How Startups Grow and Raise : challenge your cofounder
May 4, 2015
A team of cofounders is crucial. Once, you have met and found your co-founder, validate your co-founder! But how to challenge your cofounder? A good way is to find founder hacks in the Bay Area and Sillicon Valley…
Sydney Lai is a thought leader in startup communities, with a goal to excel startup hubs. Sydney is a Community and Growth Manager at F50, a private network that connects top founders with professional and strategic investors. With a previous career in banking, she also ended up as a movie extra in the Steve Jobs film starring Seth Rogen.
Hi Sydney, I know you have been in the Bay Area startup community for quite some time now, based on your observation, what do you think is the main difference between a solo entrepreneur and an early-stage founder with a co-founder?
Projects, startups, experiments, hacks–whatever you want to call it–creating anything requires focus and direction. The question that I always ask founders whom I highly admire is, “What do you know now that you wish you knew when you were 24?”
Vladimir Tenev, a Steve Jobs doppelganger and founder of Robinhood, replied, “Focus.” Focus on one project, not various ventures. You and your co-founder function like a check and balance system that becomes a resource for growth and focus on your specific area of expertise. Without a co-founder, a solo entrepreneur would have to be a jack-of-all-trades who would quickly lose focus, or need to find others to fill in the gaps. A team of co-founders is crucial because each key player has an area of focus that they can build upon, whether it be a technical or business role. As the saying goes, “it takes a village to raise a child.”
How do you meet a co-founder, especially in the Bay Area?
We often talk about customer validation. I challenge you to think about how to validate your co-founder. I will give you a secret on how I validate my personal co-founders on projects that I am working on. But first, let’s focus on how to find a co-founder. Assuming you are completely new to the Bay, Meetups are an incredibly robust in the Bay Area. As a Lead Organizer for Silicon Valley Entrepreneurs, I oversee a community network of 35,000+ founders and developers. What is another way to meet or network with a technical co-founder? IdeasVoice is an example of an entrepreneurial platform that has changed the way founders can meet. Indoor rock-climbing. Rock climbing is golf course of the startup world in San Francisco. The culture here in Silicon Valley is that rock climbing is where the techies flock. This is unknown to the outside world.
How I personally vet friends or partners to join my project is by inviting them to attend a hackathon with me. Within one weekend, I can get to know her personality, how she works in a team and her unique skill sets. I competed with a good friend of mine who is a wonderful programmer, however I noticed how awful it was to work with him that weekend. I gained the insight I needed in three days versus experimenting with how we would collaborate as co-founders. Lastly, I turn to my classmates or friends with whom I have worked at organizations or long-term projects, especially work colleagues as I collaborate with them on a daily basis.
A founder story is incredibly important. Prestigious accelerators like YCombinator (YC) will interview how founders came to work together. They prefer a history of a close relationship and having collaborated consistently in the past. YC recruits and invests in the team, not necessarily the idea. Of course they can be picky–they have a 2% acceptance rate.
A lot of founders do not know where or how to initiate raising money, what are the first steps?
Raising money depends on where you are–particularly in which startup hub you are located. The Bay Area is an outlier because investors out here focus on customer acquisition and growth, which inevitably translates to a noticeable business model. I have noticed that other investors, for example those in the Netherlands, want to see revenue traction. In my experience at F50’s funding Seasons, I’ve found that many Bay Area investors believe it’s crucial to see companies that can rapidly gain users to have a critical mass and ultimately monetize.
The best way to raise investment is with growth. Grow 10% weekly for 12 weeks, that’s three times the growth. If you grow 20% a week, that is nine times. Even Tinder has a monetization strategy now. Yet it is not about a small amount of users paying a high price. Investors will look at the big market, and consider the high product number of customers, times how much they will pay. Having traction and customer growth is how your project will initially attract money’s attention here in Silicon Valley. After that, you can go to investors, accelerators, crowdfunding platforms and show them your acceleration, not your velocity.
How do you think a platform like IdeasVoice can better help projects increase their chance of success?
Having tinkered with IdeasVoice thus far, it is a network that allows visionaries to consistently collaborate with their founders and grow that relationship. With the exchange of ideas, founders refine and extract feedback from other thought leaders. IdeasVoice increases a project’s chance of success, by initiating the opportunity to collaborate long term on a shared vision and impact.
To wrap up today’s interview, we want to hear your advice for people who have concerns and fear on starting their projects.
Just Do It. – Nike.
A mistake I have made in the past was extensively research and plan without executing because I feared I was not ready. You will never be ready, never stop learning a skill or finish researching an idea or market. Mark a weekend in your calendar and grab your partner to start hacking away creating your product. Go into the streets and ask random bystanders product questions for market validation. If you need a structured weekend, guidance and a team, sign up for Startup Weekend in your city. You will launch a startup in 54 hours.