Coronavirus Diaries From the C-Suite
I Turned Down a $4 Million Term Sheet. Then the Coronavirus Hit.
A health care startup is now scrambling for funding after turning down a VC investment in February
Coronavirus Diaries From the C-Suite is a new Marker series where leaders share how the pandemic is affecting their businesses.
In early February, Jo Schneier received a term sheet for $4 million in Series A funding for his New York City–based health startup, Trusty, which develops Medicare tools for health insurance brokers. Schneier, the company’s co-founder and CEO, turned it down. Funding deals have since dried up, and Schneier is desperately trying to cut costs so that Trusty — which had raised $3 million to date and has 14 full-time employees — can stay in business. Now working out of his Queens bedroom on a desk he borrowed from his 10-year-old son, Schneier spoke with Marker about the company’s mad scramble for cash.
The $4 million term sheet would have been really bad for our early investors — the valuation would have crushed them. So we decided to do a seed extension for $750,000, focus on growing revenue for the next couple months, and then do the Series A. We had all these investors lined up, like ducks in a row, waiting for…
