CyberSmart

The founder spent 15 years in technology and cybersecurity, building products, running tech teams, and helping companies with data protection, security, and governance. Watching customers struggle daily with cybersecurity challenges—particularly the lack of awareness around risks and how to approach them—became the clear pain point. The mission was simple: protect and empower SMEs through a unified cybersecurity platform. Unlike bootstrapped founders, the CyberSmart team believed the problem was urgent enough to pursue venture funding.

The first two years were about experimentation. The pandemic accelerated the shift to remote work, creating both massive opportunities and new risks for SMEs. The team initially pursued direct sales but discovered that their true strength lay in partnerships. Managed service providers (MSPs)—companies managing IT for multiple small businesses—became the ideal channel. It took significant work to figure out how to position, package, and enable partners effectively. But once they cracked it, the results were dramatic: customer acquisition cost to lifetime value ratio of 1:15, net revenue retention of 160% annually, and 99% monthly gross retention. They called this the "partner-led product growth model"—partners would land with one or two customers initially but expand to 20-30 over time.

Starting in January 2022, fundraising proved brutal. The founder pitched approximately 100 VCs over 15 months, attending 200-250+ meetings. Throughout this period, the company never had more than three months of runway. VCs rejected them for failing to grow 3-4x annually (despite 60-70% growth), claimed they "didn't see the business case," and imposed harsh terms. The founder described it as sitting shoulder-to-shoulder with his wife at a tiny desk in a one-bedroom flat, pitch-perfect from repetition, while rejection after rejection crushed morale. Yet he shared the struggle transparently with his 50-60 person team, emphasizing that hitting unit economics targets was critical. He iterated his pitch relentlessly, often jumping on calls with advisors to debrief and refine.

The turning point came when the team focused on finding the "perfect match" investor: a B2B SaaS-focused European fund that understood unit economics and their vision to scale in the UK without rushing into North America. They eventually landed four term sheets, with the final investor requiring persistence—they said no twice before committing. Crucially, the founder refused to settle for unfavorable terms, avoiding 2x liquidation preferences and maintaining board control. When Q3 2023 got tight, they also secured £1.5 million from Founder Path Finance (venture debt) at 6.5-8% interest, which they repaid without early repayment penalties. On the operational side, the founder shifted from aggressive hiring (planned 20-40 new people) to a "step and see" model, investing in leveling up existing talent instead. They also shifted from building everything themselves to a "borrow, buy, or build" strategy—exploring APIs, micro-acquisitions on acquire.com, and MVP-stage alpha products rather than full feature development.

CyberSmart closed their Series B with a European fund and secured venture debt, stabilizing runway significantly. The founder's parting lessons emphasized: build a sustainable business first (unit economics matter more than top-line growth), tilt odds in your favor through transparency and team alignment, and don't run out of cash—plan backward from profitability, aiming to retain roughly half your raised capital for the next milestone.