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What I learned from raising venture capital
- djb_hackernews 15y agoHow much did he raise again? He says he didn't get meetings until after the August vacation period. And announced the funding October 13th. Does it really only take 6 weeks to put together a multi-million (?) dollar round?
- wensing 15y agoNo, it takes all the work before you ever talk to an investor plus a certain amount of time which for him could have between six weeks given the traction of DDG.
- djb_hackernews 15y agoNot really the point I was trying to make, but thanks?
- epi0Bauqu 15y agoI didn't say, but it was 3M. As for August, I did get meetings before, it just caused trouble because some meetings I couldn't get before, or there would be large period between meetings, which hurts momentum. And that all adds up to it being harder to align the time-line across multiple firms.
- deleted 15y ago[deleted]
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- Maven911 15y agoThis might be a bit inappropriate, but do you mind sharing how much ownership you gave up for that 3 mil and was there any strings attached ? And how did you finance your search engine before this financing round
- strickjb9 15y agodontbubble.us link is broken - it sends you to donbubble.us
- epi0Bauqu 15y agoThank you -- fixed.
- conductrics 15y agoRE: Congratulations. My wife is a musician, and back in the day,when record labels mattered, many musicians would focus almost entirely on getting the record deal. That was the thing, to get the deal. Sure, there would be stories about artist X or Y who's album had been shelved by the label or the signed artist losing of control over who would be the producer etc. but primarily it was considered a sign that you had made it, you were legit. You just didn't really consider the loss of control that went along with the 'deal'. I think the same is true with funding. Yes, you are making an exchange - money for equity. However, you are also signaling that you are legit, to outsiders and to yourself. Of course, there is a cost to everything, and if entrepreneurs are not treating the funding as a sub-goal, but rather as the goal,then you wind up with organizations that are optimized to get funding rather building customers/long term profits.
- va_coder 15y agoI hope you guys are working on a pro-privacy email service
- epi0Bauqu 15y agoUnfortunately, no time for that. http://help.duckduckgo.com/customer/portal/articles/215614 http://help.duckduckgo.com/customer/portal/articles/215614
- doc_larry 15y agoThanks for your article, for someone outside of Europe it helps a lot to get insight on the process in the US. Ironically, albeit a super interesting write, it's your link to why it doesn't feel right that got my attention! Good luck for the rest :-) good things come to those who work hard !
- nh 15y agoIF Gabriel is reading this: How did you meet the VCs/Angels you already knew?
- epi0Bauqu 15y ago--Angels mainly through angel investing myself, which I realize most people cannot do. --Entrepreneurs who have been funded before from going to events and getting intros through other people over the years. --I really didn't know many VCs. I met a few through entrepreneurship events in Philly. One through an angel friend a while back. And one I worked for 10 years ago.
- eps 15y agoWould you say that doing an angel investment (with no prior experience and no ties into the angel community) is a hard or risky thing to do? I've been considering trying it, but basically don't know where to start...
- epi0Bauqu 15y agoThis is a detailed topic, but basically you have to expect to lose all your money, and if you want to be serious about it (with a better expected value) you have to do a lot of deals over a long period of time. That being said, you have to start somewhere, and the best way to do that is to co-invest with people. I would meet local angels and hook up with them.
- eps 15y agoOK, co-investing makes sense. And by "risky" I meant more of losing time and nerve cells rather than money (which is an inherent risk), but I guess these are connected.
- epi0Bauqu 15y agoWell not necessarily. A lot of people are completely passive. They write checks and never look back. I'm way more high touch and like to be involved, and so the time constraints are more significant.
- heyrhett 15y agoI am always extremely impressed by Gabriel Weinberg's honesty and transparency. He's literally not "selling anything" here. This is just a gift to his fellow entrepreneurs.
- lurker17 15y agoWell, he is advertising his company. Like HN, it's a marketing activity, but one that also has a value-creation component, not merely an attention-grab.
- rokhayakebe 15y agoThat doesn't look or fell like advertisement. An ad would be something like "How we bootstrap our way to 7M searches per month"
- ohashi 15y agoThat's part of the beauty.
- 0x12 15y agohttp://www.youtube.com/watch?v=gDW_Hj2K0wo http://www.youtube.com/watch?v=gDW_Hj2K0wo
- pg 15y agoThis is good. As someone who's watched this process many times, I can tell you he learned pretty much everything there is to learn about raising VC the first time through. The only thing that could make his advice inaccurate is that he was raising money for such a good startup. And in particular, one with traction. As he points out, traction trumps everything. So this is essentially a report on what it was like to travel through VC land in the express lane. The scary thing is, even then it took 4 months. It might have gone faster if he'd been on the west coast, but it still would have been a big time suck.
- ccollins 15y agoWhat are the biggest factors that increase the time suck? Amount of money you are raising, inexperience? Conversely, what consistently decreases the amount of time spent closing a round?
- pg 15y agoThe two biggest factors in the time it takes to close a VC round are how obviously good the idea is, and how much competition there is for the deal. The two are not entirely independent of course. By "obviously good" I mean obviously good to VCs, who as a rule tend to overlook the very best ideas because they seem crazy. So for example it may have slowed things down for Gabriel that he was working on a new search engine, because to many VCs it would seem crazy to try to compete with Google.
- fredwilson 15y agoIt is crazy to compete with google But crazy is good when combined with a good entrepreneur and some traction
- makira 15y agoHi epi0Bauqu! Congrats! That being said, is it possible to see the actual six slides deck ? Thanks!
- epi0Bauqu 15y agoThx! I thought about that a bit, but am not comfortable with sharing it yet.
- vaksel 15y agoif Gabriel had so much trouble, I can just imagine how tough the process is for everyone else.
- Meganduma 15y agoThanks Gabriel, this is great.