Episode 1: In the early-stage of a startup.
Venture Capital ▮ To talk or not to talk, that's the question!
Feb 9, 2019 Chris Kobyłecki, Innovation Nest
Guest of Episode
Chris Kobyłecki, Innovation Nest
Chris is taking care of Innovation Nest’s deal flow activities and making sure that people know about Innovation Nest. He runs an invite only event called SaaS Meetup which gathers together B2B SaaS Companies, Founders, Mentors and Investors. Previously he was taking care of marketing for a Board of European Students of Technology, addressing 32 countries and over 90 universities. Life is a challenge.
Transcription
Oh right, oh right, oh right!
Guys! This is the bridge-connection between Chris and Chris. Gliwice-Krakow. I invited you today, because I briefly wanted to discuss the situation that has an early-stage founder. And even before that. A person that has an idea and is thinking out of the possible options that he has for developing his company and I know that your company... A quick background: Chris works for the Innovation Nest - one of the coolest VC company out there with HQ in Krakow, Poland - so totally recommend talking to these guys.
But from a perspective of an early, early-stage entrepreneur... basically, maybe that will be our first question, what do you think, when it is the best moment for such person even to consider talking to a VC or Angel or Business Angel? What should be the first step when thinking of some capital that probably be needed to start this company? Because I assume that some companies can just be started with the existing funds, but not everyone has them. Then we need to go and look for people that do have.
Very generic question, but very curious, what you think on this?
Alright! Hi, everyone who's listening to the podcast! I guess this is the very first episode. My name is Chris Kobyłecki, I'm personally from Gliwice, but I live in Krakow, where our offices are. As mentioned by the other Chris, we’re called Innovation Nest. We are a venture capital firm based here in Krakow, Poland. We focus on early stage B2B software companies in Europe. This is what we do in a short brief.
Going back to the first question that you had. Basically, the question is, “When should you talk to investors or when should you start considering taking external money?” And I think there are two sides through to this question. First, let's start from the second side. I think my honest answer to the question, like when should you get money is: “Don't do it, don't get money, don't look for an investment!”. If you're able to bootstrap your company, bootstrap meaning that you are self-sustainable, you have enough money or saving at the very beginning to jump-start your company and you see growth and everything. Building a sustainable organization where you don't need external capital, don’t do it! Do not go and find capital from other external sources. If you want to get capital, I would highly recommend considering a credit line or something that is able to give you some cash that you need for your cash flow and making sure that you're able to be sustainable. Taking external money is a different topic, because it goes into a question: “Oh, so you're not building a company. You’re maybe building a startup” Steve Blanks’ definition is: (startup) is a temporary organization looking for a scalable and repeatable business model.
Yeah!
What does this mean is that you're looking for scalable and repeatable business model. You're looking for something that is not going to be a normal company but it's going to be a high-growth company, usually. This is something that is overseen by a lot of people that: “Oh, I'm building a startup and I just need to get some money and things will happen, right?” No, if you're looking for money and you want to get investment from someone, then the expectation from the other size is that you're building a business that is going to be a high-growth business and everything in this organization will change into the growth. Of course, there are different types of the businesses and there are different stages of the businesses and there are different stages of funding and this is what I guess we'll cover during this podcast. At the very beginning and I don't know, ideation stage or when you're trying to build your MVP, which stands for a minimum viable product, I would not try to look for money because there's a lot of problems in that stage and because you don't really have a product. You don't really have a defined customer. You don't really have a defined solution. You don't know what kind of a market you are operating on. Everything is a hypothesis. This is a huge hypothesis stage that you're in. Everything, what you're doing is a big question mark and you're trying to answer those question works with some kind of a validation of your hypotheses. I would spend as much time and I would invest my own time in order to answer those questions that I have. Figuring out what kind of customers do I want to have. What kind of a customer am I building for? What am I building? What's going to be my product? First of all, what's going to be my value proposition for the customer segment? If you're at this stage I highly recommend one book which is called “Business Model Generation” by Alex Osterwalder. It basically sums up your business into nine building blocks. The two building blocks that I mentioned: customer segment and value proposition are the first, and the founding building blocks of your business and there's even a second book by the same author, which is called “Building Value Proposition” or “Value Proposition Design”.
Yeah!
This goes into detail on figuring out your customer segment and your value proposition for that. Your customer is usually a persona or someone that is going to be on a receiving end of your value. That person has either pain that he would like to solve or that person has a need. Those are two different aspects, right? You're either building a pain reliever or something that actually solves a big problem for someone. Or you're building a vitamin that basically generates some good for someone and it's not necessary, it's not critical for that person to run their business. Those are two different types of products. The value proposition for those two different segments has to be different, when it comes to this.
When you will figure out your customer segment and your value precision then you can move on to building an MVP - this minimal viable product. That not necessarily has to be some kind of a solution that has how many millions of lines of code and everything. Maybe there's a way to hack it or prove that you can deliver this value to this customer and charge that customer for something without building a product at this stage. If you will get, I don't know, just two customers or something that will start using your service, order or a product and then you will figure out, “Okay it's actually were spending some more time to build something that I would invest more time into finding someone that would be your co-founder that will be able to join this lonely journey of building a better future and trying to convince them first to invest their time too in that service. I would find a second person or a third person that is willing to dedicate their time. When you will reach that stage that means that you have a product and you have clearly defined a customer segment and this value proposition, and you have some kind of a solution.
Now, I’d start looking for a way to: “Okay, how can we validate this? How can validate this actually goes on some kind of a market and so on. When you would validate that, it means that you start generating some more money, you have three thousand monthly recurring revenue or something like that. It really depends on your pricing strategy and so on. If you're building a huge enterprise product and it will take years to close that first customer, and that is I really tough spot to be in, but typical SaaS solution will start with a single app and when you will build on top onto, and then you will start charging more and more, and then a problem of scale will basically be postponed to in some time. When you will have generated some of early traction, then you will see that. “Okay, I have this kind of a market that I am actually on and I have those customers that are willing to pay for my service”.
And then the question is like, “Oh, do I want to jump-start this ship into a rocket ship and do I really want to speed up then”, maybe then, there is this point of like: “Okay, if I could take some external money from some entity and basically this capital will allow me to, I don't know, growth faster” then maybe that's the point when you can start looking for an external investment. And then there are multiple entities that are available for you to actually ask this capital for.
We're leaving in Poland and we're living in a European Union. There's plenty of places that you can find capital here. I think one of the basic building blocks of building investible companies and so on, are the Angel Investors. Those are typically the people that have to fit. One: they have capital and they're willing to invest in this early stage company. Two: they have knowledge. They went through a building process of the company and they will be able to help you to solve those question marks. Getting Angel Investors at the very beginning, this is the best way to do it. Getting Angel Investor that can provide you not only the capital, but also with knowledge and this ability for solving questions that you have, every single day - this is something that is highly valuable when you're an early stage startup.
Then, of course, you have different things. You have Venture Capital - let's talk about that in a moment - but you have loads of different types of grants
Yep.
Building technology in Europe and we're living in this place where the amount of money available for R&D projects is a huge! And they have loads of constraints. I would be really careful when selecting something, because it really puts you on a lot of constraints to use a big amounts of capital, which you're not used to manage in an early stage company and it sounds really tempting and sometimes it’s worth but the majority of the times I would highly consider not doing some sort of R&D grants, because they will not allow you to focus on building the product or something like that, because when it comes to the early stage software company, there's a lot of things that change. You will have to pivot a lot of times and you will have to change that early customer segment or that value proposition.
You are looking for this scalable model, right?
Exactly! That’s a temporary organization. We are constantly looking and changing, right? Maybe we should not sell to enterprises, maybe we should sell to the small, medium businesses? Maybe we should offer them something different and so on. There's a lot of change.
And then going back to a place where you can get a capital from. Yes, there is the Venture Capital! Venture Capital are the institutional investors willing to invest money in the company and they're also different types of venture capital. There's corporate Venture Capital, there’s normal Venture Capital. All of them, every single fund has a different geography. Every single fund has a different portfolio that they invested in. They have all different types of knowledge that they can represent this an organization. That sort of knowledge is also what you're getting with an investment.
If you would consider raising money from a VC, then yeah, you're going to get money. Sometimes you're going to get value. That value can be knowledge, that value can be network. That value can be all sorts of different things that the investor can provide. Maybe it's customers. Maybe help with the recruitment and searching for talent, maybe something else. That really depends on the Venture Capital. In the end the moment that you're starting to think about the investment, it's the moment that you're starting to play with that shares that you have. Your ownership of the company. Getting capital usually costs. It costs your ownership, so you're going to lose your percent inside of your company. Second of all, you're going to lose government, so you're going to lose the power of actually building an organization from scratch in a way that you want. With an investment comes expectation of growth and they is going to be a cost. The question: “Okay, but how are you going to grow X percent per month?” or “How are we going to triple the revenue within a year or quadruple, and we are doing eight times growth?” and so on. Then you have some sort of questions that will be asked. You will lose are not only the ownership but also the governs. This is the short introduction to the a very first question of “when to think of raising the capital?”.
I was also considering a situation when someone has an idea. He’s actually putting a plan. What would be the next step for say a quarter, or half or year, or year in advance? There would be, I guess, three activities: One activity is - building a product. Second activity is - talking to customers. These two are strongly related. I think there is an important amount of time that you at least need to plan ahead to start dating with Angels or Investors or even researching these grants.
The founders somehow try to allocate the time. When they should, maybe, not close the deal with VC or Angel, but at least start considering. There can be certain types of application deadlines or some investors might be busy in summer, but not us in winter etc. It also depends. I believe some of them, if they can, can advise, even early on without investing to give and help to establish certain milestones for the founder. Their answer will typically, as I understand, will be: “No, I'm not going to invest in this moment. Here is a hint, here is a homework we can give you. If you come back with some results that we can think of next milestone”.
It's more about planning of time, if that makes sense, than actually doing the finalization and close of the deal. I'm kind of trying to connect those three elements. When it is not too early, and when it is to late actually to consider talking. That for sure, closing a deal with VC, I assume, can take a few months. With all the lawyers and that. There is some legal element for sure, involved in there, right?
I think the question here would be: “What is the typical investment process, from a side of a VC and how can you plug into? How can you plan for bringing an investment process of a Venture Capital firm?”
First of all, it takes time, right? As we mentioned, you as a founder have limited things that you have. One of the key assets, that you have, is your time. You're going invest your time in a lot of things. Investing time super early to getting investors might be a be risky, because you're spending your time on a wrong thing. You're having a problem with allocating your time. You’re going to allocate that towards the investment, you're not ready.
What I would do if I was a founder right now? First, try to play with the idea of getting to know investors. Not trying to look for a capital, but building a relationship, because, in the end, getting an investment is kind of building a relationship. A lot of people are saying it’s like getting married. The amount of paperwork is way higher, way bigger than a typical marriage. Getting to know takes some time. There's a lot of things that happen while you're doing this. A typical VC process? Let's change sides and try to understand how it looks from an investor's point of view.
Typical process comes in stages. When you look at the venture capital and the value chain of a venture capital, there's a fundraising at the very beginning. that means getting the funds in order to start building a fund. Then the second thing is deal flow. That means looking for deals and trying to basically get into the best deals possible. Then, third thing would be investment process. This is exactly how are you processing the things that you found in deal flow? Then fourth would be portfolio management, after your investing in companies. How are you managing those companies? The fifth would be exit. How are you selling those companies and how are you getting out of them?
Typically, what are we're going to talk about here, is the deal flow process and the investment process. Deal flow process is basically how as a VC firm, you're finding those deals and how are you sourcing companies to you. As an investor, there are typically two ways of doing that. There’s an inbound way and outbound way. Going back to what we said, venture capital and investing is a really relationship-kind of industry. It heavily relies on a network. Inbound leads that are coming through, towards VC are the best sort of leads. Inbound means that, there's some sort of a context already built. There's someone around typically it's a network. A founder of a portfolio company introduces another company. An investor that you have a co-investment with, introduces a company. Someone that you know, introduces someone. There is a sort of an event that you're getting to know someone. There's a context, that you're in, and you're getting to know some sort of a company. When you have sort of a context or someone is vouching for you - that's the best kind of validation which you’re getting really early.
The second type would be outbound. Outbound is, we're living in the age right now, where all investors are also building their sort of outbound sales, and so on. Trying to get into those deals. The amount of companies that are there in the Europe, it's crazy. Amount of software companies in the world, it's even crazier, right? There is all sort of ways trying to figure out what sort of companies are there. Different acceleration program, databases, newsletters. There are different sources of information that basically can provide you with some company. You can read about a lot of companies up in advance. Trying to reach out to those companies and get to know them. Trying to figure out what sort of a product and market and so on, this company is operating on. Basically, trying to understand the things that we defined at the very beginning. The customer segment, the value proposition, the market that someone is operating on and... And so on.
When you're getting to the stage of “Let's have a conversation with this company”, and this is something that you like, this is where I think, what I would call a business due diligence starts. This is going to be the first step in the investment process. It's business due diligence, right? There are all sorts of different types of information that you were looking for. You're trying to basically minimize the risks. Venture Capital, venture means risk. You have risky capital in the end. This business is about minimizing risks and trying to basically answer all sort of different questions, all sort of different things that can go wrong with the company. Trying to assess if the people who are behind it, the market that they operate and the product they've built, the traction that they have, and the transaction that is happening is not risky. You're trying to figure out this.
All sort of different funds have different ideas of how to process this. There's different sort of sets of questions that can be asked. In general, they're the big buckets. First of all, as some people say, in the end it all depends on people. Those are the people who are building the particular companies, so there's an aspect of the team and the organization that is behind a given company. What's the background of the founders? Why are those the people who will build the outstanding product in the future? How come those people will be the number ones in this category, that they're building? There's all sort of different questions really.
Second of all, it’s going to be the question of the product. Inside of a product, you have a lot of things, right? We have the customer that is there. You have the solution that is there. You have the value proposition that is offered to that particular customer segment. There's the solution that we talked about. There's the product, the usage of the product. How sticky it is? What sort of the product it is? Why is this particular product, the best in its category, that has the possibility of being the best in the category?
Then you have all sort of questions related to market.
Right now, there's not a single company that is so different for all of the over, it's the only one out there in the world. Typically, when someone has an idea, there's already these two or three people out there in the world building something similar. There's a sort of a market that someone operates on. There's a competition on the market, that we just covered. There's also the size of market, right? What's the total addressable market that you are on? What's the obtainable market that you can actually get from that market, right? Within a year, what's the percentage of the market that you all already managed to capture, right? And all sort of the questions, like is this market big enough in the future?
How VCs are making money? They're investing early and they're helping to grow the company. They're exiting the company. Within a 10 years period, or something like that, they're trying to make money on selling the company that they manage to help to grow within the time. Then try to sell to those assets and make money. The question is within those 10 years or a time period, how will this company evolve? What size of the market will this operate? Will this market grow? Will it stay the same? Will it decrease? There's all sort of questions connected to that.
Then they have the questions about traction. How this company was building the product and how were they operating within the last 12 months, within six months or some period of time? That actually can prove that they know what they're doing. They know to whom are they selling, what are they selling, what are the channels? How are they making money? And so on, and so on…
Going back to the building blocks of the business model, trying to understand: “What was their performance over the last period of time, where the growth was happening? So, we can throw money, and we know that this machine basically needs money, so they can generate more volume, more money in the end.”
Then you have questions about the transaction itself. “How much money do they need? Why did I need that money? Do they have that money for 12 months? 18 months? 24 months? What's going to happen after that? How much are we going pay for it? What will be the valuation of the company?” And so on.
How VCs are making money? They're investing early and they're helping to grow the company. They're exiting the company. Within a 10 years period, or something like that, they're trying to make money on selling the company that they manage to help to grow within the time. Then try to sell to those assets and make money. The question is within those 10 years or a time period, how will this company evolve? What size of the market will this operate? Will this market grow? Will it stay the same? Will it decrease? There's all sort of questions connected to that.
Then they have the questions about traction. How this company was building the product and how were they operating within the last 12 months, within six months or some period of time? That actually can prove that they know what they're doing. They know to whom are they selling, what are they selling, what are the channels? How are they making money? And so on, and so on…
Going back to the building blocks of the business model, trying to understand: “What was their performance over the last period of time, where the growth was happening? So, we can throw money, and we know that this machine basically needs money, so they can generate more volume, more money in the end.”
Then you have questions about the transaction itself. “How much money do they need? Why did I need that money? Do they have that money for 12 months? 18 months? 24 months? What's going to happen after that? How much are we going pay for it? What will be the valuation of the company?” And so on.
Then you're working on agreement. You're signing the agreement. There's typically the process of getting money: The VCs have to draw down money from their investors - that takes around a week or something. After signing the agreement, the funds are sent to the company, and this is basically the end of the investment. Then the whole process of being inside of a portfolio of a VC firm, the work starts. How long does it take? When it comes to the business due diligence, it can take as a little as two weeks. If there's a really hot deal out there, and the company knows everything, and can answer questions immediately. Then it will be really short process.
Is it like you’re sending these questions with a form, a Google document the company answers you?
It really depends. So yes, at some point there will be a form or something like that.
I was thinking that maybe it makes sense to go to s***y VC, bring all these questions. Then they will say: “Okay yes, you are hot, we want to invest.” And you will say “No”. Then when you come to the real VC, that you want to talk with - then you can give: “By the way, we’ve answered all the questions from the previous company, so we have this extra month.”
Yeah! Typically, what I would suggest for a company is to build a data room. You have a place, a Dropbox folder, or something that has some sort of information. I like to think of it as a knowledge center. You have your own internal organization knowledge center, that you're able to present to others. You are able to get an investor and show him what exactly is happening in my business and I know what I am doing. When you're talking to investors - I would strongly suggest to make a list upfront. Check out the VCs that you really want. Put them in some tiers. There's a tier one that I really want and great to have them. I would have tier two, that I can go with, but not necessarily. This is not my first choice. And there’s tier three - those are the guys, if I would have money from them - alright, let's just take money from them.
I would start my conversation with tier three, if I would be fundraising, but this is not the case that we're talking about right now. We're talking about the case where I'm getting no investor. Typically, it's best to figure out what sort of an events and investor is going to and trying to get a coffee with him. Getting someone to introduce me to someone. Going to investors office hours.
Do you typically give homework, after these office hours? If you think that they’re probably too early, but they seem smart. In terms of your pipeline, do you have sort of companies: “Right now, not ready. Not a deal for you. But in six months from now…”
I wouldn't call it a homework. I think of it's more of points the company should thing of, going through, understand in greater detail. Typically, there is going to be a question - when it comes to grow, there's some sort of funnel that you have it in your company. The question would be like, “How are you generating the top of the funnel? How are things moving along the funnel? What are the conversions? How are you generating that growth?” There's all sort of different things. Different company on a different level will have different things to do, and different aspects.
In the end, yes. I think it's every single VC that you will talk with – I mean, a good VC - will give you something. Will give you feedback, in a sense. That will be a point to thing on. In the end you are the captain of your own ship. You are the owner of the company, the CEO, you're the founder. That means, people can give you feedback, they can advise, but in the end you're the one who's making decisions. If you go to 10 different VCs, there will be 10 different opinions. You should decide what should we focus on, because in the end organization is built by people. People have limited time that they all create towards building a business. The day in the end has 24 hours, so if we're going to spend within next six months on something, we should better iterate really fast, so we know at the beginning, “Okay, we're going in the right direction”, or you're going to lose time, and that does not make sense.
I really wanted to ask this question. From there, is sounds to me the time when you should apply for VCs is probably later on, and earlier on you should think of angels or, for instance, accelerators. How would you compare, what in early stage, when someone is with an idea, very early phase of his product, what's your opinion in general on applying to YC, which is very prestigious and it's also very hard to get there, versus applying to Innovation Nest? When it's good to apply to want to one of these? When it's good to apply to Innovation Nest? You’ve described perfectly from your point of view, that situation when that time is mature enough. Let's think more about the earlier possibilities.
I think they’re different. The thing that we didn’t discussed in a first question is that, there are acceleration programs. YC is an acceleration program that was created by Paul Graham, back in 2009, 2010 - something like that. It’s top tier accelerator out there in the world. When it comes to other accelerators, that would be of a similar level, I would say TechStars with their dedicated iteration program on some specific verticals. I would put 500 Startups in the same badge. There are basically three acceleration programs. First of all, I would answer myself a question, if I'm considering an acceleration program? What's the value that I'm going to get from this? I would think of a acceleration program, in those cases of the top tier thing, not only as guys that are going to work with, but some sort of a school or an MBA program that I need, in order to actually think of my company. What's going to happen with it?
Typically, those programs last up to three months. They require me to be in some location for those three months. I'm still going to build my business. Actually, those three funds, those three acceleration programs, that we covered, they have completely different models. YC organizes a lot of office hours. They have the founders’ dinners. They have one more thing per week. That's the only a requirement that you have. You're getting plugged into a really amazing network of other funders. They are able to help you solve your problems. You have to be able to name those problems. If I have a specific problem with turn or how to create a network effect for my company or how to generate the top of the funnel, they will be able to connect me to other founders that know. They will point you in some material. In YC a majority of the companies are sitting alone. Renting a house somewhere and working from there. Typically, there's two or three people that are in Bay Area for that time and they work from there.
When it comes to 500 Startups – a bit different story - more classes. All companies sit together in one office. There's this network value that is there. When it comes to TechStars, all sort of different programs happening from all around the world. Really specific. Also has a limited agenda but sometimes have more things on the agenda.
All of the funds are offering some sort of money on a convertible note. Typically, around 100k USD or something like that, depends on the location or when comes to TechStars and the 500. It's another convertible note or a safe note, so really easy investment. That money typically covers expenses for those two-three founders to live in a location for those three months of a program and being able to sustain themselves.
That gives you a lot if you're at this stage, you not necessarily know what you're doing. Your team is limited. You know that you want to work with a particular network or people, or you want to know something specific. I would, for sure, apply to a top-tier acceleration program, if I really want to do that, so I want to dedicate three-four months towards doing this. If you don't want to dedicate three months and you want to do something else, then there all other alternatives. When it comes to getting into the top-tier acceleration program, it really depends. YC, under they moved under Sam Altman, when Paul Graham decided to basically resign as a managing partner of YC and Sam started doing this, they changed their model of finding companies. They're going after crazy ideas right now and they want to build a better future.
If you're building a product that is going to be a revolutionary and has something to do with making our lives way better by fighting carbon pollution generated by meat production, or something like that. A wild idea that needs crazy people to work on, then that's the program that you want to go through. If you're building something that is more down to earth, that is a software B2B business, then I would go either to TechStars or 500 Startups for a specific batch, because they have specific batches for specific things.
TechStars is really good when it comes to verticals. If you have software for movie industry, they have a great program with Disney. They're limited to a three months school for something and the amount of money that you're receiving is a small amount that's will allow you to be sustainable for something and you plug it into a network. If you want more money, then going into acceleration program is a good way to doing that, because at the end of all of the acceleration programs, there's typically a Demo Day where a lot of investors are gathering. Those companies get a lot of exposure. Going back to, how VCs are getting their investment, it’s a great inbound way for a VC to know acceleration programs and get to know companies from there.
There are also other ways. If you compare Innovation Next to YC, they’re completely different things. We're comparing apples to not even pears, but ants or something completely different. Apples to plastic - two different words. It's an acceleration program, based in San Francisco that lasts three months, that invests a 100k and works for few for that. We're a European-based VC firm that invests on average a 700k, then has an ability to invest a way more in your company. We're not going work with you for three months, we're going work with you for two years. Now, we're going to give more money. Will help you find other investors. We're different offerings for those businesses. It's really hard to compare those. But if you're a founder, I would definitely try to apply to the one of those three top-tier acceleration programs, because it's a good way to getting ready to talk to VCs and validating what I'm doing, because the application program for those programs is actually really detailed. It makes you think about a lot of aspects. Filling in the YC application form or any acceleration program application form is actually answering a lot of questions that will be asked by VCs. Those will help you to get ready to talk with them.
Have you ever participated as a VC at one of these Demo Days? I mean, 500, TechStars or YC?
We have. Me personally not, someone from our team, yes. We go to TechStars quite often. We invested in a number, I think three or four companies out of 500 Startups. We invested in two companies out of YC. We invested in three-four more companies out of other acceleration programs.
So, as an early stage founder I should try acceleration program and then 90 days later or 120 days later, you'll be waiting for me. I will get more ready to discuss with VC. Of course, that’s the optimistic scenario.
That's a super optimistic… and no, it doesn't work like that. If you going to spend those 90 days, generating a huge traction that you have. Month-over-month growth of over 10%. You're building an organization that knows how to generate that growth. It's actually building something interesting on a really interesting market, then I guarantee a lot of VC will want to talk with you, whenever you approach them and whatever way you approach. If you have this kind of attraction on a really big market and the team that is building this is really interesting, everyone that you approach will want to talk to you.
Also one of the last questions, because we need to wrap up. But I guess that might be a chance for a follow-up round later on. This moment when you're working on idea requires a lot of a knowledge from you. That really much is related to the product and technical aspects of it. The customer - a lot of marketing and sales. Also, this whole ideation and actually thinking of what idea do we have. What is my product? For which market? You’ve described these acceleration programs as MBA schools or some sort of classes. Assuming that not everyone will get accepted by them, do you see any other than reading articles and books from Internet? Any other way, looking for mentors and other? And where actually? If someone is on the reach for a mentor for his startup. A person that can help him, more like a couch, more like an advisor. To help him get from a moment where he is right now, to a moment, where he wants to be with his company. Such people exist? If yes, where actually is the best way to look after them?
We're living in the age where the access to knowledge is so easy. It's crazy. If you're building B2B software business, then for pretty much all sort of the questions that you can have, there's an answer out there on the Internet with multiple case studies how to do that. This is crazy. It’s so easy to access knowledge, is ridiculous. You will have lots of content on it. You'll probably have a best-selling book on it. You will have a number of podcasts. You will have video presentations. You will have content from acceleration programs…
…our podcast...
… you will have this podcast. You will have Slideshare. You will have everything possible on the topic. The knowledge is out there. I think, as a founder, one of the most important things is your willingness to learn. That has to be huge. You have to improve every single day. You really have to learn every single day, you have to read crazy amounts of all books, articles, and basically gain knowledge. First thing to figure out would be, “How am I learning, how will I be able to learn?”. Second of all, access to people, is also crazy easy right now. In those times that we’re living. There's a number of companies that actually aggregates mentors or coaches, and so on. You can actually pay people, per minute or per hour to jump on Skype with them. To actually have a conversation with them. There's a number of sites that have people there. If you have a problem, you will find an article written by someone, you can definitely reach out to an author of that and try to ask him more questions. He will be more than happy to answer those or jump on a call, because in the end, jumping on the call for 20 minutes is not that hard.
It's just the way of persistence and follow-ups, and basically making sure that things happen. That is another thing - learning and making things happen, that's a second ability. I don't think it's a problem. If you want to find a specific mentor or something like that. You will have to spend some energy on finding a right person. If you find someone that is inspirational for you, that you really enjoy having conversations.
Especially because, there’s so much knowledge out there, I guess then the problem is not to gain knowledge, but actually take the right amount, in a right time. Someone that will help to focus actually on the right thing at the right time. You’ve mentioned that if you just have an idea and nothing else, that probably doesn't make sense to go after a VC, for a very good reason. I think that kind of person will exactly tell you this, “Even forget for now, it’s too early. The things you need to do this month, this week - the best ones would be find a first customer or draw a mock-up of your MVP and even think how it will look like.
If you're going through this really basic idea and what-to-do-next, I think there’s a number of events that are happening in each city, that will be able to answer those. Starting from all sort of Startup Weekends or Hackathons. There is a great amount of “I'm going take in by a hand and walk you through by what you're supposed to do within next 24, 72 or X amount of hours”. That's the great way to validate your thing.
It is also a great way to meet other people, that can answer you…
…hiring founders…
… when it comes to getting a mentor and so on, I think the greatest mentors are people who are one step ahead of you, because they just did what you're doing. If you're trying to find an investor, then it would be great to talk with people who’ve just closed their round. How do it happen? What do you needed to do, and so on?
If you have a problem on something, then go to an event that will talk about this problem. The amount of events all around there. It's just crazy, how many events are happening. On building software, on sales, on the marketing or on UX or whatever. You go there, you get to know people you talk to speakers. You're putting yourself out there and you're getting answers to the questions that you have, and people will point you in some directions. In the end, you have to be willing to learn and you have to be willing to spend some time trying to figure out the answer to your question.
You’ve made a very good point. It makes sense to find someone that is one stage ahead from you. Imagine you want to be in a position B, find a person that is already there and that may be a good mentor.
Don't think like, “I'm a guy who has an idea and there's a company that just raised 50M USD”. Don't talk with them. Talk with someone who has four people. I'm alone - talk to someone that has four people, is a small organization. He's one step ahead of you, not 50 steps.
That the start, hope that was very valuable for our listeners. It sounds like there are many options and it's about the wise choices, not about lack of the options. We are living in good times, good days. Thanks again for this quick chat. I think there some need for more, but the time is sharp as well, as you’ve mentioned. Thanks again! Let’s touch base soon and meet with the future podcast, hopefully and in real life. Gliwice, Krakow or San Francisco.
Thank you for the podcast and talk later.,
Appreciate it! Bye bye!