Startup founders waste $10,000 – $30,000 a month on worthless publicity efforts when there's a better way, says former PR strategist-turned-VC Masha Drokova, who just raised a $52.5 million fund

  • VC Masha Drokova previously spent seven years working in PR, advising companies like Houzz and HotelTonight.
  • She says startups often waste tens of thousands of dollars hiring PR firms that don't contribute to a company's growth.
  • Drokova explained how her VC firm, Day One Ventures, develops in-house media strategies for its companies that help them raise millions.
  • The firm just announced a $52.5 million second fund.  
  • Visit Business Insider's homepage for more stories.

Masha Drokova isn't your typical Silicon Valley investor.

She spent her late teenage years in Moscow, where she devoted her life to organizing and demonstrating for Nashi, a Putin-backed political movement established in Russia in 2005. 

After leaving Nash in September, 2010, Drokova spent seven years working as a public relations strategist. She started as the PR director of the venture firm Runa Capital before becoming a communications director for the global Swiss tech consultant company Acronis. In 2014, she moved to the United States, where she started her own PR studio advising companies like Houzz, HotelTonight, and Gett.

Now Drokova is an investor running her own VC firm, Day One Ventures, which she founded in 2017. 

The 31-year-old Russian immigrant just raked in a $52.5 million fundraising haul for her second fund for the firm, exceeding her initial target of $40 million. Over 70% of her portfolio companies, she says, have received follow-on funding, oftentimes from prestigious firms like Andreessen Horowitz and Index Ventures.

Drokova admits that traces of her past political life still influence her investing style. 

"I love companies that look like a movement," she told Business Insider, citing companies like DuckDuckGo and Privacy.com, both of which she backed in her first fund, partly out of her belief that privacy is a "basic human value" and a necessary bulwark against intrusive government surveillance. 

But the true secret of Drokova's success, she says, comes from her unique ability to help her portfolio companies craft killer media publicity campaigns, a crucial factor for determining a startup's survival that she believes founders overlook all too often.

The biggest PR mistake startup founders make

Before investing in a company, Drokova makes sure that its product or founder has a compelling story to tell. That's why her firm often passes on enterprise and business-to-business startups operating in more technical markets. 

"When we make investments, we try to understand: 'would we be helpful with PR?' If the company is really good, but there is no story, or it's really hard to see the story, then it's unlikely we'd want to invest," she said. 

The biggest mistake early-stage founders make, Drokova says, is to spend on pricey PR agencies rather than on developing an intentional, in-house strategy for media campaigns tied to achieving specific business goals. 

"Founders pay PR firms for 3-6 months, something between $10,000 to $30,000 dollars per month, and at the end of that period, have one or two articles in media sites they've never heard about," she said. "I don't think it's a very good solution for an early-stage company."

Day One Ventures ensures this never happens because the firm actively develops a media strategy for all the early-stage companies it invests in. And her portfolio includes some very buzzy companies like email app Superhuman, the creative art studio MSCHF, and personal finance app Truebill. 

That starts with crafting a coherent founding story and mission for the company, and extends to executing targeted PR campaigns that help companies achieve specific business goals, like hiring more employees or expanding a particular product's consumer base.

For example, the venture firm helped DoNotPay get coverage on the Today Show in January, which spiked the company's revenue growth by 70% in just two days, according to Drokova. The company, which calls itself the "Robinhood of the Internet," helps Americans resolve cumbersome tasks like dispute parking tickets and cancel gym memberships. 

The publicity and subsequent growth helped the startup with its subsequent series A fundraising, a $12 million round announced in June that received backing from investors like Andreessen Horowitz and Founders Fund. 

"They built a product and did good press, and it kickstarted the Series A," Drokova said. 

"We're looking for something like that, for the right places and the right time and the right media moment that are not just good to have, but have a crucial effect on a company's life," she added. 

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