In iContact's seed round in 2006, we talked to 12 firms and received 2 term sheets. It was a difficult process that took 8 months from start-to-finish that involved a lot of rejection, skepticism, entrepreneur unfriendly terms, and pulling teeth to get meetings.

This time around for our Series A, iContact was three times the size, had a stronger team, and was out to raise more money. Firms were coming to us with an existing understanding of who we were, where we fit in the market, and what we were trying to accomplish.

We talked to 34 venture firms and 3 private equity firms about investing in iContact between January and May for this round and presented at three venture conferences, TechJournal South's SEVC in Raleigh, The AeA Venture Forum in Atlanta, and CED Venture 2007 in Durham.

We received 4 term sheets and on June 1, we chose to sign the Updata Partners term sheet. We chose Updata because of:

1. Their experience with Software-as-a-Service companies
2. Many of their partners' operational experience as software entrepreneurs
3. Their ability to quickly understand what we are trying to accomplish
4. Their willingness to come visit us first
5. The fact that they were out in the market and attended the AeA Venture Conference
6. Their approaching right away after hearing my pitch at the AeA Venture Conference on March 20.
7. Their willingness to follow-up with a busy CEO (after two weeks of silence from me due to being overwhelmed with the number of firms we were in talks with they reached out again in mid-April)
8. Their clarity with the process and timeline
9. The fact that Updata also had a M&A advisory service that could be helpful to us down the road.
10. Their willingness to connect me with their portfolio CEOs prior to term sheet selection
11. The fact that they truly listened to what we were seeking
12. The fact that they were first to get us an 'in-the-ballpark' term sheet.

On the day we had previously set as a drop-dead date for selecting which firm we would go with (Friday June 1) we had three in-the-ballpark term sheets from three amazing firms, anyone of which I would have been honored to work with. It was a very difficult decision that came down to gut feelings of myself, our Chairman Aaron, and our CFO Tim.

So the chemistry was good and the fact that their principal joining our board, Carter Griffin, was a UNC alum did not hurt.

Here's to a great partnership with Carter and Conor, and a hopeful big win for both iContact and Updata.

Our lawyers Merrill Mason and Miranda Miller at Smith Anderson did a great job for us and it was a pleasure to work with Joey Silver and Doug Spear at DLA Piper representing Updata.

The firms we talked to during the process were:

IDEA Fund Partners, Southern Capitol Ventures, Wakefield Group, Frontier Capital, River Cities Capital, Bessemer Venture Partners, Pequot Capital, Scale Venture Partners, Noro-Moseley, HIG Partners, Core Capital, Valhalla, JMI Equity, Novak Biddle, New World Ventures, Capital Resource Partners, Battery Ventures, Growth Capital Group, OCA Ventures, Symphony Technology Group, Edison Venture Fund, Summit Partners, Tudor Ventures, Open View Partners, True Venture Partners, Harbert Venture Partners, Ticonderoga Partners, Highland Capital Partners, Ballast Point Ventures, WWC Capital, Antares, General Catalyst Partners, MK Capital, Vantage Point, and the private equity groups Kayne Anderson, Alta Communications, and Housatonic Partners.

It sure is nice to be part of a venture portfolio...

And thank you to the entrepreneurial Gods for not having to talk about our go-to-market strategy, secret sauce, or competitive differentiation or for at least another year.

I will be posting more about what I learned during this process later this week.

Cheers,
Ryan