Amber Atherton of Zyper and Iba Masood of TARA on Raising a Series A as a Female Founder

All right, so today I have EBU Masood from Tara and Amber, assistant from Zai. How's it going?

Hello, good. So today we're gonna talk about fundraising, but before that, let's talk about your companies. So Eva, what do you do?

So, correct, it's great to be here. I'm If I'm Masood, I'm the co-founder and CEO of Thara. So, we're building an end-to-end solution for product management. So we help product managers, engineering managers, spec out their products, gain insight into their development lifecycle, and essentially monitor progress within software development.

Hello! So great to be here. Zai helps brands connect to their superfans to build community. So we work with a lot of big Fortune 500 companies like Kellogg's or Nike to help them really identify who that top 1% of fans are, and then bring them into a space to co-create product or to become brand ambassadors.

Okay, and so both of you this year raised your Series A, but I think it would be interesting to start from the beginning. So could you tell me your story? Did either of you raise pre-YC?

Yes, I did.

Okay, so yeah, this would be good. So one in one. Okay, so how did you do it?

Okay, so in 2017, I was in London; I started my company in 2017, and I raised 1.2 million seed in London from a VC in London and a lot of angels involved in that round—great angels involved in that round. And then I applied to YC and got in.

Okay, and they needed more seed?

Yeah.

And you just applied?

I see, but you applied a couple of times, right?

Yeah, I did. So I applied twice, and it was with the—I think at the time it was a different idea, a different company, different even market segments. We were focusing on the Middle East, okay, so it was basically like a careers platform for fresh grads and so entirely different company.

Okay, and what did you get in with?

We got in with a careers platform for grads in the U.S., so that was like the first— that was in 2015—when we first got in.

I see. And post-YC for that, we raised roughly around 200k or so.

So it was for that product?

Yes, for that product specifically. It was very difficult. Like, the first hundred K, I remember, it was a very difficult process. To raise pre-YC, we had just gotten about 10k in a grant from MIT because we were doing research into GitHub repos. So we were looking into programmers and their work on GitHub and just kind of analyzing the commits and how we could find patterns essentially. Also, trying to identify the best programmers out there based on their work.

That early research actually formed the thesis and the infrastructure for Tara as it stands today.

Oh interesting! When we said Tara, we officially launched—not even like the website or the product—but just launched with the idea in 2017.

Okay, and how did the pivot go with your investors? How did you go about communicating that?

So our investors were very supportive. When they heard about the market that we were trying to tackle and the product that we were building, they were immediately like, "Oh, here's more money!" So what happened was about one-fourth of our investors doubled down, and so from that 200k when we pivoted, we raised 2.8 million. And so we had a three million—let's call it a three million seed.

Wow, okay! So what would you attribute that round to?

I mean, it was just the opportunity, the market segment, the early team that we had assembled, and then also the early traction that we were seeing from the early ML models that we had applied, as well as early customer traction. So the seed was in 2018—the three million seed—that's when we announced it, but it had really been a work in progress for a while before that.

So you lumped all that money together and called it three million?

Yeah.

Okay, gotcha. So now having raised both of you a Series A, can you walk me through the differences in the process related to it and how you communicated it to your investors, how long it took, all that stuff?

Yeah, so we did YC Winter ’18 and four-hundred ventures as our seed pre-demo day, and that was exciting. So we raised four million then, and we were just charging forward with the product—like, timing first market. And we started having conversations at the end of last year around just raising an A. It was more rapid than I thought it was going to be.

Then I had a conversation with Aaron about the Series A batch and thought, "This is probably a good idea and it's a good guide." So where to do that? So then we joined the Series A batch in January of this year, and that process was about, I think it was like two months that we were in that batch.

So, yeah, two-month process. Just like heads down, super focused on building out our pipeline and just aiming to close the round in the shortest time possible. But walk me through the two months because, you know, a lot of people aren't fortunate enough to be a part of the Series A program, so...

Yeah, comedy, we got it. No joking. So we can get into it, I see.

So, yes, yeah. What was the process like?

I mean, it was informal but intense. As with YC or anybody who's going through the process of getting building something people want and getting to that product market, you have daily insane highs and lows.

I guess what was great was just going into it with a structure of "Okay, let's fill out this Excel sheet, let's know every single fund that we want to speak to, let's work the process and get the timing right." I think that was super helpful in catalyzing how quickly we could close something.

So it was, you know, the standard process of fundraising—targeting the people that you know you want to work with that support, like, your vision—and then going through that cycle of having conversations, second conversations.

I think something we did that was really good, though, was writing that investment memo. So what we did was kind of do the VCs' jobs for them and write, you know, as to why you should have invested in us. And that sort of went out, you know, with the deck off to the first meeting.

So, and that's a very chaotic answer to your question.

Yeah, but so what was yours like? Let's get really specific.

Okay, what was my investment memo? Rough terms. Honestly, we looked at a lot of other memos that we could find out there. So like the YouTube memo—picked that up and really kind of spoke to other VCs that I know about like their favorite memos or, like, how they think about putting a memo together and then used that as a foundation to structure our own memo as to, you know, what is the point of Zypher? What problem are we solving? Obviously, like, how big can it get? And, you know, kind of unpacking what the risks might be and why they weren't really risks in our eyes.

Okay, and how deep were you going into the financials in the beginning up there?

I mean, not massively deep to be honest. In the memo, we weren't—we were just giving high-level like this is our revenue so far and this is the market we're going after and how much we expect to grow in the next kind of twelve months. But obviously, we then had a model to back that up that was significantly more in-depth around the financials.

Okay. And so you go with—would you corroborate that, whose is basically the same?

Yeah, I mean, I think for us had—I can't remember Amber's. What happened during that time?

What happened with us was we spent about two weeks during the program just really trying to nail the pitch. Make sure that we were talking about the product and the solution the right way, you know, just being able to really segment out the story and tell it in a very concise but in a much more in-depth manner as well.

So what happened was we spent about two weeks pre—during the program. And how I found out about the program was I contacted Aaron and I was like, "Aaron, our seed investors want to just pull in and do five million Series A." And they were like, "You don't have to go out; you don't have to raise, and it'll be done." And he's like, "Think about it. You know, you shouldn't rush into these things," and "Those seed investors can come into your Series A as well."

And so what ended up happening was our total fundraise process to go from first coffee meeting to term sheet was nine days, which is insanely amazing. I mean, congratulations on that. Our seed process was so incredibly painful that this was—it was obviously very surprising.

But, you know, our closing process took longer—about sixty days or so in terms of like getting the legal process completed and figuring out who we're going to bring on board for that final 1 million in the overall round.

But I think, you know, one of the things that I will say is we really tried to run a thoughtful process and really focus on the partner and people versus the fund.

And so we totally agree with that, by the way. Yes, it’s really about doing your research and finding the partners who’ve led rounds in other companies that you admire or that, you know, have the right profile for your company.

Yeah, so what happened with us was we were under quite a lot of pressure during that time because we had offers on the table, and there were people just kind of, you know, mining and dining us and really trying to get us to accept their offers.

And it got to a point where, you know, it was like people were literally calling up folks in our ops team to book meetings on my calendar. It got fairly chaotic, I would say, during that process of nine days. But, you know, my co-founders say one of the things—he's, I think, someone who's really the yin to my yang—and for the most part, he was the one who was like, "You know, let's really take our time and think through who do we want to work with that are, you know, essentially just good people in terms of individuals who have a strong understanding of our market and of our customer."

Can speak with it, can be thoughtful because the product is fairly technical and we're selling to a technical audience as well. So having the ability to actually understand—and from the engineer's point of view—that was something that we were really looking for.

And I think what ended up happening in our case was we decided to work with a boutique fund, so Aspect Ventures, who are now Accru Capital. And Teresa, go Lauren. Chladni, Assad as a colleague. Like, for us, it was really about the team and very specifically the board member that would be coming onto the team.

I think you probably knew early on, like in all the conversations you were having, like whether that person or that partner really understood what you were doing?

Yeah, and I think looking back with hindsight, I wish I maybe kind of ended some of those conversations earlier just with people that I was, you know, really trying to convince that this is wise.

I think it's amazing, and this is why it's great when they were so not experts in this space, and so you were just attracted to their brand or something.

Like, I was attracted to that brand name, and, you know, it's always very exciting when a great brand name reaches out to you and is, yeah, especially if they're being aggressive about wanting to get a meeting. And then you take the meeting, and then you realize, actually, they don't really understand this space. I wish I'd been more, you know, assertive with ending this conversation sooner and really, like, doubling down on “Do these people actually have my values?” You know what? There's always somebody out there.

I think there was—I mean, ADA's process is amazing. Ours personally took about sixty days to go through, and I was flying, but also back to London to meet other funds there. And we actually ended up raising from a London fund.

Yeah, so we're meeting people here, and so it was, yeah, and then it was holidays, and it just always drags on longer than, well, for us, than you think.

So it was that sixty-day process and then longer to get the legals. But I'm glad that we went through that because we did find a great partner who were—me and you when, you know, they immediately get the space and that's just awesome.

God, I have to say they—so I'll just give you one example, right? We did—I mean, we did three full partner meetings, so that's when all the partners at a fund ask you to come in, and the partner that’s sponsoring the deal or sponsoring you as a founder is essentially the champion.

And they really want you to come in and really present the story, this is Lou and the market and, you know, why this is going to be the next big thing to the full partnership.

And, you know, we had done three of those meetings, and so we had offers on the table. And what happened with Aspect was they approached from a very personal stance which was to really get to know us as founders and really tried to understand what makes us tick and then also where this, you know, where this company could go.

And so even during those nine days, I had the opportunity to speak with founders of portfolio companies at those funds. But the other thing I just remember was when we were at one of the final meetings, and they found out that I love bubble tea.

And so they remembered this? Yeah, they had, they had like an array of boba just on the table. And as soon as—I say then, I walked into the final meeting where they had the term sheet.

So, included in those nine days, are you meeting them for the first time? Because oftentimes people start months and months and months before, like, grabbing a coffee with someone.

Yeah, first time, first time.

So, from the first—in terms of, for those few funds very specifically that got to the final part of the process, we met them for the first time.

So, I mean, I don't know when you can start or time it, but it's really like the day that we met them, from that date to term sheet close.

And by the way, that's a term sheet; it's not when your round closes. A term sheet is actually—a lot of founders don't realize—is that a term sheet can be considered an LOI—it's really a letter of intent.

It’s kind of like that first part of the process; you can't even consider in an offer. In some cases, people renege on term sheets all the time.

And when we got the term sheet, I wasn't celebrating whatsoever.

So I’m like, I remember we got our first cash in the bank.

Exactly, so getting the term sheet was just the first part of the process where, and, you know, for us, like, we were like, "Okay, we have a few offers on the table." And actually, we ended up taking a lower offer only because one of the things I always tell founders—and I just think I personally believe—is that you shouldn't maximize for valuation because if you maximize for valuation, then, you know, incentives aren't necessarily aligned.

What you really want to maximize for is are we getting to work with the right people? Because, and they also, it's a long-term partnership.

Exactly, like, it really isn't just a quick thing; you are in it together.

Exactly. So, you know, one of the investors that we had literally put a blank term sheet.

So the idea was that we would put in the evaluation, and I mean, it's a tactic for hate. And so, you know, it's like I immediately saw that, and it's like, "Okay, that's a tactic." Like, you know, you don't want to play these games.

At the end of the day, you're building a long, exactly long-term relationship.

Yeah, and you know, for us, like, we're like, "Okay, we're just—you know, we're just what we want to do is just work with human beings."

Yeah, and so I loved about, like, Talus, who led the round. It was from the get-go—I mean, I was doing conversations with them at like midnight hour here because they were based in London.

But, you know, there you go. You persevere, you get that term sheet, and the money.

And you do realize, like, when you do click with someone and they have that great personality and that they are, they really aren't pushing weird games with you.

But I also think this goes back to the founder pressure to build momentum and urgency in your process. How do you do that?

So many founders ask me that as well as, like, how do I create this optics, this sense of urgency? And it's dangerous, you know, because you can be tempted to say, "Oh, what, we have this other term sheet, we have this other offer," but blah, blah, just don't ever do that because it's so small as a community, and just be honest exactly about it.

I can't agree more.

Yeah, I think one of the things that happens is, you know, founders tend to, like, exactly you said it right, like, they have a lot of pressure.

One of the things people try to do is they try to be, you know, slick about it when you don't need to, like at the end of the day, whether your round takes nine days or nine months, it's really about just finding the right person and the right partner.

So that's what I want to jump in on. It's not that different from just interviewing someone to work at your company, right?

You kind of need a little bit of a culture fit. So what are the questions you're asking? What are the things you're looking for, whether it's body language or vibe or whatever it might be, to signal to you that, like, "Okay, this is working; like I think I want to work with them"?

Yeah, I mean, I think for us, it was really just how they handled some of the early customer calls.

So, you know, like, were they even finding out things that we didn't know? Like, were they so insightful in their question-and-answer process that they were willing to back information to us that could help in growing, you know, growing the team size at that company in terms of platform usage?

And so there was, you know, there was that piece. And then there was also what I was looking for in particular was do they really understand how we’re trying to build the data layer?

So one of the things with Tara is that we integrate with JIRA, with GitHub.

And so the idea is to go from spec to issues or your issue tracking software which resides in JIRA, and then also go all the way to commit where your version control and source control in terms of the actual code commits.

One of the things we were really looking for was do they actually understand how important integrations are going to be in our play? And also the value that we're providing.

And also one of the other pieces was everybody was saying this was category creation, but we really wanted to work with someone that had done category creation before in particular and understood what it took to march forward and specifically really tried to own the category from the get-go.

So there were certain things that we were looking for.

And I think, you know, even if I look at it in hindsight, I think we were able to run a thoughtful process in those nine days.

What I found really fascinating was post-term sheet as you go through the closing process and, you know, the level of documentation in your data room and what you need to have prepared and ready.

At that stage, it's really important with a good law firm.

So one of the things that I honestly discounted was I was like, "Okay, you know, I think the most important thing is to find the right partner, and then the legal stuff, you know, it's basically something that a good reputable law firm will be able to figure out."

Turns out the amount of follow-up that they required, that the legal firm required after—I mean, it was just, it was really like we didn't celebrate until the cash was in the bank.

Yeah, it was a good sixty days after signing the term sheet.

I feel also some good advice we got was negotiate a cap with your law firm to do the legals because it will go over, and it will end up being thirty days or maybe even sixty days, and so I think that was a good bit of advice.

I think some of the questions that I asked the funds in that process—and it's really important that you do ask questions back because you are going into relationships.

You don't just want to not ask anything about who they are and what they care; some early indicator—the same as if there is like, "Okay, how do they handle their customer calls and how are they coming up with features or suggestions for the product?"

Like, are they—so you can tell early on if they're obsessed with the product and what you're building because they will give you features suggestions.

I would then follow up with the customer calls and say, "How did it go? What did they think?"

And so often there would be this kind of joyous enthusiasm, "Oh, they were so excited about the space." And so I think that's a very early indicator, like do they really care about the product?

Then ask questions back, like, "What do you understand about it? What do you think we should be building in it?" Because then they're building a vested interest in the company from a very early stage, which I think can help push the process along quicker.

So definitely asking key questions like that.

And in relation to that, what about the people that you kind of should have said no to and kept taking meetings with?

What were the signals you saw there? Like, "I'm probably— they’re probably gonna say no anyway; I'm wasting my time," or would you have still taken those meetings and gone all the way through with it?

Hmm, tricky.

You don't know. I think a lot of the time where something is going to lead, and I think that is the classic, like, the vagueness of VC and a little unwillingness to say yes or no.

You kind of get lost in that, like, gray area for a while, and you're all kind of hoping that something might happen.

And I actually—that's probably a telling point is that funds can operate quickly; like, you can move fast with paperwork.

Maybe it is a hot deal, it's very difficult to artificially create a hot deal. If you are a hot deal, you've got a great product, you've got great revenue, and pro-to-market—you are—at this stage funds will move quickly, and they can give you a term sheet.

However, I do think that one question I asked early on was, "You know, what is your process? Tell me how does this work for you." Because whilst they can be fast, they still, you know, have to present to the partner meeting.

And being mindful that they also almost are entrepreneurs themselves that they have to validate it to their LPs and they have to get buy-in.

So working together on how to move that forward and really understanding from their perspective what it's gonna take to get this signed off I think was helpful for me.

Yeah, and I think I'm just to kind of look at it as a process. And we want to present an overview. The first meeting is usually the single partner meeting, which is the coffee meeting, and at that stage—and for some founders it may happen with an associate or a senior associate or a principal.

What you want to do is make sure that you’re meeting with an investing partner, and so they would usually have general partner in their job title.

Yes, think about this whole question that gets asked so many times about whether you should take a meeting with, you know, a principal or associate because I think they can be great advocates for you.

Yes, and so I don't have a black-and-white answer to that.

Because the thing is that Aspect, we met with a senior associate and that's how the—and I mean, it was still a short process in terms of getting the deal to move forward.

So I think the most important thing is to meet with senior associates that have influence.

How you can figure that out is really just go onto their LinkedIn and see how long they've been at the firm. Are they someone who's really an analyst but has the associate title?

Because sometimes you can have inflated titles at VC firms, and so if they've been there for a few years and, even better, they're sitting on a board, like, let's say their board observer, then you know that this is someone who has influence at the firm.

And that was just my very quick vet to, you know, in terms of deciding.

Yeah, I mean for us it was just such a short process, but that would be the advice I would give. Now, if you look at the actual process, the first piece is that the coffee meeting, right?

And that's when you meet with the ideally the GP. Sometimes it's a senior associate, and you get pushed forward to the GP.

If the senior associate is serious enough, they will bring the GP into that coffee meeting. In our case, what happened was some of our early—from those three funds, one of them in the first meeting itself pretty much, they had like four people there, and it ended up being a lunch meeting.

So it can be a coffee meeting or a lunch meeting in terms of that first meeting. Then, if that goes well, they’ll pull you into a Monday or Tuesday full partner meeting.

And so let's say if you have lunch or coffee on a Wednesday or a Thursday, by Monday or Tuesday you could be presenting to the full partnership.

So what happened in our case was we had back-to-back full partner meetings; it was on Monday and Tuesday, and and so that weekend was when we spent really prepping the pitch.

And if the GP really wants you to present your best foot forward in front of the full partner meeting, they will work through that weekend or, you know, whatever that date period is to make sure that your presentation is as good.

I think it's so important just to focus on that because, as your left, as an entrepreneur in this gray area—like, not getting really direct clear signals as to whether a fund wants to do this or not—it's being mindful that yes, the partner will work on the Sunday or the Saturday to move this deal forward and they will do that through the customer calls; they'll do the reference calls as well.

They’ll put the power of the partnership behind this so that they’re able to do adequate and enough research on the company.

And, you know, I think for us on the other piece was Y Combinator and the Series A program really, you know, honed in on the fact that you should have your data rooms ready and prepped.

So we did, and I think that was also what set us as Series A companies apart from even other people that were raising was we really had our documentation in order.

That was, thank you so much, Iron Horse; we definitely got the data room together, and it was very organized—like week one—that was our goal.

But also just want to say on the, like, transparency look, telling the funds that you're speaking to as you're managing this pipeline and you’re having multiple conversations, it’s really difficult to juggle all of these things and kind of calibrate at what speed different people are moving at.

So something we would say a lot is just, “Okay, we just want to be mindful about other people who are in this process.”

Like, you really want a yes or a no, and I think it's fine to push for that. But you need to get an answer like, “Do you want to do this or not?”

And if you have multiple people saying yes, then you're in the position of saying, “Okay, let me decide on what my values are and how I want to move this forward and this long-term partnership.”

But I think be assertive with asking for a yes or a no.

Yeah, and, you know, well, they’re just trying to preserve optionality, and like you're trying to get some clarity here, and you know, and another signal I think, you know, if we can boil it down to signals is that the fund will work to, like, take like four or five hours of your day—like, they will literally.

So in those nine days, I’d be up by 4:15 a.m., I'd start—yeah, like I was—because, like, meetings sometimes would be NSF or they do Menlo Park, and during the two weeks prior during the Series A program and then for those nine days, I was pretty much full-time on fundraising.

So that is so important too as well—it's that being able to be in a mindset where you are locked in raising, and this is what's so great about when you're doing YC—it’s like, what's your M&A goal? Does it fit your goal? Don't do it, right?

And that is the process that you need to be thinking of. When you're fundraising, it's full focus on that as much as you can because that's how you're gonna get to close in nine days or, in our case, sixty days.

It's so pretty good. The thing that's not obvious in my experience, you know, interacting with founders, is that it just takes up all the time anyway because it’s in your head.

So all of us that like the meet at the coffee meetings, maybe twenty minutes and say you spend an hour getting there, an hour getting home, whatever, but then you're reading blog posts, you're talking another phone, you're doing all this other stuff.

So that's why you really have to time box it because it will just get into everything.

Yeah, like I will say we were grateful and lucky that even though the process, you know, it was nine days, but we did get to spend approximately—I want to say seven hours—approximately seven hours with each partner.

It's great! And, you know, I think it's interesting. Like, I feel like that's also almost become a gauge for us even as we go through a hiring and recruiting process for candidates.

We'd like to spend a good seven to eight hours.

I feel like it's, yeah, I think that's a good gauge.

Great! I will say that we actually had conversations move pretty quickly to WhatsApp like to check.

Yeah, so I was already building, like, a lot of her poll like back and forth on WhatsApp and keeping it top of mind, and just, you know, that helped definitely with the speed texting Aaron at like 11:30.

Oh yeah, yeah, Aaron. So, you know, a friend of mine’s going through raising his Series A at the moment, and it's just so useful to have other founders around you who you can just rift with because there's this whole new lexicon that you need to learn of how you are communicating, like what the process is like, you know, what the optics are—everything.

And just being able to have a sounding board. Like I definitely texted Eva multiple times, saying, “Like, how do I do this?”

And yeah, you need to have that space to just have a sounding board to talk things through.

It's like I didn’t have a co-founder.

So I think, you know, thanks for responding to my text.

So one thing we wanted to talk about was what this was like being a female founder. So obviously, I've only done this one time; you haven't been a male in another life and reincarnated. But, you know, other founders who have raised Series A. So this is kind of interesting to talk about.

Yeah, in your experience, how do you feel like it is different for you personally?

Yeah, I think from my personal experience, I mean, we were so lucky to have Four On A, you know, female-founded VC to lead our seed.

So I had the experience of what it was like to sit with, you know, partners—like female partners—and it'd be a very comfortable kind of open conversation.

And I think what I hear from like other female peers and in my own experience is that often you're walking into, you know, a boardroom partner meeting where there's not a lot of diverse representation, and you therefore feel pressured to take on maybe, you know, more male characteristics—like just being more aggressive or, you know, just—

Did you feel pressure to wear a hoodie?

Did you know what? Big deep voice; it's an outfit that I would wear like as I did this somewhere as well. Cause I don't want to think about this. So I would wear—I think I might have even worn this like trouser suit corporate street wear; it’s my little trainer, little trousers on.

And then I do you think it is, you know, that is signaling in a way, so I didn’t ever wear the hoodie.

So it's like, it's just not my personal brand; I'm not some avatar. I did the video during our seat, so I was just constantly trying to look like a programmer.

It's just—yeah, I mean it's sad honestly.

No, but it's also that—that is what the valley has been conditioned to see and interact with.

And I think that the style of communication that is familiar and it has, you know, pervaded the space. Doesn't it feel so good to be able to wear whatever you want?

Oh, absolutely! Yeah, able to be yourself; that was something that I had to learn and I had to grow up—really!

Yeah, I’d like to be able to just be myself, like, I think you—you face so much pressure to act a certain way, to be a certain way, to look a certain way.

And, and I think, you know, one of the things I've actually been doing is listening to analyst calls for public companies.

I love listening to earnings calls. This is my new favorite thing—other than podcasts—is just for straight-up earnings calls and especially if you listen to earnings calls by, like, minority CEOs or female CEOs.

And I think, you know, bottom line, what I’ve, you know, had to kind of train myself to do is bottom line is that it's really going to be about the traction and the team that you put together to, like, to go after a problem.

And so, you know, so I think one of the things that I also think, you know, even since we did YC, things have changed since that massively basically and I think you're seeing there's definitely—like, we, at least, I mean for our Series A, we saw more representation in terms of the team structure.

So though the senior partner, principal and analysts, we definitely saw more representation in the funds that we were talking to.

And I think also people are more—more, I would say—they're more used to, like, listening to the fact that founders don't necessarily come from Ivy League backgrounds or are of a certain race and I think, you know, or understand sports references.

So, I think for, you know, for me, I was like, "Okay, I don't need to learn the lexicon behind American football."

Like, you know, I'm someone who understands soccer, as it's known here.

Yeah, yeah, yeah, yeah!

And so I think that was something that, you know, I had to guide alert but you had way more to show, too, and the confidence behind that.

Like I'm not—that’s what it is, right, is that you can't—there's nothing to lean on. You can't—I don't think you can use, you know, being female or minority, as like a crutch; like if you have great product in great traction then you get a hot deal and, like, any other kind of justification as to why you're not getting term sheet, you can't really say that.

Like you need to have product market fit and a hot deal and, and that's no inner, you know, my opinion.

But I do think it is a full circle; like, there are great organizations, like Always, pushing to have more female, like, partners and also more female LPs. Like, it’s not just Ask going out there; it’s like there’s not a lot of, like, female entrepreneurs who are walking into these VC offices anyway.

And that is a problem that we need to solve is that we need to bring that education and like positive role models earlier on into the education standard.

What do you think of this notion? So, I've been hearing from a couple of female founders that one thing that, you know, that really—that's been worrying them is that whenever they get introduced into a VC firm, the automatic assumption is that they would want to talk to a female partner.

And so then they get introduced to the female partner whose axed only been at the firm or fund for, in some cases, lesser time and may not have as much influence as someone who's a much more senior partner.

Have you heard of this?

Yes, I definitely—I experienced this, actually, past me.

It's also, but I will say that I think that funds are grappling with how to deal with this, and, you know, the most sensitive way, I think the way it needs to happen is that, you know, founders should be able to talk to the partner at the fund that understands their industry and their business.

It's not something else; it's, you know, they shouldn't automatically assume that because, you know, this person is a female founder or a minority founder that they should talk to the female or the minority partner.

It should really just be fundamentally about expertise in the sector.

Yes, exactly.

But, okay, so all of your—were they just warm intros for both of the funds that led your Series A?

Yes, it was quite a cold intro.

Yeah, yeah, it was an intro, but it wasn't a warm one, so it took a lot of—I took a lot of time to get to know them, and I think I actually underestimated how awesome they are early on because we had so much interest when we started raising out here.

Like, it was just, it was overwhelming, and I kind of kept it more on the backbone, also because we were out here and not in Europe.

And then investing the time to, you know, get to know them more and more was—it was interesting, but yeah, it was more cold than warm.

Okay, so yeah, you are in control of that to a certain extent. You're like, "I'm trying to meet this person who knows them," right?

You would think so, but I feel like in some cases, you know, with some founders or some situations, it might be that, “Oh, you know, I’m finally getting to meet this firm!”

And so you just kind of take whatever meeting comes your way, and it may not be that they're the right person.

Actually, you know, I think I made that mistake.

I don't—I think you definitely did that. There were funds that I was excited about, and I didn't really upset—I’m getting in and as opposed to being like, "Hold on! I need to speak to this person because they understand your community," and SaaS companies.

So, yes, I could have done a better job there.

But I do think that, you know, there's a great—like, always statistic. That 2009, 410 companies who had female founders got VC funding, whereas last twenty nineteen, two thousand seven hundred companies got VC funding.

So there is a massive, likely positive increase that we should be talking about that there are more diverse founders, and there are more diverse partners, and therefore we’re getting more funding.

So I think in general, like, we are moving to a much more positive, like, balanced ecosystem.

Yeah, absolutely! I mean, it’s why I love being out here because the default mentality is optimism, oh hundred percent!

And the agency too—yes! And you can meet anyone, you know, Twitter DM.

Sure, I think I had a couple of partner meetings actually just from a Twitter DM!

Yeah, I mean if you make great stuff, people recognize you.

I think that's such a great point, and that really is what it comes back to, is like, if you make something great, make a great product, have great traction, like, you're gonna get the meetings.

And don't go into a fundraising process too early because it will just kill your soul! Just wait till you have really built the great company, and, you know, maybe you even want to be profitable.

I do want to talk about kind of the psychology you have to get into to fundraise.

Yes! So yeah, one thing that we were talking about before the podcast was addressing, like, "How big can it be?" type questions.

So how do you go about getting in the mindset to answer that?

I think having an executive coach—something I should have done earlier—and, you know, in YC, there's actually a company in our batch called Torch who do—it's actually coaching and I got on that.

We started focusing my sessions on that. It's just like getting powered up, getting ready.

And also you probably have these traits innately as a founder anyway, if you're going out there and you're really pitching your business to customers all day.

So it's really like leaning into that and just, do having a coach can help bring that out.

And, you know, maybe listening to that Goggins Berk—like just getting the mentality of like winning is great because I think that, um, you know, maybe this is controversial to say that I feel like the appetite for risk for a lot of female founders to really answer that question, you know, how big can this be, it's more realistic, perhaps, about “Okay, well, we have product market fit; the product's gonna change a bit, so realistically, we're gonna IPO here.”

So there's more of—it like there’s a less aggressive approach, I think, it's—and the answer of how big this can be then.

I think I've definitely seen some of my, like, male peers take, where they're like, "Let's make twenty billion dollars next year!"

And I think it's balancing that, right? Like you want to be completely convincing and have, of course, your own conviction and how big your company's gonna be.

You're not doing this for any other reason, so—and you're not also a sociopath who's just lying to people.

You cannot be that either.

You know, you don't have five timesheets—like, yes!

And it’s a balance of, yes, you're not a sociopath psycho, but you also need to just really believe in yourself and that is so authentic when you see that in conversations, and people like have true conviction in that.

And you need to convince the person sitting on the other side of the table that they are backing the right horse and you will win.

It's important!

So in addition to, you know, listening to the David Goggins book, whatever, what are the things to not do that might negatively affect your personal confidence?

I think, let's see—so one, I mean, I think we even touched upon some of those things during this conversation, which was, you know, just be true to yourself.

You don't have to make it seem like, you know, that it’s a hot deal, like I've seen some founders do that, and it's deceptive.

And the thing is that deception only works to a certain extent—like, you know, like you said, right—it's the valley is a small place, and so what you want to do is be true to your…because—and be true to the partner you're going to work with because you're—that person is really becoming a part of your team and a part of your company.

And in some cases, really, I would say over, even a part of your founding team because if you're under twenty people when you're raising your Series A, then this partner's going to become a key part of even day-to-day operations.

And so I think the, you know, some—I would say probably some things that founders negatively optimize for.

Number one would be valuation. So I don't recommend optimizing for valuation.

I think then you have to work up to that valuation, and obviously, you know, we've seen this nowadays, right? The challenges that are happening in the IPO market.

So I think you know, it's—it's very important to come together and, like, really come up with a valuation that is optimistic but realistically optimistic.

There's a lot of data out there that you can use to make this decision! Right?

Like it's a 3x multiple from your last round or whatever data points you're going to use.

And so it is a conversation, right? Like you are—you both have interests, but you need to align them and make it a conversation, not a kind of aggressive territory-marking situation!

The second thing I would also say is that investors and partners have been doing this for a long time. They understand founder psychology mentality.

They really understand and know what pressure tactics could and should look like.

And I think founders really need to, like, understand and be true to themselves in terms of building a company is a long-term game at the end of the day.

And so what that means is you want to ensure that you're finding the best partner for your company or your business and really take the fund out of the equation.

You know, we had instances where I remember one of the funds was introducing us to like celebrities, where it's like, "Oh, you know, this person sits on this board; they're so incredibly influential! Imagine what they can do for your business."

You mean literal celebrities?

Your sociability—and like that happens too!

I mean, yeah, I think they really, you know, they read the room so they're like, "Okay, that's what these founders would...”

Yeah, and so that's what happened.

And, you know, I'm just—I'm so glad we really didn't get pulled into the, you know, glitz and glam of the whole thing—if we can even call that.

But I think just being—staying true to yourself and really, you know, being heads down.

I think that's what's really key here.

What do you think is the—you say: "Look for partners who share your long-term view; it's long-term building a company," but what, like, how are you getting the evidence of that?

Okay, so what I did was I asked pointed questions to the founders, and I honestly, I'm really grateful that those founders were truthful because I think Natalia comes, yes!

Exactly!

Of their portfolio companies. So I specifically asked pointed questions. I really tried to get to the bottom of things.

And, you know what you can do is you can set up a question, like, in it—it's fascinating, right?

You can really set up a Q&A process where you're really getting to the—where the rubber meets the road!

And for me, like, that's what I wanted to do, and I think it's—even me, I would probably even say made me a better interviewer!

Yeah, even in our recruiting process and our candidate recruiting process.

And so that I think— and you can, like, I got to a point where I could really tell where founders were not being necessarily truthful and were just kind of, you know, really trying to get us to say yes to the deal.

And so I think that is— that's what's really key: like, do your homework, but then come armed with very specific questions and really try to ask about what did that partner do when things went south?

Watts, exactly! So it’s like speaking to founders who, you know, maybe had a hard time.

Yeah, do that channel, exactly!

So you also need to back-channel and talk to founders that they didn’t. I'm sure you too, exactly!

Yeah, yeah.

So let's talk about what it's like to now run a Series A company.

So for both of you, what has been the biggest shift?

I will say, so we moved our headquarters out here to San Francisco after our Series A. Previously, we were in London; we had a New York office and then I just decided let's consolidate this.

Like we need to all be under one roof early; that’s get to the distributor team face a little later.

But one thing I started to prioritize was culture, really; was what are the values that this company is going to stand for?

And prior to raising the Series A, I was just heads down on revenue. I was like, "What am I at Catholic revenue?" We've got to get these numbers!

And I kind of didn't really put enough time into thinking, "Okay, you know, what is this culture? Who are the talents that we're attracting and what are the values that they care about?"

And I think spending the time to really come up with that. So I spoke to some of my, like, early founding team. I was like, "What would have—what are the values that we care about in each other? You know, why is this work so well for the last couple of years?"

And we came up with those things and then I was like at tech recruiting day and it made me laugh at how many companies are coming up and having like acronyms for like what their values are.

It's like our values a cake—community—assertion, and I know just made me laugh!

And so I then channeled—I was like, could we come up with some, you know, could we make this an acronym?

And we ended up making it the tricep flex, which is like an old-school exercise poster, and it was, yes, because it’s kind of eccentric and definitely brings out like attributes in our character.

And it's really helped with recruiting because it’s given us a way to score people.

It's who we're bringing into the team, so I think that’s something I focused on since raising is like really spending the time to think about, like, what is the culture that we're building?

Yeah, I think for us, really post-fundraise, one of the things we really focused on was people, and that was building the right founding and leadership team at the company.

So when we did our Series A, we were about five people full-time at the company. Everyone else was part-time.

And so now, by the end of this year, we're going to be about twenty-one people full-time.

And, you know, so growing 4X—I mean, we're still pretty small, we're still early-stage—but that being said, growing 4X is very difficult.

And what we did was we really didn't want to compromise on the people that were joining the team because we know that they’re going to be leading their own departments over time.

So one of the things we did say is, you know, it was with someone who really was like, “We absolutely have to make sure that we're bringing on the best people possible.”

So now our founding team consists of early software engineers from Nest, Google, Apple, Atlassian, and we've really brought people together that have this common mission, common vision where everyone says, “Okay, we know software product management is broken. You know, the tooling you use today is fragmented.”

At any point in time, whenever you're going through this development lifecycle, you really can't understand what is going on with whether you're starting from the initiative at the VP level all the way down to the issues, and then even tickets that are being generated in your existing project management software.

So one of the things we really did was we tried to find our tribe.

And I think, did you write down the companies that you wanted to recruit from?

Interestingly enough, well, besides, you know, just the adjacent companies, 80% of the companies that we ended up—like, in terms of like from the founding team perspective—were not the companies that we had written down.

Hmm, and I think it’s because you assume a certain—like, for example, one of the things we knew was CIC deep; like hiring from CI/CD tooling would be interesting because the messaging is very similar where they’re focusing on product delivery because that’s what we do—what our product does.

And then we very quickly found out that hiring people that have been late-stage at these companies is very different from really hiring people that were the first twenty in Italy agree.

And other founders in our batch have closed a series A and now building this team, it’s funny how, you know, a few of us have made this textbook mistake of maybe bringing in like senior people just purely funny because you read about it in every single book.

You’re like, you know, don’t bring in a—it is too early, and, you know, a lot of the time, you end up making a mistake.

He is to bring in executives that have been early enough, so yes, really.

So some people say they've been early; then when you again go down the path of questioning, and it’s like, “No, were you really there when it was a garage or were you really there when, like, post-series A?”

And then was even the post-series A considered early enough at that time?

So, and why do you think it's important to like get those people who were so early?

I think it’s because they understand the level of hustle that's required very serious—they know there’s processes that have not been put into place that they're going to have to come in and put in the processes.

But then it's also, by the way, what not to have a Pen rule. You know, the other thing is that it’s only very few founders that can also do this only because it means you have to be willing to give up ownership and control, which is very hard to do.

Yeah, and so when you’re bringing in people that are much smarter than you in that area or domain and are essentially— you know, just you really understand that specific domain, you need to be willing to take a step back.

Let them own their own their domain, let them hire their people, let them run their department.

Absolutely! And so we’re at that stage where we don't—I mean everybody's in engineering right at this stage.

We haven't started building on a sales team as of yet, and so but at least for these first twenty people, and we knew that this was—this is going to be the founding team.

And so each of these individuals will have their own departments over time.

And how do you recruit from people who have offers at big companies?

So it's easier said than done.

So I remember so you know, like when we first brought David Keith on board, who is our lead engineer, he, you know, he was very intensely—like, he was someone who felt very strongly about the mission and vision.

And then as we started building out the early engineering team, what happened was people had offers from Google, Amazon, PayPal, and in some cases, especially when you're hiring early stage, like people have been early stage.

What usually ends up happening is then those larger companies just give, you know, another like bonus package of let’s say another 250 to 400K in stock.

And so you really have to find people that believe in the mission and the vision.

And you, as a founder, have to be, like, able to actually paint that picture.

That's what's most of my fan!

And they really—like, it needs to fundamentally come from the fact that are you building a category-creating product.

And is this something—are you really taking on a giant incumbent?

And is this also a daily frustration that that person has faced?

So one other piece is that we were lucky as well that in the founding team that we've built, every single person has faced the frustrations that we're trying to solve.

So that did make it easier for us.

I think also people need to be educated on what it actually means when you're a Series A company because I think that it possibly can look that you all are further along—you are!

Yes, like Series A is still so—and yet you've brought a market fit, but it's still a little chaotic and scrappy and things are gonna change.

And product-market fit is a step ladder. So you're going to have it for a little bit, and then you’re gonna suddenly lose it, and then you have to change your product again!

And so that's really how it is.

Yeah, and I think one of the, you know, one of the things—it's really important to understand.

And even as a—so one of the things I had to grapple and come to terms with was like I had a lot of growing up to do personally as well—like a post-post—and again, I know this is—we’re still early stage.

But even then, as a founder, I think for me, like, board meetings were just this giant thing that you see, and you hear, and you talk about, but we had never—I had never, like, her inducted a board meeting.

So conducting my first board meeting was definitely a task and an experience unto its own.

And I think, you know, I can’t wait until YC is like a dedicated part of the Series A program.

Where you'll eat—each—because closing the A is just the first part of the ball game.

And I think even learning how to run and conduct productive board meetings was something I only learned over time.

Like, our first one was we just thought about—we just had our first one.

And you know, I did a bit of prep; I sent out a board memo before, you know, it should have been a week before.

It was like midnight, it was like enjoy listening to us!

And then, you know, I think it’s so helpful for it to be a discussion.

And yes, we're giving an update on, you know, performance and where things are going, but it's equally an amazing opportunity for you to leverage the insight of your board members to discuss what you should be focusing on.

You know, it's—it doesn't have—you don't have to be an expert in round one, and everybody knows that.

So I actually didn't put a ton of time into learning about this. I was like, you know what? Learn from experience. I’ll like ask if you found us how I should run my board meeting and like just dive in.

And then I asked for feedback afterward like, "How could I have made this better?"

At their work, maybe could have sent the board moment like a week before?

That’s a good point! Two days is usually typical; you don't have to do it a week before.

Two days is—you're good!

So we do board meetings every eight weeks, and it's every eight weeks, every week.

So it’s—wow! It's definitely, I would say it’s a significant undertaking.

But that being said, it enables a forcing function, so good!

And also, I think going back to the whole earnings call thing was, yeah, really, that was actually the only prep that I really focused in on was, "Okay, how are these people running their earnings calls?"

Because if I can take learnings from this, I can probably run a relatively successful first board meeting.

But also, I shared my board DAC with the team so they fell by, you know, of what we're doing and kind of in the loop.

Just to build that, again, like transparent, candid culture of this is what the feedback was, how did you—how do you follow up with them?

So one of the things that now happens, at least for the last two board meetings that we've had, our leadership team kind of comes together and they have their own domain areas.

And so, for example, at our last board meeting, we had our team leads present as part of the board meeting as well, and there’s—yes, I also did that!

And so they—kind of talked about what areas they were owning, but then also what are the OKRs that we are aiming for for the quarter and then how those OKRs translate into monthly milestones.

And we actually—so one of the things we did post-Series A was we instituted OKRs for the first time.

And I think, you know, it’s buddy—the top three takeaways from that.

Top three OKRs: number one is don't make your OKRs too big; number two, ensure they're measurable—it needs to be a certain number that you can hang your hat on and be like, "Okay, did we meet this? Yes or no?"

And then, you know, that’s— that’s a function if you can even put it as a percentage in some cases.

But I always like the yes or no, and then number three is ensure that there is team buy-in, so one of the most important things I believe is that the team needs to come up with the OKRs together.

So we—as team leads, we get together, and we really define like, "What is what's important for us for the quarter?"

And then, what are the monthly milestones that we want to set?

I think the other piece is, you know, I think one piece of advice I would also give to Series A companies is, initially, you know, I thought a lot about how often we should have our board meetings.

So the typical cadence is usually quarterly, but I think that, you know, if you want to continue being at the same pace that you’ve been working at in terms of from a workload standpoint, I think having them more often is better than having them.

Are actually disagree with this statement!

There we go!

I think that we have our cadence currently is twice a year, but I probably raise another round before we, you know, continue with that.

So we've had one, and then we're having another one in March.

However, I am in on our monthly updates!

Like I am, like doing our monthly investor update.

It's like I have calls, but I guess my concern with having them too often is I don't want to spend all of my time, and I'm sure you are not doing this—and I need to quiz you on how you are being optimized about it—but anyone spend too much time preparing a board deck?

Like I wonder what you do—is cute take your all-hands updates and have them into your—the board.

So that's the thing because we do weekly All Hands, and we're also doing monthly investor updates as well in terms of calls, but the easiest way to do this is to literally take a lot of the components and pieces of the All Hands update and translate it into the board decks so that you're not spending a significant amount of time building the deck.

And once you have—once you've done your first board meeting, you have the format and template down, then it just gets easier to build the next one anyway.

And I think, you know, for the most part, what we optimize our board meetings for, and I mean, you know, I think, and I think will only improve over time is to really enable decision making.

And so if there's any kind of specific decision that we'd want to talk through or have working sessions on specific areas that we need to delve deeper into, that's really what we're using.

Yeah, I think Sequoia has a great post on this as well—just how to effectively honor, there's a lot on there.

Yeah, so, okay, so just to wrap this up, last question for founders raising their seed or Series A: What would be the single most important thing you would tell them?

Focus on the partner.

So really focus on the person that you're going to be working with because, I mean, I used to laugh when people would tell me it’s a marriage, and it’s—it’s really—that is absolutely true. So really focus on—and finding out everything you possibly can about that individual and, you know, don't just read press or read the Forbes Midas list, you know, to like figure out how many times they've been on the Midas list before.

Yeah, I think I think go a step further and really, really do your reference checking or your back channeling on the specific partner because you know because, at the end of the day, it may be that the fund is choosing you, but you're choosing the fund and you're choosing the partner.

And it's really not about the fund: it's about the person.

So I think single-handedly that's the most important thing you can do.

I would say two things: one, have a process! Get an Excel, get it color-coded, know where everybody is in your funnel at any one time, and just lock into that process!

Policy, update it, get organized with it.

And then two, I would say it’s to do this executive coaching session or do whatever you need to do to make you feel confident and invincible and have hike action because it’s not going to be nice.

You know, it's gonna be hard, and you need to persevere.

And just remember there's always going to be a yes out there, and it may take you 30 days, 60 to 90 days—like there was, you know, there's definitely people on about that took even longer than that, but they still got great deals at the end.

And don't judge yourself by your peers—just keep persevering with it because somebody will say yes and somebody will find the resonance in what you're doing, and just you want to keep that in a belief.

Awesome!

All right, thanks so much for coming in!

Thank you!