their pitch — being able to tell a compelling story about their business that can “influence or ‘seduce’ an investor,” he said.
Read more: The buzzy fintech startup Arcus has raised nearly $13 million. Here’s the pitch deck that’s helping it woo top VCs like Andreessen Horowitz.
The Dominican Republic-born entrepreneur credits the prestigious startup incubator, Y Combinator (YC), for instilling such an emphasis on storytelling as a part of the fundraising process. Having gone through YC in the spring of 2013 with his original company, Regalii — which provided easy and secure ways to pay bills across borders — De La Cruz said he also learned the importance of knowing when and when not to be in “fundraising-mode.”
“They would tell us, don’t even spend time on pitching until two weeks before demo day because it’s a different skill set. It’s a different part of the brain you have to access to develop that skill,” he said.
In 2016, De La Cruz pivoted his business to become what Arcus is today — the digital payments infrastructure behind some of the most popular banking, fintech, and retail applications across the US and Latin America. Specifically, Arcus makes reoccurring payments easier.
“We see recurring payments as the wedge into financial health for the average American and Latin American consumers,” said De La Cruz, whose fintech startup of just over 60 employees has duel headquarters in New York City and Mexico City.
To date, Arcus says it has raised nearly $13 million from investors like Day One Ventures, Winklevoss Capital, and Andreessen Horowitz. Pitchbook, a database that tracks venture capital funding, pegs the company’s total funding at $19 million. Arcus says this is a mistake, and that including convertible notes and traditional equity funding, the total amount it has raised is roughly $13 million.
Moving forward, De La Cruz said that Arcus has signed some of the biggest banks in the US and Mexico, and so the company, in the near term, will be focused on successful launches with those partners. The chief exec also said Arcus plans to raise “a big round” of capital to “more aggressively” help support those larger partners.
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