00:09I'm Brad Flora I'm a group partner here
00:12at YC and I'm going to be talking about
00:13how startup fundraising works today like
00:16I said I'm a group partner at YC and
00:18what that means is that I read
00:20applications I interview the startups
00:23that apply and then I work with them to
00:25try to make something people want and
00:27one of the topics that people ask about
00:29all the time at YC is fundraising in
00:32fact it's probably the thing that we get
00:34asked about more often than anything
00:36else and the reason for that is because
00:38as Paul Graham wrote years ago raising
00:41money is the second hardest part of
00:43starting a startup after making
00:44something people want so let's take a
00:46quick tour of all the awesome stuff that
00:48YC's put out about fundraising over the
00:49years first there's the Paul Graham
00:51essays he wrote the fundraising Survival
00:53Guide how to fund a startup how to
00:56convince investors to invest in your
00:58company and even wrote a great essay
01:00about understanding investor herd
01:02Dynamics all of the stuff's online you
01:04can see the links below you should check
01:06it out years later just a little bit ago
01:08YC president Jeff Ralston posted a
01:11terrific guide to raising a seed round
01:12where he covers everything from start to
01:14finish that you need to know the Nitty
01:16Gritty on how to raise a seed round and
01:19he gave a great video presentation at
01:21startup School a few years ago where he
01:22presented that material it's on YouTube
01:24you should check it out it'll tell you
01:26how to raise a seed round finally we've
01:28posted a lot of tactical guides about
01:30specific aspects of fundraising how to
01:33build a seed deck how to pitch your
01:35startup how to get meetings with
01:37investors and how to raise money online
01:39for startups using platforms like Angel
01:41list we've even got something about the
01:43different types of investors and their
01:44incentives so if you really want to get
01:46specific and drill into stuff there's
01:48content for you that you can find what I
01:50didn't want to do today is just rehash
01:52all of that stuff because it's already
01:53out there what I wanted to do instead is
01:56talk about some of the misconceptions
01:58and myths that we see as YC Partners
02:01when we work with Founders Founders out
02:04there are consuming all sorts of
02:05information in the media and a lot of it
02:07is about startup fundraising and there's
02:10some things in there that just are not
02:11true that we're going to talk about the
02:13goal of this talk is to catch you up on
02:15how fundraising actually works today and
02:17we're going to do that by exploring
02:19seven fundraising myths and for each one
02:21of them we're going to talk about the
02:23myth the reality behind the myth and
02:25then look at some great YC companies
02:27that bust that myth before we get
02:29started just a little bit more about me
02:31I'm a YC partner but I've also been on
02:33both sides of the table as a founder and
02:35an investor from 2008 to 2014 I was
02:38building startups and the company that I
02:40got the most success was perfect
02:42audience which was an ad retargeting
02:45startup for small businesses I took
02:47perfect audience through the YC summer
02:4811 batch 11 years ago and we raised a
02:52million dollar seed round after demo day
02:54I hired a bunch of great people we grew
02:57to three million dollars in revenue and
02:58we were acquired in 2014. after that
03:00acquisition I got really into investing
03:03in startups it started with Angel
03:05Investing where I was writing just a few
03:07checks five thousand dollars ten
03:09thousand dollars into YC companies that
03:12I thought sounded really cool at demo
03:13day but I got hooked the thrill of going
03:16and meeting Founders finding out what
03:18their deal is trying to figure out are
03:19they making something people want should
03:21I invest was too much for me and
03:23suddenly I was raising a fund with some
03:25friends to scale up and invest in even
03:27more YC companies and so through that
03:29fund I invested in 150 YC companies and
03:32the good news for my backers is that we
03:34got into some great companies you may
03:36have heard of a few of them deal open C
03:39retool razor pay it was really awesome
03:41to help those companies raise their
03:42first round funding and it's been a lot
03:45of fun being involved since eventually
03:47though I joined YC as a group partner
03:49and I get to do both sides I get act as
03:52a Founder as a fellow peer to the YC
03:54Founders and help them figure out how to
03:55make something people want and then use
03:57my investor experience to help them
03:59figure out how to raise money so I've
04:01got a good view of this I've been
04:02involved in a lot of seed fundraising so
04:04let's get started with these myths and
04:06for the first one I want to talk about
04:07is this idea that raising money is
04:11glamorous what's the image in your head
04:13that you think of when you think of
04:15startup fundraising for a lot of you it
04:18might be something like this this is an
04:20image of Shark Tank and it's a
04:22television show where entrepreneurs they
04:24dress up they make a sign they get a
04:27bunch of materials and they pitch a
04:29bunch of investors at once called sharks
04:32and these are a bunch of people of
04:34varying levels of investor expertise who
04:36hear the pitch ask a bunch of uh nosy
04:39kind of pushy questions and then fire
04:41offers that the founder rapid fire and
04:44so if you watch this you may be thinking
04:45gosh I've gotta put a whole presentation
04:48together like this and I'm gonna pitch a
04:50bunch of people and they're going to ask
04:51me all these tough questions and it's
04:52going to be this high pressure situation
04:54nation that I've got to figure out the
04:56reality is that fundraising actually
04:58looks like this this is a picture taken
05:01in the creamery which is a now departed
05:04Cafe in San Francisco notice what's
05:06happening here it's just a bunch of
05:08people sitting in chairs talking quietly
05:11amongst themselves right it's just a
05:13bunch of coffee chats that's how
05:15fundraising actually looks that's what
05:17it actually feels like is just sitting
05:19in a cafe talking to someone Shark Tank
05:21the pitch competitions the business plan
05:23competitions they're just for show
05:25they're marketing events for the
05:27organizations that put them on and in
05:29fact a lot of the investors at these
05:31things they don't invest they're just
05:33there to meet other investors and hang
05:34out and even on Shark Tank I think Mark
05:37Cuban recently said that even though
05:38he's put 20 million dollars into these
05:40companies he hasn't made a dime yet he's
05:42still in the red actual fundraising is
05:45just a bunch of one-on-one meetings on
05:47Zoom over and over again while you try
05:50to collect checks and convince investors
05:52It's a Grind okay what you see here is a
05:55diagram that was made by an actual YC
05:57company called fresh paint that shows
05:59what an actual round of fundraising
06:01looked like for their startup you see at
06:03the top the company in each one of these
06:05circles and squares represents a
06:07different investor that they met with
06:08and when the boxes are connected it's
06:10because that investor made an
06:12introduction for them they met with 160
06:14investors and 39 of them said yes which
06:17is a very high conversion rate but the
06:18check range was all over the place they
06:20had people write 5K checks and people
06:22write 200k checks all right not
06:24everybody with some fancy VC they could
06:26write a giant check and it took them
06:28four months and 18 days to get through
06:31all these meetings and close all these
06:33deals and that was to raise 1.6 million
06:36dollars fundraising was painful and it
06:38was a grind but it was pretty
06:39straightforward it was just a bunch of
06:41conversations they've written a great
06:43blog post that's where this image comes
06:45from that you can check out should
06:46definitely read it so great example of
06:49what it's actually like to raise money
06:51okay the next myth I want to talk about
06:52is this idea that I need to raise money
06:55before I can start working on my startup
06:57all right we see this a lot with
06:59Founders we meet people that have a big
07:01idea which is great and the next thought
07:04they have is well gosh I guess I need to
07:06raise money so I can build my big idea
07:08but that's not how the best Founders
07:10actually think about fundraising the
07:12best Founders they build the first
07:14version of the product first even if
07:16it's a simple almost toy-like version of
07:20it and then they go get some users for
07:22it and then only then when they see that
07:24people are starting to use it and maybe
07:26there's some value being created do they
07:28start thinking about raising money and
07:30the reason for this is that it's cheaper
07:31than ever to build a prototype of a
07:33product to build a first version okay
07:35it's cheaper than ever to host a website
07:37and and build software it gets easier
07:39and easier and easier every year and
07:42also it's easier than ever to find
07:43potential users you can get users on
07:46platforms like product hunt on Hacker
07:48News you can find users on social media
07:50Twitter LinkedIn everybody's on the
07:53internet today and you can use that to
07:55find early people to try out your
07:57product and when you do this when you've
07:59got a little bit of product just a
08:00little bit and a few users for it it
08:03immediately gives you a great deal of
08:05Leverage all right you've gone from that
08:08person waving the pitch deck around
08:10trying to figure out how to find 20
08:11million dollars to someone whose startup
08:14is in motion and investors want to jump
08:16on trains that are in motion here's an
08:19example solugen is a YC company from the
08:22winter 17 batch and they are a chemical
08:24manufacturing startup they literally
08:26make chemicals and sell them as you can
08:29imagine that is a capital intensive
08:31business it requires a lot of money to
08:34build a facility that can make chemicals
08:36and sell them at scale and a certain
08:38type of founder that had this idea would
08:41then make a pitch deck and go around
08:43telling investors I need 10 million
08:45dollars I need 20 million dollars to
08:47build the menu manufacturing plant to
08:49make these chemicals the solution folks
08:51chose a different path which is first
08:53they built a tiny version of their
08:55reactor that fit on a desk but it worked
08:57next they built a slightly larger
09:00version of that that could actually make
09:01enough hydrogen peroxide to sell and
09:04they took that to YC when they applied
09:06for the winter 17 batch and during the
09:09batch they started making enough
09:10hydrogen peroxide using this slightly
09:12larger version of the machine that they
09:15could go and sell it to First customers
09:17turned out that hot tub supply stores
09:21needed hydrogen peroxide to sell the
09:24people that add hot tubs and so they
09:26were making ten thousand dollars a month
09:28selling hydrogen peroxide to hot tub
09:30supply stores not a ton of money but
09:32let's step back for a second if you were
09:34an investor and you were trying to
09:36invest in a chemical Manufacturing
09:38Company who would you back the person
09:40with the pitch deck asking for 20
09:42million dollars or the people that have
09:44built a first version of this even if
09:46it's small and making small amounts of
09:48the product and selling it to hot tub
09:51supply stores which is hardly a huge
09:53business but it's something
09:55well investors clearly want the second
09:57Solid Gym is able to raise four million
09:59dollars for to get started on their
10:01company because they'd already made some
10:03progress and today they've since raised
10:05400 million dollars and they've scaled
10:08this up to having a full manufacturing
10:10plant let's talk about our next myth
10:12this idea that my startup needs to be
10:14impressive to raise money I've got to
10:16impress people with my startup but my
10:19startups startup is not very impressive
10:20so how can I ever do this well the
10:23reality is you don't need to impress
10:24investors you need to convince them and
10:28that's a slightly different thing see
10:29most startups seem terrible at first and
10:32in fact the best startups seem the most
10:34terrible at first so let's take Airbnb
10:38what was it it was a Marketplace for
10:40renting an air mattress on someone's
10:43terrible idea doordash
10:45food delivery for the suburbs where it
10:48takes longer to get everywhere and no
10:50one's ever started a delivery company
10:52terrible idea open c a Marketplace for
10:56selling Collectibles that only exist on
10:58your computer and can only be paid for
11:01with magical internet money what but
11:04investors get this they know that your
11:07startup is going to sound unimpressive
11:08early on investors are pretty smart they
11:10get it and in fact they get bored when
11:12founders try to impress them okay really
11:15try to win them over and sell to them it
11:16bores them about 11 years ago and I did
11:18YC I had a chance to have a five minute
11:21meeting with Michael Moritz who at the
11:23time and it was a partner at Sequoia
11:25capital is legendary VC and I was so
11:28excited for this meeting I made a fancy
11:31deck I practiced all these lines I was
11:33going to use on him to impress him and
11:35conv and get him to invest in my startup
11:37and I sat down with him and I opened my
11:39laptop to get the slides out and he
11:42stopped me and just said I prefer to
11:44just talk about the business you're
11:45building and I was completely disarmed
11:47because I wasn't ready for that I was
11:49ready to impress him not to try to just
11:52talk about the business that I was
11:53building and we see this similar
11:55thinking with a lot of Founders at YC
11:57where they come to us they don't
11:59explicitly ask us this but they more or
12:00less say Brad what are the magic words I
12:03need to say to make investors want to
12:05invest in my startup and the reality is
12:07that it's not about magic words it's
12:09about making something people want right
12:13it's about making a product getting it
12:16into users hands and creating some value
12:18for them and then just explaining how
12:21there's a one percent chance even just a
12:23one percent chance that it can get huge
12:25and using plain simple language to do it
12:28that's how you convince investors okay
12:30if investors aren't investing it's not
12:33because you didn't say the magic words
12:34it's because your startup isn't good
12:36enough and you need to make your startup
12:38better and so have these conversate you
12:40make your startup better and you just
12:41explain it to people and talk about it
12:43like a human and do it over and over and
12:45over again because again startup
12:48fundraising is a grind here's an example
12:49of a company that did a great job
12:51convincing investors when they met with
12:53them this is retool and retool makes
12:55software for building internal tools
12:57it's a great company they raise their
12:59seed round you see the founder David and
13:01one of the CEO and co-founder by just
13:03meeting a bunch of investors in coffee
13:04shops in San Francisco I was lucky
13:07enough to meet with David and he had no
13:08DAC instead he just opened his laptop
13:11and showed me the software on his
13:13computer and he used that early kind of
13:15crude version of retool to make a crude
13:18but simple internal tool a little web
13:22and then he talked about why his early
13:24customers really liked it and we're
13:26getting some value from it and just
13:28seeing this seeing him show me the
13:29product and talk about what his
13:31customers were making of it put in my
13:34head this idea that a lot of companies
13:35probably are going to need this I was
13:37convinced he didn't impress me he didn't
13:39try to wow me he just showed me and
13:42talked in a reasonable way about what he
13:43was doing and that convinced me I wrote
13:45a check and today that company is at a
13:47four billion dollar valuation wasn't
13:49about doing a fancy pitch but it wasn't
13:51about magic words it was just about
13:53making something and then talking about
13:55it with me the next myth I want to talk
13:57about is that raising money is
13:59complicated slow and expensive if you
14:02read a lot about fundraising in the
14:04you might think that it involves raising
14:08giant rounds from big name VCS why is
14:11that well let's take a look at
14:13yesterday's TechCrunch headlines about
14:15fundraising we've got a story about
14:17Shopify Mark Vision locket Sprague what
14:20do we see folks what's the common uh
14:22denominator here gigantic numbers and so
14:26you're reading this at home and you're
14:27just trying to think how can I raise
14:29twenty five thousand dollars to quit my
14:31job or spend more time on this or get a
14:35Hosting account for the website that I
14:36want to build you're not thinking about
14:38a hundred million dollars gosh maybe
14:40this isn't for you well the reality is
14:42is that all the rounds you read about in
14:43the news are series A's and growth
14:45rounds you don't read much about the
14:47actual you don't read anything about the
14:48actual first rounds of funding that
14:50companies raise why because it's boring
14:52okay it's really boring we already
14:55established that there's no glamor in
14:57the actual early fundraising that
14:58startups do so it never makes the press
15:00these typical A and B rounds are huge
15:02right you raise 10 to 50 million dollars
15:04they take months to close and you pay
15:07hundreds of thousands of dollars to
15:08lawyers and legal fees to get these
15:10rounds done the good news is like I said
15:12that's not what a lot of these rounds
15:13look like your typical seed round is
15:16actually much smaller 500 000 maybe a
15:19couple million dollars you can close it
15:20in weeks if not days and there's no
15:23legal fees and this is the same for if
15:25you're trying to raise a precede or just
15:27trying to raise fifty thousand dollars
15:28from friends and family you can do that
15:30quickly and there's no need to get
15:32lawyers involved why is that well in
15:352013 YC created a new standard
15:38fundraising document
15:40called the safe the simple agreement for
15:43Equity so initially this was made by YC
15:46to be the new standard document that all
15:50YC companies would use and it turned out
15:52for fundraising and it turned out to be
15:54so great that now every startup uses
15:56this to raise their money the safes are
15:58awesome first off it's easy to
16:00understand it's only five pages long
16:03uh it's really fast to close an
16:05investment using a safe there's only a
16:07couple terms to discuss the amount of
16:09the investment the valuation cap of the
16:11investment and then the discount and
16:13guess what nobody does discounts so
16:15there's only two terms that you really
16:17need to discuss when closing a safe and
16:19finally they're cheap you don't need
16:21lawyers to send them also the safe is
16:23just on the YC website if you Google why
16:25combinator safe you can find the
16:27document download it to your computer
16:29and use it this afternoon to close an
16:31investment in your startup how cool is
16:33that safes are so simple that there's
16:35even a website called clerky it's a YC
16:37company from my batch summer 11 that
16:39lets you send and sign them in just a
16:41few clicks safes give Founders
16:43fundraising superpowers and you don't
16:46have to wait months for investors to get
16:49organized and for lawyers to review
16:51stuff founders today just take all the
16:53meetings they sign a bunch of safe and
16:55they raise Millions for their startup in
16:57just a few clicks and this quick and
16:59cheap fundraising gives them more
17:03when they're talking to investors here's
17:05an example you could build your company
17:06like Azure bio so this is a biotech
17:09startup from the summer 19 match that's
17:11developing cancer therapies again
17:14Capital intensive business and the
17:16typical first rounds of funding are tens
17:18of millions of dollars for companies
17:19like this and so Founders go they make a
17:22pitch deck and they've got to go get
17:23this money before they can start working
17:25on the on the startup the founders of
17:26Astra came into YC with just the idea
17:28and they were able to raise the first
17:31round of funding using safes quickly
17:33from Angels this is pretty novel for a
17:35biotech company and using that first
17:37million or so that they raised they
17:39could accelerate their progress they
17:41could make more progress in the lab and
17:43when they were ready to start talking to
17:45larger investors in the Pharma space
17:47about a proper round they've made a lot
17:49more progress and they had more leverage
17:51in talking to those investors they've
17:53since raised over 150 million dollars
17:55but that first million that they raised
17:58in safes totally changed the power
18:00dynamics for them when talking to
18:01investors the safety change the game for
18:06myth is this idea and I hear this a lot
18:08hey if I raise money I'm going to lose
18:10control of my company
18:12well the reality is that seed rounds
18:15today give Founders more control than
18:18ever okay Founders have had more can
18:21have more control over their companies
18:22today than ever in the history of
18:25startups and why is this it's because
18:27when you raise the safes you don't give
18:28up any board seats all right there's
18:30there's no board seat nonsense in safes
18:32after you close the investment it's
18:34still just you and your co-founders
18:35calling the shots there's no
18:37shareholders after you close money with
18:39safes the investors on safes gets shares
18:42in the next round okay so no Shares are
18:45actually changing hands and there's no
18:47information rights granted in safes so
18:49there's nobody like requesting to look
18:51into your books looking over your
18:52shoulder you get to choose how and when
18:55to update your investors when you raise
18:56money with safes so again Founders
18:58raising millions of dollars they're only
19:00selling 10 to 20 percent of their
19:01company and they're keeping total
19:03control of the companies and when you do
19:06that you can build the company the way
19:08you want and Answer to No One except
19:11your customers well pretty important but
19:13instead of answering new investors you
19:14answer to your customers when you raise
19:16seed rounds today here's a great example
19:18you could build your startup by zapier
19:20they describe themselves as three dudes
19:21from Missouri and zapier is software
19:24that help you set up Integrations if
19:27you've got one app that you use in
19:28another app and you want them to talk to
19:29each other you can use zapier to set
19:31that up it's awesome they did the YC
19:33summer 12 batch and they applied with an
19:35early version of their software they had
19:37a few customers and they raised over a
19:39million dollars from angels and small
19:40funds at demo day and because they did
19:42that because they raised on safes and
19:45they just raised a bunch of checks they
19:47were able to run their company the way
19:48they wanted and for them 10 years ago
19:50that meant going fully remote 10 years
19:53ago a decade before it was cool for
19:55startups to do that it was pretty weird
19:56at the time and they ran their company
19:58the way they wanted to they spent the
20:00next decade just delighting thousands
20:02and thousands of customers and they also
20:04made the decision to never raise money
20:06again they never needed to so folks
20:08thinking gosh if I raise money I'm
20:10always going to be indebted to investors
20:11yada yada no maybe later if you raise
20:14these crazy priced rounds but for the
20:16early money that you raised on safes you
20:19have total control and you can be like
20:21the zap your Founders and never raise
20:23money again and today that's 100 million
20:26dollar Revenue business and they only
20:28raised money that one time now what
20:30about bootstrapping you might be
20:31thinking I should bootstrap my company
20:33well everybody bootstraps it first
20:34that's true but I want to tell you that
20:36bootstrapping your company forever sucks
20:39and here's why so first off when you
20:41bootstrap forever and what I mean by
20:43bootstrapping I mean
20:45um funding the company out of the
20:46revenue that you make from customers
20:48it's scary all right you're always about
20:51to shut down you're always about to run
20:52out of money it's miserable because you
20:54don't have any money to pay yourselves a
20:56decent salary to live on it's
20:58distracting you have to go into
20:59Consulting in order to make the money
21:02you need to keep working on your
21:03products sometimes you have all these
21:05detours when you're bootstrapping and
21:07then finally the odds just aren't great
21:08there are very few examples of 100
21:11gigantic bootstrapped companies and I
21:14think if it was the way to go there'd be
21:16a lot more of those I actually want to
21:17propose the definition of bootstrapping
21:19so bootstrapping is taking the pain of
21:22fundraising and stretching it out across
21:25the entire life of your company why
21:27would you want to do that I propose to
21:29you that you should rip off the Band-Aid
21:31and take the pain up front
21:34and raise money for your company and
21:36then you never have to raise money again
21:38if you don't want to you can be like the
21:40zap your Founders and besides at the end
21:42of the day who's more in control of
21:44their startup in the end is it the
21:46bootstrapped founder who's always
21:48worried about running out of money or
21:50the founders that raise enough money to
21:52get the company going after they've
21:53built a product and gotten some users
21:55and they can just make their customers
21:57happy and they never have to raise again
21:58the next myth I want to talk about is
22:00this idea that I need a fancy Network to
22:02raise money the reality is that if you
22:04are making something people want
22:06investors don't care about where you
22:08went to school where you worked who
22:10you're friends with how old you are even
22:12investors are human and sure they notice
22:14pedigree but guess what folks investors
22:17are coin operated lizard people and they
22:21care a lot more about making money you
22:24can build your company like Podium
22:25Podium is a company that started off
22:28making customer review management
22:30software for tire shops all right if
22:33you're a tire shop and you're worried
22:35about what people are saying about you
22:36on Yelp you might use Podium to keep
22:38track of that the co-founders were two
22:40guys from Utah they had no Silicon
22:42Valley Network however they were really
22:44good at sales and they came into YC they
22:47were already making money and by the end
22:49of the batch they were making tens of
22:51thousands of dollars a month I actually
22:52randomly bumped into them at an alumni
22:55event during their batch and I was
22:57stunned that there was a company selling
22:58software to tire shops in y combinator
23:01and even more stunned when I found out
23:02how much money they were making
23:03investors noticed that too that they'd
23:05made something people want and they were
23:07able to raise and now today that company
23:09makes a hundred million dollars a year
23:11and has raised more than 200 million
23:13dollars these folks had no network these
23:15are not fancy Founders they just made
23:17something people want slight tangent
23:18while we're on this topic
23:20you'll probably run into people if
23:22you're thinking about fundraising who
23:24are going to offer to raise money for
23:26I have the network I know investors let
23:29me go in there and Pitch your company it
23:30is not a good idea it's always best for
23:33the founders to talk to investors
23:34themselves it's an important
23:36relationship and you want to own it so
23:37if someone makes you that offer you
23:39should get them to make an introduction
23:40instead and then you can go take the
23:42meeting all right the last myth I'm
23:44going to talk about today is the myth
23:46that if investors reject my startup that
23:48means it's a bad startup the reality is
23:50that no matter how great your product is
23:52how much traction you have investors are
23:55going to reject you and that's okay in
23:58fact it puts you in great company right
24:00here's a great example Envision so
24:02Envision is a medical device startup for
24:04cancer detection and it was started by
24:07serbisarna who's a YC group partner
24:09today when Serbia started building
24:10Envision she had a devil of a Time
24:13raising her first check she was rejected
24:16more than 50 times by investors to just
24:18get the first money for the company and
24:20the way that she was able to convince
24:22someone to write that first check and to
24:24help her get this company started was
24:26she she told them she was going to bet
24:27on herself and take no salary for the
24:30first two years if the investor was
24:32willing to bet on them and that was for
24:34a 25 000 check her first round of
24:37funding for the company was only five
24:38hundred thousand dollars but she got it
24:40done and she got even though she got
24:41rejected over and over again and since
24:43then the company was acquired for 275
24:46million dollars so here's this awesome
24:48medical device company that sold for
24:51hundreds of millions of dollars and yet
24:53rejection after rejection after
24:55rejection if you want to read more about
24:57serbi's story she actually has an
24:58awesome book coming out in the spring
25:00and it's on Amazon right now and we'll
25:02share the link with you in the chat if
25:04you want to check it out and pre-order
25:05it Serbia is awesome it's a privilege to
25:07get to work with her and the book is
25:09terrific one other example of this is
25:12what not it's a Marketplace for
25:14Collectibles they were in the winter 20
25:16batch and they came in with a beta
25:18product but no users they hadn't
25:19launched yet and during the batch they
25:21got started and it was just initially a
25:24Marketplace for selling funko pop toys
25:26toys with the big heads during the batch
25:28they got some early traction they
25:31started making some money they got in
25:32some buyers they got in some sellers
25:34Revenue was going up sales were going up
25:36things were looking good right but
25:38investors hated it and they only raised
25:42a fraction of the amount of money that
25:44they were hoping to raise for their seed
25:46round and the amazing thing is is that
25:48today what not just two and a half years
25:50later is worth 3.7 billion dollars and
25:54they've raised over 400 million dollars
25:56and just two and a half years ago they
25:58couldn't pay people to invest in their
26:00company at a fraction of that valuation
26:02everyone gets rejected it's just part of
26:04it even if you're building a four
26:06billion dollar company people are
26:08getting rejected and the thing is the
26:10founders were not really that bummed out
26:11about it because they had already done
26:13that work of convincing themselves that
26:15what they were building was working and
26:17was going to work investors just weren't
26:19seeing it yet some did enough did but
26:22they still faced a ton of rejection you
26:24don't need every investor to like what
26:25you're building you just need a few of
26:28them to believe and the good news is
26:30that today there's more investors than
26:32ever with more money than ever looking
26:34to invest in startups all right let's
26:36step back for a second and wrap this up
26:38there's a common theme to these myths
26:40that we talked about the idea that
26:42organizes all of these is the big myth
26:46this isn't for you these ideas that are
26:49out there these misconceptions the
26:50founders have they add up to people
26:52thinking gosh maybe this isn't for me
26:54maybe I shouldn't start my startup
26:56because I don't know how to do this
26:58stuff I don't have a fancy Network I I
27:00don't know all these people I don't know
27:01how to pitch I don't know how to impress
27:03people but the reality is you can do
27:05this fundraising is just a bunch of
27:07coffee chats and zoom calls you
27:10you don't need to raise money to get
27:12started you can just start working on
27:13your startup you don't need permission
27:14from investors you don't need an
27:16intricate pitch you just need to make
27:18something people want and be able to
27:20talk about it like a normal human you do
27:22that every day with your friends and
27:23family using safes it's easier than ever
27:25for you to go raise the money that you
27:27need without lawyers and quickly and the
27:29terms you're going to get today mean
27:31that you can run your company exactly
27:33how you want there's not some secret
27:35special way that you have to run your
27:36startup you can call the shots you don't
27:39need a big Network and fancy connections
27:40to raise money and finally the rejection
27:43that you're going to experience doesn't
27:45mean anything it's just part of the
27:47process it turns out there's never been
27:49a better time in the history of the
27:51world to raise money than now so if
27:53you're thinking of doing a startup
27:55get building you can do this you can do
27:58all of this you can do this
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