How To Raise First Dollars When Investors Are More Cautious, The Founder Perspective

While it’s always good to hear from venture capitalists when it comes to dollars and cents, how founders are navigating the capital market is just as important. So we’re gathering Amanda DoAmaral of Fiveable, Sara Du of Alloy Automation and Arman Hezarkhani of Parthean to talk us through what worked for them and how their perspective has been updated in light of the changing economy.

Well welcome everyone I gotta admit this Is a panel I've been looking forward to And I'm not just saying that because I Am moderating it but love to be able to Dive in here with these three Entrepreneurs about something that is Top of Mind really in any Market Fundraising but especially in a market Like today's things are a little more Cautious investors are being a bit more Choosy it definitely doesn't feel like 2021 did and of course where do you go To get advice for fundraising A lot of people love to give advice you Can find it on Twitter you can find tons Of thought leadership on it but I think Most of us in this community know it's Sometimes hard to sort of cut through The noise and find out what people are Saying versus what people are actually Doing especially when it comes to Investors So hoping to dive into that a little bit Today kind of looking at how these three Founders navigated their fundraising Process and sort of what they've taken Away from it that could help Founders Looking to fundraise either for the First time or sort of coming into this More challenging market and hopefully we Can walk away with some fun advice today But I think what might make the most Sense to get started is to sort of set The stage if we're talking about

Fundraising maybe it'd be a good idea to Start if you guys want to each describe What your fundraising Journey has been Like what rounds you've raised sort of What the market was like when you did Raise them maybe Amanda you want to get Started yeah for sure my name is Amanda Demerol the CEO co-founder of fiveable Or edtech company do content study Spaces for high school and college Students we did our precede round Pre-covered right before right in the Like kind of end of 2019 the winter we Did a seed round then in the next summer And then our series a was about a year Ago What about you Sarah hey everyone I'm Sarah I'm the CEO and co-founder of Alloy automation we are a connectivity Layer for e-commerce and we essentially Allow Brands to automate away tedious Work and so we've raised three rounds of Funding in total and 27 million did our First round in March of 2020 right when The pandemic hit and I was actually Freshly dropped out of Harvard so 18 Didn't really know how to do fundraising And then we did a four mil round later That year when things were good and then We did our a with Andreessen earlier This year which obviously this year was A roller coaster Awesome my name is Armand I'm the CEO And founder of a company called parthian

We're a financial education company and We pair you up with a financial coach Who creates a custom learning path for You based on your interests your goals And your needs we raised a Little angel round right before last Summer and then we went through pair VCS Phenomenal accelerator and that helped Us raise a uh whether you call it a Pre-seed or a seed really depends on the Day but we raised some money last December and then when the market turned We invited some more investors through An extension just a few months ago Mm-hmm and thinking about sort of Raising those first Venture dollars when You guys were first looking to sort of Bring Capital into the startup was it Harder than you expected I didn't know what to expect I used to Teach in Oakland I it was it was a whole New world for me um but it was really Hard because I also was just someone who Was completely underestimated in every Aspect and those early rounds were Were really tough I had to do a whole Lot of pitching like hundreds of Different pitches in the beginning to Just prove to people that I was worthy Of those dollars to put them towards Supporting students and building a huge Business out of that Yeah honestly like for me I didn't Really have a sense of you know what

Money looked like and even now it's like You look at the bank account there's Like millions of dollars in there it's Just zeros at the end of the day Um but prior to fundraising I'd never Really even had like a full paycheck so Um yeah I thought of fundraising um and Raising money as just a super abstract Concept like you start a project and Then you basically go out and beg for Money and somehow the money appears and You keep building through that so it's Always been like a medium for achieving Whatever you set out to build initially Yeah Um I mean I think it's even more so than it Being difficult it's just so much Different than what you expect because You always hear about the announcements Of people who were successfully who just Successfully fundraised you rarely hear Someone going out to TechCrunch and Saying hey I just failed raising a bunch Of money right Um that mixed with the fact that Founders are rarely coming to it as Professional fundraisers we're usually Really good at something else and so We're coming in working with Professionals who Um they know how to play the game they Built the game and we're kind of coming Into that like kind of like you

Mentioned um and yeah so definitely So it's interesting that you just Mentioned that regardless of whether it Was difficult it was different than you Were expecting so maybe that would be Good to sort of double click on what was Different about the actual process and What you're expecting and maybe what Surprised you about it as you were going Through it I mean honestly I think that the thing That probably surprised me the most is There were just no rules to it like Every Mentor advisor I had would tell me Something different sometimes you know Especially in the early days and it Really just depended on like am I Talking to the right person that is Interested in investing in the stage I'm At in the sector I'm in in me as a Founder where I live like do all these Things come together and can I tell this Story of what I'm doing in a way that is Going to get this person excited and it Really just kind of comes down to that Relationship in a lot of ways and like Whether or not you can communicate that Whereas I think before you know I sort Of was like you know you read those like Articles or you see the things on Twitter and I'm like okay I have to do It this specific way but none of that is Really the case it's much more fluid Than that I guess

Yeah honestly I was surprised by I think There's just a lack of Standards around Um one like how people dress in early Stage fundraising how people act all of That like are the first money we got was Through an angel investor the founder of Webflow and he just like rolled up to The coffee shop on his skateboard and I Skateboarded in high school and like we Just talked about that and at the end I Was like do I ask him for money like What am I supposed to do like how what Do you exactly say and he kind of just Offered the track and honestly like Early stage fundraising is just always Going to be like that it just depends on That other person even like the firm's Style and it's not as glamorous or it's Not like how they portray it in say Films where you're in a board room and There's like this formal thing it's Sometimes just you might just be sitting Having tea or whatnot Yeah I mean I think the thing that Helped me was realizing that style is Something that you can't really learn Like both of you said like there's so Many pieces online about you should Dress in a certain way you should speak In a certain way like to your point a Lot of people say you should just ask For advice not money right there's so Many so much advice on style and I think that's so different per investor

And per founder so trying to learn that I think is a Fool's errand Um what I think is really really helpful Is trying to understand what investors Are really looking for and then how you Can portray that Um Yeah and I mean we could dive deeper Into that if you're interested but that Was that was like a big unlock for me It's just understanding what is a Venture backable business and is mine One and how do I communicate that to Them forget about Style just let's get To substance and then I'll layer my own Style on top of that Mm-hmm And you all brought up a good point About sort of thinking of how do you Approach it when you're getting so much Advice and you mentioned like Conflicting advice sometimes and it's Hard to kind of know what actually works Especially because fundraising is such a So many nuances involved with that each Investor is looking for something else These investor wants to be pitched Differently and I'm curious if you guys Ever came across a piece of advice that Sort of stuck with you or a piece of Advice that you got that you actually Found was helpful as you were going Through the process I don't know if there was one thing for

Me I think it was about kind of Narrowing in on specific mentors Specific advisors that I kind of trusted More than I wanted to listen to their Advice more than maybe other people Um and and honestly a lot of it is too Just like kind of being able to block Out that noise and and know like you are The one that understands your your Customers your users the best you Understand the problem that you're Solving that's really all that matters All the other pieces like people are Going to give you advice whether it's About fundraising or not and you sort of Have to be able to ignore a lot of it in You know like Kind ways and so Um that's kind of like a big piece of it Especially as someone that it was sort Of an outsider coming in feeling like Well if they're saying it then that's How I have to do it but realizing that Like no I need to do it my way because This is my company I'm gonna I'm gonna Solve this problem the way I want to do It and I'm going to surround myself with People who want to invest in that like I Don't want to be I don't want to portray Myself as someone who I'm not because Then that's not going to go well even if They do write the check because this is Going to be a long-term commitment Long-term you know relationship so it's

Really about kind of staying true to who You are in that yeah I think on a Similar note one of the areas that I Found the most conflicting advice was Um almost like the amount of Transparency you want to have in a Fundraise for example around valuation Cap so a lot of advice was don't tell Them like how much you want to raise That just like beat around the bush Um just you know don't say don't say Stuff and then they'll give you what you Want and then other advice was no tell Them what you want up front what not What I found was the best path in that Scenario is actually just leading with Clarity it's like hey I think we want to Raise in this range frankly don't know Where we're at yet then we'll see where It goes so in general I think Clarity Leads to more rigor and that actually is Probably the best approach I've found For that part of fundraising Yeah Um for me the biggest piece of advice That I got was Um So like when I first started fundraising I I think like a lot of other Founders I Would complain about the fact that it is A game and I was like why do I need to Play this game in order to get capital For my business like you said Amanda Like I know my business and I know that

You know and I kind of went down that Thought process and I got advice from a Close Mentor saying Essentially if you're complaining about The game you're not ready to raise Venture dollars you have to play the Game and in order to play the game you Have to learn the rules so you can Successfully play the game right and you Mentioned that there are a lot of Founders here who want tactical advice And for me I took that and I actually Went and read secrets of Sand Hill Road Which is basically just like a crash Course on how Venture Capital works And for me like I was kind of alluding To before essentially learning that Venture capital is just A capital allocation job but it's a Really really unique version of that Um then you learn that yeah VCS don't Say no they kind of beat around the bush Because they want to potentially invest Later it's not that they hate you or They're being rude that's just part of The game that they're playing right and That kind of goes to every weird Behavior that we see including having Ghost writers for Twitter right like Everything is an incentive In the game and so learning that for me Was incredibly incredibly helpful John is sort of picking through the bad Advice that you got throughout the

Process and that's something I was going To ask you guys about too is sort of What's one piece of advice that looking Back on it just was so far off or that You just didn't find to be relevant at All through the process I think for me it was probably more so The people who I was being introduced to In the beginning Like that precede round a lot of those Intros came from different accelerators Different folks and I ended up finding Myself like pitching an angel group in Tennessee that was a bunch of white Dudes that thought I was the help there Like at this event like handed me his Plate like that's what he did and I'm Thinking like I just like me and my Co-founder like got in a car and drove Down to Tennessee thinking we're gonna Get this check this guy didn't even Trust me to like be an attendee at this Event they're not writing me a check so I think a lot of the early advice that Was bad for me was was who was going to Be a good investor you know like people Are not going to take me seriously if They're not going to see me as someone That is there even they're equal at all So I need to make sure I'm surrounding Myself by people that actually do Believe that I can achieve something That I know something about this space That I understand what students need

What happens in schools that you know I May not have grown up in a tech Environment or worked at you know gone To Stanford or worked at a tech company Before but that I can figure those Things out and connect with the right People in that sense Yeah I think for me Um the advice that really didn't work During Um tough times was like speedrunning the Fundraise to generate fomo and to hike Up your price so I think especially for This panel like if you're raising during A global pandemic or during a Global Financial downturn you actually really Need to prioritize long-term Relationships and not running a process That is opaque and leads people like Kind of basically is misleading people By just like fundraising on speeds so in General the solution to that I found was Especially if I didn't know an investor Before like kind of starting the Fundraise six weeks in advance talking To them a few times not telling them We're starting the fundraise per se and Then starting the process once we had Gotten to know the people that we really Wanted to get to know over those weeks Yeah Um and to that end I think there's like A lot of advice that you get about like And people might feel different ways

About this but like don't talk to Investors unless you're fundraising It is a two-way interview process and if I have more time to get to know an Investor that is a win for me as well Um that kind of leans into the bad Advice that Um that didn't work for me which was Kind of to your earlier Point around Being kind of coy and shy and not saying Certain things that that just doesn't Work for me and it comes off as really Really inauthentic Um and so just being super transparent Has always has I mean recently I guess Worked for me And Amanda what you mentioned was really Interesting sort of this concept of Investors maybe coming to the meeting And you not necessarily fitting the Ideal profile in their minds of sort of What a Founder looks like or kind of What they're expecting and that's Definitely sort of a caution you're Going to come against in any type of Market unfortunately and I'm curious Knowing you all three probably Experience some form of that in the Fundraising process how do you work Through those types of biases from Investors who are just going to be more Cautious just because of your background As a founder Uh honestly I think at first it was

About kind of building up my own Confidence and understanding that I Don't want to make that person money you Know like if they don't believe that I Can do this they don't They have biases against me like I don't They don't have to be a part of my story They don't have to be a part of My Success and owning that took a lot like This is a lot like get a therapist okay So like you got to really work through Some of those stuff but you you really Have to come to realize that like what I'm building is worth it and the people Who will see that are the people I want To work with like to your point of it Gets really hard like you don't have Wins every day or every week or every Month even and so what happens when You're not in a good chunk of time are Your investors going to look at you and Think well someone else could do this Better or are they going to look at you And think like get over here come sit Next to me and like let me help you Figure this out and so that it kind of Just comes down to like you know as much As the investors themselves are Filtering through people and deciding Who they want to work with like so are We right like we're trying to figure out Who we want to work with who's going to Support us who's Who who we actually want at the table

And and making sure that they there's Room for them Yeah I mean I totally agree with that But um on a different point I do think Twitter is the greatest equalizer these Days and you can raise with a Anonymous Profile picture you can raise without Even like people knowing your name so I Think the Norms have changed a lot since Fundraising on Twitter has become more Common and actually our like series a Lead and our seed lead they boast Um kind of followed me followed us on Twitter before we even met in person so Honestly like sharing your thoughts your Thought leadership the work you're doing And letting that lead is more important But obviously I think showing up in Person you cannot avoid some sort of Bias or some surprise they might have I Think in general I just showed up to Fundraising meetings and you know ripped Jeans hoodie but they already saw the Track record of work so I think you Definitely want to just start with that And then not let them change their mind Due to bias Yeah the comment you made about Twitter Is huge I raised most of my money off of Twitter Um but I think the rest of it is hard For me to answer honestly as like a Man who went to an elite college so I I Think I'm gonna sit out of that one

Well focusing on this raising on Twitter Concept for just a second maybe if you Guys want to talk about sort of how you Navigated that process and maybe do you Have to tailor the pitch or tailor sort Of what you're putting on there for that Platform specifically and what does that Look like I didn't raise on Twitter so I'll let You go Yeah I mean I can I can kick it off uh For me I think Twitter is really has Been a tool for me to just get to know People and get them on a call Um And so that happened with a lot of my Investors it happened with Natasha at TechCrunch that's how I met her Um and I think just treating that like a Typical relationship you know again just Like let's break this down into Something really simple and not over Complicate it basically people just tell Jokes and then if someone tells a funny Joke I'll just DM them and say hey that Was funny or like in Natasha's case she Would write a really interesting article About something in the edtech space of Which I care a lot about and I would Respond really thoughtfully to her and We would just have a conversation Um And kind of like you were saying earlier Just starting that conversation earlier

And I started talking to like Alex Lieberman for example one of our Investors from morning Brew he and I Started talking like Six months before I asked him to get on A call to talk about the fundraise Because we just built that relationship And I did that with a lot of other Investors as well Um so yeah just constantly on there Dming people yeah yeah I think thinking From first principles it's still Conversations with humans at the end of The day but I do think like building a Brand and kind of raising through Twitter is still playing with fire Because the algorithm kind of Prioritizes memes spicy content so You'll find yourself posting that and Then you'll be engaging with actually Our one of the first tweets that we did As a company was retweeted by this Account called praying for exits which Was really big at the time and you never Know which species hate that account Which VCS think you're then a meme Company like obviously we stayed away From that but you just have to be Careful there Mm-hmm And I know something we all talked about As we're sort of prepping for this panel And it's come up already a little bit But the concept of when you're

Fundraising regardless of the market Conditions you hear no a lot and it can Be kind of hard when you're working on Something you're building in it in and Out every day to consistently hear no And I'm curious how you guys navigate That and I'm sure in today's environment Just with how Ventures just being more Choosy about where to invest I'm sure Founders are hearing no even more often I mean I think a lot on sometimes Hearing no is sort of a like a good Thing because then at least you know Like this person's out I'm moving on I Can go down my list go to the next Person sometimes you don't even get a no You know it's very like kind of Wishy-washy you know like like you said Like they want to like you know wait Until there's a chance later and so Getting a no sometimes good because then You're just like okay well it's clear That this is not right time right person Right place right thing like something's Not right Um and then I think it's just about sort Of trying to figure out like If you get a no if you get if you can Get a reason for the no which sometimes You you don't get a real reason Um but it's sometimes it's just really Trying to figure out like what was it That didn't work for this person is it Something that I can work on is it

Something in my control or is it more That I just need to talk to different People this just wasn't the right fit so It's just it's it's a process because You sort of have to like like when You're fundraising you're just like Constantly iterating on on it like every Single day you're updating your pitch Your pitch deck you're thinking about Like how you know who else should I talk To or how else should I present this or You know when I said it this way it Really clicked when I said it this way Like they didn't quite get it so that's You sort of just like take the feedback And you just keep going Yeah agreed like getting nose is Actually really good because as a Founder you have this pretty limited Perspective on your business and having Those outside Um opinions and even just like pokes and Like where you're missing data and like Um a reason VCS often passes because Like Market sizing um isn't to their Liking or your go to market isn't super Fleshed out so having Um almost like that feedback loop and Then forcing yourself to then answer Those questions can even lead you to Decide to Pivot the company or approach It from a different angle and then also We found that how elegantly and Gracefully someone has said no has also

Changed our relationship with that VC so Um Bain was the lead for our seed round And they were actually a group that gave Us a really well thought out no and it Was like a lot of data reasoning and Like these are the things you need to Answer for us to do your seed and like That's actually exactly what we did and Honestly like I really respect firms That can do that really thorough Grace Useful rejection Yeah absolutely I think the way that I Think about fundraising in general and Hiring and a lot of stuff that we do is That it's more of a Search than a cell right and so I think A big part of that of course is Describing your business in a really Compelling way to a venture capitalist And improving that pitch over time based On their feedback to both of your points Is is incredibly important but also Hearing those no's and like that's Basically just this was not the right Person and I'm just going to continue Searching for that right Firm or a person or whatever That reframing kind of made it seem like Okay cool this was just mutually not not A good fit the best thing is when you Get a DM a couple years later of like Man you're my biggest regret you're like Talking about the actual pitch process You're either there on the phone you're

In person you're on Zoom you're chatting With a potential investor is there a Question that threw you guys off at some Point during the process like a question You wish you had prepared for before the Pitch that you now will never sort of Forget going out again I wish I'd Prepared for this question How I Don't have enough top my head I think in General like a lot of VCS not not a lot Of VCS actually think from a historical Perspective or um I think when I was Doing our precede I never really Prepared for the question of like why Now Um I think also like um just as if You're a younger founder you don't Really learn internet history and like Waves of different types of software and So even looking at like previous Cycles Can lead you to like a really good Answer for Market sizing uh timing of The business even like go to market Motions like what didn't work before What will work now because of changes to The landscape like that can lead to a Really compelling pitch Mm-hmm And thinking ahead to raising future Rounds now that you guys have all raised A couple of rounds what how will you Change your pitch next time what have You learned like what's the one thing

Your biggest thing you've learned going Through this process that you will now Take and sort of use to improve the Pitch going forward I mean I think the pitch in general has To evolve as the company evolves like Every round is different you know like When someone's investing in a pre-seed Company that's really about the founder The team you know the idea but but it's Much more like vague than just like you Know are your numbers right and so I Think as as the company is maturing the Pitch has to mature to to be able to Like weave together those the actual Numbers like how are we doing what's Happening what are we going to do next And you just you have to be a little bit More uh you know like Put together in some of those pieces Um but but I think it's just a matter of Like staying true to you know I think The things that that always made me Stand out were the were some of those Like how I'm gonna tell this story what My passion is about this and that's the Kind of stuff that needs to stay there Right that's going to unlock things That's the that's the magic of a pitch Two of whether it's a VC or you know Someone I'm trying to hire or sell to It's like there's some there's something In that pitch that is magical don't lose Sight of that and that's the been that's

Probably the the biggest thing Yeah I think for us like we'll continue To add more data around like current Trends and like what has evolved since Our last fundraise I think that's always Interesting to include and then I think Something that's a bit underrated is the Team slide like Um it's still I still see most team Slides just static pictures and logos And I think for us like it's I think a Lot of people might think it's Wishy-washy in earlier stages and I Think it is but in later stages almost Like what your team stands for what um Kind of how you quantify the bar for Your team because ultimately at some Point it's really about execution and Not the idea or the market Yeah Um I mean like you said like we raised a Pre-seater a cedar and I think a lot of It um it is just going to be a different Pitch so just including things that are That are more relevant for Um for the future but I think also and Then you're alluding to this just Putting more of myself in there and Making more conversational I the way That I ran my pitch meetings was were Basically like I had a really really Short pitch I condense it down as short As I possibly could

And there was basically no time for Conversation or interjection or anything And then ran the rest more like a Conversation and that worked but I might Elongate this and make the pitch itself More conversational and again that's Like a little more detailed tactical but Um but that's something that's kind of Been in the back of my mind And since it's come up a little Sort of throughout a lot of these Answers I'm curious how do you guys Strike the balance when you're pitching Between sharing the mission like showing How passionate you are about what you're Trying to build in but also selling the Numbers and making an investor see it as A business that they want to back as Well in addition to the mission I think it's just about weaving those Things together and kind of knowing When to share certain information at What time you know in my first call with Someone I might not just like dump all This data on them but rather like kind Of weave that together Um I last time I raised I found a lot of Use in just like pulling putting Together a whole like kind of Interactive notion Doc and that made it So that I could kind of weave in you Know slides and a video and like it just It could bring together the information A little bit better and so I think it's

Just sort of like how you kind of do That with all how you like balance The things that you're actually doing You know putting like names and faces to Your users you know to your customers And then showcasing like what that means From the business side too and so Finding ways to kind of balance both Sometimes within one slide or one Conversation Yeah I think you as a Founder Technically have control over what you Can and can't share and so what we've Always tried to do is think about what Data an investor needs in order to make A decision and what's sort of optional Like if they're getting into conversion Rates for like XYZ it's probably they Just lack conviction and so you always Have to remember you can you can reject Investors and fire them and you can Essentially just say here's what we have And that's all you're going to get and Then move on to the other investors that Can make the best use of that data yeah Um I mean there's no Silver Bullet when It comes to crafting a pitch like I Mentioned this uh to all of you earlier Um when we spoke Creating our pitch took Like a month of day in day out story Crafting sitting down with um with some Of the partners at pair VC and their Accelerator and essentially being like

What are the questions that investors And specifically Venture investors want To have answered for them right and These things are clear they are is the Market big enough can you scale to uh to Kind of capture this Market quickly Enough can you fundraise again there's a Lot of really simple things that they're Looking to answer and like you said Amanda like you have all of this Information whether it is data about the Traction in your product or your team or Anything strategically or anything right And then just puzzle piecing these two Things together in a way that sounds Enjoyable to listen to Um It takes just a long long time but Thinking about it like literally with Sticky notes and a puzzle where there's Data And passion and you're kind of putting These things in order was was helpful In looking at some of the uh questions Submitted from the audience thank you Everyone we're getting quite a few Actually which is great Um one that I think would be really Interesting to hear all of your takes on Is how do you know when it's the right Time to raise money Um uh I was just talking about this one Uh earlier yesterday I honestly I think That the the right time is like if you

Can Um that was sort of a learning that I Had so you know like when we raised our Series a uh even our seed round both of Those were earlier than I had originally Planned to do it but if you have Momentum if you have interest and you See that there's an opportunity like That's the best time to do it and in Retrospect then it looks like you know Oh like she raised this money right Before the whole Market crashed she was Super smart but it wasn't that it was Just like there was interest now so I'm Just gonna do it now so we have the Capital of later Yeah agreed I think it's just testing The waters a bit like never really like Don't commit to a fundraise until you Think Um the environment looks good you feel The interest like you're ready Um and then after the first one like the First one is the hardest to choose Actually in terms of timing and then After that really is the milestones and You can actually get feedback from those Investors in your round whether or not They do your rounds like what like that Next one is Yeah I think asking investors right and I think to your point having investors Is makes that easier because then you Just ask them like hey do you think

We're ready that helps with what you Mentioned about will you be able to Successfully go out and do it but then I Also think is your business ready is Another question right there are a lot Of people who Um Even if you can fundraise maybe it's not The right time right maybe you just Raised some money a year ago You could kind of fundraise a bit more Freely and right now based on price I Think people are being a bit more Hesitant so Um Considering both where is your company At is the team ready are you ready do You think that you can get more traction Reasonably before you run out of money All those things are one thing to Consider but just asking investors that You have on your cap table and if you Haven't fundraised literally going out And asking investors That haven't invested like hey this is Where I'm at what do you think that is a Question that I've had answered and it's It's really useful conversation to have That actually leads perfectly into a Question from the audience that said What is the most valuable question you Have asked in VC Um I think it's really useful to push them

On how they're thinking about that that Market and what they're seeing across The space what's missing like what like Really digging into their thesis on it Because they've gathered a lot of data From a lens that I didn't right like They have access to things that I may Not and so really understanding how They're thinking about it can really Help me figure out what they want to be True what their values are and whether Or not we're aligned Yeah I think probably you could ask an Investor like why Founders hate working With them or do the back Channel Yourself or look at their VC guide and See if they got any one star reviews Like why that was and ask them Point Blank Um yeah I think just in general due Diligence is Um the best thing you can do Yeah Um for me it's the most helpful question Is actually after the check has been Written I ask every investor who's Invested why did you invest and why did You almost not invest and that has been Incredibly helpful feedback just telling Us where the holes in our business and What are the really really strong points Um And that's allowed us to improve for Sure

And I'm going to combine a couple of These questions here because we have a Bunch of questions regarding approaching Equity and sort of deciding how much Equity you want to both give in these Different fundraising rounds to Investors and sort of thinking about Early employees as well and sort of just How did you guys navigate sort of Thinking about that aspect of Fundraising Definitely with a lot of support from You know my mentors advisors because it Is really challenging to figure out what The right balance is you know obviously We want to give away as little as Possible investors want as much as Possible so it's just you're trying to Figure out where that happy median that Compromise is going to be and obviously Like making sure that you're protecting What the founder has like we want to Make sure we have enough too to stay you Know invested in it and we want to make Sure we can get the team compensated With it and so it it's really it's Really challenging and it's definitely Like one of the harder Parts I think of Like when you really get down to like The negotiations of things but I think You have to sort of go into it knowing What you're willing to where is your Limit what are you willing to do and Keeping that in mind as you go and if

You know you need to you need to walk Away from something because it's past That and then you do Yep I think in general there's like Bands of equity you give up at every Stage and if you're far to either end of It you that's like a red flag with that Particular VC or however those Negotiations are going and in general Like my attitude has always been be as Cheap as possible in terms of BC give up Or the equity you give out to VCS and be As generous as possible with employees So you want to protect internally and Not give out that much externally Yeah I think it's one of those Interesting things where there are a lot Of rules of thumb which I think are Really important to equip both you and Employees so every time I start Negotiating with an employee for their Equity I send them a bunch of materials On like what they should expect so They're also well informed Um and I think that that's really Helpful to to kind of keep uh keep a Check on yourself and make sure that Everything is kind of going Um smoothly and according to plan Um but also it's just so Case by case Right every time you talk to an investor You really need to consider that on its Own and every time you speak to a new Employee I believe you need to really

Consider that as its own thing and just Continuously keep track of your cap Table right like I think rules of thumb Again are really helpful but Being opportunistic is one of the most Important things that we have at our Disposal and so I think keeping each Deal as a singular conversation has been Helpful and since we have only have time For one more question I feel like a lot Of this has sort of focused on the Struggles of fundraising fundraising is Hard but I'm curious maybe to close out What's one fun aspect of fundraising and What is the funnest part of going out Into Market I mean you go in with a you know low Bank account you come out with a big one That's the most fun um no I feel like it It's it's really hard and it's Challenging and it puts you through the Ringer but it also like does make your Business better you're able to explain Things in a much more concise way like I've always felt like the process itself Is very good to go through because it Just like is rigorous and I feel like The it just like it's validating you Know like when someone writes you a Check it means that they truly believe That you're going to be building a Billion dollar several billion dollar Company and that is Huge you know that I'm like calling my

Mom just like look I did it you know Like it's it's it's really it's exciting It's a really exciting thing that can Happen Greed it's like the social and emotional Validation like the announcement day Like when we had our Tech crunch piece Come out for like the seed and the a it Was always I think I got like 10 000 Notifications and probably couldn't Check my phone for a day and then took Like a month to sort through messages And Um you find all sorts of interesting Messages in the Um in the Inbox and like I think I've Had a couple people I've like looked up To for years like reach out to me versus Vice versa so I think um yeah Fundraising is a really good path to Like validating the company but also Yourself if you're on that Journey yeah Um absolutely it's like the only Punctuated event that we have as Founders like we we don't get promotions We don't get raise it like that doesn't Happen for us Um but as people in running Venture Basketball companies that that is really The moment that we can kind of look at Our family and say hey look I'm doing Something cool Um so that's definitely fun I think the Other thing is both of you mentioned

Really using the process as a way to Improve because I'm not gonna lie it is Really really difficult and it is Incredibly emotionally taxing Um but looking at it as a product and Something that you're iterating on every Single day I've definitely noticed I can Describe my company way better now than Before I even like our go to market Strategy I remember speaking to an Investor and they were like hey have you Thought about this and I'm like It is rare that I say no but I literally Have not and that is such a good idea And we just started like Going back and forth we had a great Conversation and they ended up investing And that Improvement really really Helped the company Um and so kind of going in recognizing That it is going to be difficult but It's also an opportunity to speak to Largely incredibly intelligent people Who have seen many companies similar to Um similar to yours and kind of get that Feedback that that's been really Fulfilling mm-hmm well we're out of time So please join me in thanking our Panelists for being here today thanks Guys

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