How involved are investors in allocating marketing budgets?

We recently spoke with Seth Bindernagel, CMO at MOSS, formerly Twitter and Strava about how capital is deployed across marketing teams. Having sat inside of a fund as well as operating in businesses, Seth is uniquely positioned to discuss how involved investors are when influencing marketing budgets.

Transcript

I would say it depends on the type of investor who's involved in shaping marketing investment. If it's the earliest stages of a company and it's an early stage investor from a venture capital firm who's maybe led the Series A or even the Series B, I would say they have very little involvement in the deployment of capital to guide the marketing strategy. And the reason is that they're investing at the earliest stages of the company and their real relationship is with the founder and the idea and developing product market fit. 

As the stages of investment get later and later and the company grows more and more, more and more operational investors will come in. I call them operational but you you would say something like a private equity firm might come in or a later stage investor would come in who would really look at the expenditure across all disciplines. It's at that stage that I think later stage investors do actually have more involvement in how capital is deployed because they're investing in outcomes based on a company that already has product market fit. 

So the assumption is your growth, your marketing team needs to deploy capital wisely and we're giving you that money, so let us know how it's being spent. Early stage investors not so much. They just care that the startup founder is successful and goes and finds product market fit.

Find more on marketing investment

For more information on marketing investment, we recommend reading the key takeaways from our event discussing the relationship between the CFO and CMO.