Raising in winters - Uterus is a feature, not a bug :)
Fund raising experiences that I wish most founders told you, but don’t
We recently hit the target raise for Supermind and I thought I would take a moment to reflect what I learnt in that ~4+ weeks. Formal announcement and the list of backers is here - what an amazing set of partners !!
The post below has my reflections on our journey(so far) and a few behind the scenes moments with people a part of my closed N/W. I allow myself to be seen, as I truly am and I allow serendipity of who I am to find its way via people I want to partner with. It doesn’t work for everyone - and it doesn’t have to. One of my strong value systems is that work is an expression of our consciousness - which is I am fearless & unapologetic. And yes, Uterus is a feature, not a bug :)
“Behind all your stories is always your mother's story. Because hers is where yours begin.”
―Mitch Albom, For One More Day
I am known to wear my spine on my sleeve, so I thought I would write what I would have loved reading myself about raising my first “real” round as an 1x entrepreneur, backwards. Writing helps synthesize what we think we know and this post is one of that.
The Devil wears Prada
But first, you need a “real” advisor. Someone like the Devil wears Prada, who much like Miranda shows the ropes to Andy. Your raise, any raise should not begin without it. For me, this was Godsend. A seasoned founder, who I had taken an exploratory call for professionally working with them, many moons ago.
Let’s call him C.
I stayed in touch with C during some of my very hard days at Shunya, esp towards realizing that it was a non-viable business. After closing Shunya, he helped me discover and reflect - he gave me poise and confidence, made a few Investor connects to discover my next leg, and not some made up feel-good cool-aid, but a framework of reflecting. Across the year, I kept running often difficult situations by him(such as this) and he invested his time in building me.
Most importantly, he allowed me to make my own mistakes, infuse my own personality into who and how I wanted to partner with our first set of stakeholders.
In my hardest days (The cold start problem of “Who else is on the party" ?”) - he kept me moving, with his friendly humour.
C showed me his own planning while fundraising for his own startup, running it like a 4 week process. Thanks, C - I am so much better because of you. But it is also true that because of him, I felt so much more accountable to leverage my entire energy to drive the closures, keep listening inro feedback, improve the weakest links and even GTM thinking & actual plan beyond the deck.
Fun fact : C has never seen me pitch :)
..but first, the story behind the story of Supermind
You never quite get up one day and think - let’s build a company tomorrow. It has to build on you, rub on you. And during this process, you have to embed yourself so deeply, as if you have always been an insider in the space. That is when, you have truly mastered the art of “Starting up”.
Then in Sept 2021, I started reading about Web3 and I started sending C my rudimentary set of thoughts on Web3. His side, he kept connecting with interesting people. The key moment was when Aditya, Sachin and I started to explore the space, almost up till 5 am every morning. Aditya was in UK timezone, so that helped :)
At this point I was churning 1/2 ideas every day and Sachin encouraged me to set up the Notion space. Unfortunately, as much as Sachin loved interacting with me, he did not want to build in web3(yet) - but stayed on as a good friend, and we kept meeting for lunches/dinner occasionally.
Early Jan 2022 I had already gone public about my co-founder dating on Linkedin ( Fun fact : I ran co-founder conversations also as a “process” and screened ~71 people, about 50% of which I may have spoken to, often ~2 calls). Looking back, all these experiences gave me a very strong perspective that a co-founder, or partner is not a name on deck, or hands - but if you literally fall through, put the feet on peddle in spite of not knowing it. In that, this person doesn’t have to be told.
I kept building and our notion space evolved over a period of time, from a few PRD’s to a real living company. During this time, I kept comparing every other person to Sachin’s maturity and here’s the proof :)
All founder journeys are lonely, but things change and the more you surround yourself with people that allow you to express your true self.
I am blessed to have many people like that in my professional circle. In those moments of doubt, to allow yourself to feel what you are feeling.
Same people, huh ? Same outcomes
I wish someone told this to entrepreneurs. A lot of Indian founders will sheepishly admit to having had angels that signed off the deal on Whatsapp. While that’s not bad, since this means fewer conversations, easy capital, faster closing - but here’s the catch.
That capital is not working for you. For us, we went through the HARD route, deliberately. We literally hunted the cap tables (via traxcn) and reconstructed the social graph. We knew the people we wanted (Ofcourse, that’s our wedge and I am not going to tell you that here!) and then we worked backward just for those people. Hell it was so much more work.
It is an understatement to say, that it was often very slow - but we got that. And when we cracked a few super angels in that segment and people could see why we really wanted those strategic connects - all they had to do was to take that meeting and do some ref checks.
A startup makes/breaks with distribution, esp enterprise startups. And I knew right from the beginning that every single person in the journey of Supermind has to be strategic, which is why the patience.
To get other others don’t get. Do what others won’t do.
Process, Process, Process !!
But when you are doing so much hard work on each conversation, how do you manage your time ? Simple - run it also like a process, adapt & improve. Here’s how our data rooms looked like.
We also made the process of opt-in, pre-read, and references super efficient, so as to enable people(in most cases) to consume most of the content offline and then the call could be best used for narrative/ any follow up questions. The beauty for our business is that our investors are also our prospective customers, so even if they may not invest in us for business reason, we still made the most of every conversation.
People dynamics - It will sometimes punch you in the gut
They say that when you ask people for money, it tells how much they really believe/support you :)
Let’s just say, you spent a lifetime working your ass off for someone and they do not show up when you ask. Not just “not show up” - but they go passive as if you never asked. They do not politely decline, they do not ask you if there are other ways, they can help you with(Like, with their networks - which is a MASSIVE leverage). As opposed to venture capital which has many axis to think of(Eg: not being able to back a better Entrepreneur if they back you), these individuals deploy their own money and it’s less about the quantum of the deployment than the support they show, and to round up/ get traction at the start of your raise.
What I learnt was to not focus my energy on these conversations, as much as they punch you, and trust that often they will. Keep moving forward.
Momentum beats momentum.
And, then advice, and all kinds of it
Also, a lot of well-meaning people will give you a lot of advice, some of which may be out of context for your personality. That your slides are complicated, your narrative is too enterprisey (and needs to be leaner), your communication is overly persuasive for warm connects et al - take the best of this, reflect, adapt and be Gabru :) You do not need money from every-one in the universe, just a handful that can see beyond the cosmetics of the pitch, but how you arrived there and how deep your thinking and execution space is.
But there’s a silver lining
..As a function of this, you will know who has your back.
Like literally, can you trust them with your life. Personally, for me, this was Sachin Shenoy ,who literally gave me the breathing space, so I could hire and offered to match or exceed my own bootstrapped investment.
So, as someone who believes in Gita - I believe that for profound good to exist in this world, some turmoil is needed.
Like, an angel investor that I had met a Chennai expo while building my 1st startup, or another who, with whom we had raised funds, but never quite infused.
Another of my previous angels once remarked “.. that I trust you that you will be the last standing man”, before bringing down the house of cards.
Be self aware & know your edge
Our edge was that we had sufficient room to keep growing because as we are building very very frugally with the very missionary team. Infact our total monthly spends were well under $6500. How can you beat a cockroach that is frugal ?
This was the edge that enabled me to have a conversation that infact, we did not need so much money to build, or get to GTM.
This was a key realization at Week 3 of our capital raise cycle and it changed the dynamics of the conversations. This also meant that we politely refused to engage with funds in a VC style check size, while giving them an opt-in to get toe-hold positions if it made business sense for them.
It starts with actually questioning, how much do you really need ? And, do you need for others, or for your self, or for media. A lot of well meaning folks told me that we are competing in a global market, talent is expensive, all of which is true - but to truly get off ground, you actually don’t need a lot.
1/ If you are confident, you know something that they don’t.
2/ Like Investors can invest in Fear/Greed - Founders can also raise with Fear/Greed - know yourself and establish coherence with your belief systems.
Second time founders are more matured - it’s like getting married post divorce :)
During the last year, I spent a lot of time, pro bono volunteering for whetting pitches & product roadmaps of other entrepreneurs. As a function of this, you build a strong N/W and a right to time, to help you find seasoned folks who can plug your thinking.
Over the course of Supermind, I could fully deploy this social capital, as there was no way I would have accelerated this on my own.
One amongst them was also an angel, that I had connected to last year when I was whetting a few Web3 deals together/exchanging notes. This time spent was strategic since I had exited my 1st startup in April 2021 (B2B Edtech which was a commercial non-success) and I spent the time between then and now, doubling down on user needs, distribution & N/W on what next to build in Web3.
Your social capital arrives before you do
I've seen your work..Many of the reports are vanilla analytics, like I've seen like 10 projects like this hands down. Your’s was by far the most well researched, most understood of how we were building everyone was like lets make 2 charts here and there... and nobody had done customer conversations…so, you are by far, like, like 10 steps ahead of every founder. Not kidding. Not kidding. Not kidding. (Actually, three times :) )
As a function of how well we knew what we were doing, we got a lot of inbound, not just users, and waitlists, but also OG’s that wanted to be a part of the building the product and giving us feedback actively. Tell me about social capital :)
Joel covered us here and that helped too, since we hadn’t even prioritized the website, so far.
Keep your trump cards to yourself
Progressive release of information :) Well, this needs to be cryptic.
The deep market intel that we had done gave us a massive edge on how you would build a platform play in 2022 vs the monolithic thinking on 1980’s - which was right for its own time.
In particular, I saw the journey of Bloomberg from multiple lens, read almost everything I could find about it. Spoke to building people building it and got deep intel sourced in the space. This was my Trojan horse.
Getting the first cheque
Looking back, one of the friction that understandably a lot of investors have is single founder team(and that too lead by a woman, though I doubt most VC’s will tell you that).
When it came to “so, who else is in your team”, I felt that I was playing defense as that was the weakest narrative on my ability to build the institution I wanted to build -and hell I knew I could do at 200% better than anyone else. I knew what I was doing, I knew my cards and I knew the people I wanted to work with - my strength is my clarity & my focus.
Early stage investing is skill based investing and the only thing I will add is that the opportunity cost for me is too high to build a non viable business second time around, in that not only have I done my homework, but also Supermind has 200% of me. We are insanely user centric, are frugal at aligning our energies, have extremely high bar of professional integrity and awareness and plugged in to ecosystem to learn from the journeys of others than from our own set of mistakes.
Sometimes, you have to nudge and show why you are the person for the job - and I connected better with people, who eventually bet on me - with this clarity & confidence as opposed to letting them arrive at their own conclusion.
And a mix of other realizations
Finally, never screw your early believers
One of the micro VC’s requested if we could change the pre-money valuation to post money. This meant clearer constructs on ownership at next round, while also protecting them from any future SAFE’s I may raise before the next priced round. And it was an effortless decision that I then took for all early investors, not just the one that asked.
Focus, build relationships, goodwill, everything else will follow. It’s only getting started.
Closing note
Follow and march to your own beat
में शून्य पे सवार हूँ
बेअदब सा में खुमार हूँ
अब मुश्किलों के क्या डरूं
में खुद केहर हजार हूँ
में शून्य पे सवार हूँ।ना सूर्य मेरे साथ है
तो क्या नई ये बात है
वो शाम को था ढल गया
वो रात से था डर गयामें जुगनूंओ का यार हूँ
में शून्य पे सवार हूँ।- ज़ाकिर खान