Hi. This is heating shop,

and this is still

a hefty. And today, on the start of chat, we're gonna talk about what I've learned through 1000 minutes of customer development interviews with founders who are raising money. I think you like talking about more than

just sales and market. We just want a bullshit chat about business in life. Hopefully, while we're doing them for my long value to be the best business for people trying to get shit way Don't want to give you feedback.

That's bullshit. You want you to do your best?

Yes. So he is currently serving or he did. I think you do. You did. You close the first batch of interviews

it and we close the first batch, marry onto the next

thing they go. So he did the first batch of interviewed founders about their fundraising issues and problems, right? Yeah. And you also did a survey on this.

The survey is now coming us Not even a survey. Yes. Okay, so I've got a link. So let me share the link because everyone should go to the link. Let's do that. It's a bit dot l y so Bentley slash funding early access

funding, early access.

One word. Yeah, And so it's very similar to what we did when we started the podcast, where we put out a ah basically opt in link type form survey. And then we started sending people are episodes and got feedback, right? So what? What my business partner and I have done is we did these interviews and we had just two tweets that led to about 50 different conversations. And this is where I got the 1000 minutes. Yeah, because it's 50 times 20 minutes each, which is

how long was broadcast, I thought That just makes for a great block post title. That's how you

know it's true. It's about it's been about 50 there 20 minutes each. So that's like 1000 minutes. What's that, like, 12 13 14 15 hours or something with 1000 Wainwright s? Oh, we did that. And now our next step is we think we can help people without talking to them by providing them with different things every week or every other day. And that's around fundraise. Yeah, right. So we wanted to get early access list of people together and the intention here is provide re sources and tools, and some of it might be paid. Some of it might be free. Oh, are some of it will be free for sure.

And so that's that's the intent. And the big thing is, we just took an approach that, you know we would take if we were starting something, anything which is go learn about it first, even though you think you know a lot about it.

So that was the thing I wanted to talk a little bit about. But this is gonna be the focus of the episode. But I love. And I got excited what we talked about in the previous episode. I love that you guys did. And you particular did customer development about a topic that you know a lot about already. So, you know, when we when I mentioned this to you before we started recording, you were like, Well, we did the same thing with the podcast. I'm like, Yeah, but we knew Jack Shit. Nothing about podcasting. Like you want to do pockets.

What is a podcast around? Know what do people do there? And so we were very curious to explore and do some customer development and even early access list and and asked me what they want and how they do things but fundraising and helping find it with their fundraising issues. I get a bunch of emails every week about this and try to be useful, Helpful? You get a Thanh um, you know,

you have. We're having people were now between my business partner and now we're at 50 to 100 pitches a week. They only see DAG off pitches or whatever. Maybe more

So you've been around you raised my unit is money. You helped Tom people you've invested you've done at all the angles of this. So at that level of experience and involvement to be like, Oh, I should do some interviews and learn what apple go through. I love that it seems it displaces certain both a certain discipline to process. It displays a certain humbleness in terms of like your own opinion about yourself, and displace a never ending kind of curiosity to which you come to things which I think is so important because I think that all people missed a custom development, exploring things and learning things about areas where they were there debating efficient sauna business or not, if it's something they don't know anything about. But if you're an expert, both the point of doing this so I won't just highlight that you're doing this doesn't matter what it is about. Like yes, right. If you if you have wanted to create one product for once in a customer, that customer is your wife or your child. You do some customers.

There's no I think I know what this person wants. I'll go ahead and do things. I love that. But that then leads me to the next thing, which is the the subject of the episode, which is, What the fuck did you learn? What are things you learned that you don't already know? And it's funny. On the one hand, fund raising and raising capital as a founders of start up there is an insane amount of content already out there about this there. It's just insane, and at the same time it's heartbreaking to me. Hello. The General Knowledge Base is of most founders that approached me about the fundraising problem, and it's not necessarily because they've never read an article about this,

but they still they still show up to this process with a level of ignorance and a level of, um 90. Yeah, that is shocking to my system. Right. And I have I remember being that person myself, and all I want to do is shake that out of their system when I interact with them to get them to, like, really, like, straighten up about this, you know

that It's my first

time line. Oh, yeah. I heard that the most in this process is my first time. Okay. Is that an excuse? Oh, yeah. We did the whole idea. We did the whole episode with the fund raising. It was like everybody.

Really? Yeah. It's interest. My first time. My first time. He still is. My first time. Stanley

was back me and say So what exactly? A lot of that. All right, so that's interesting. So people approached the fundraising process with Lee or the ones that reached up. Do you think that people that have raised my already they can yachts, they're gone? They're not naive anymore. S experience Good of that. A lot of bad sometimes. And now when they go to do it again, it kind of know what they're doing or they know what to expect. At least

so I'm gonna take a step back. Yeah, And then we'll take right to where your arm let's do and more. So, uh, we decided to do the interviews because one thing I'm learned and this is the hardest lesson probably in building a company is even though I think I know I might not. And it still might not, because I think, you know, and you're an expert, and you're like, I might not know. And so I got used to that feeling over, like, the last couple of years, so I don't want to start anything without actually doing a ton of research. Um and so the idea was like,

even though I'm an expert, and I could go hypothesize about these and make assumptions around what the problems are, which we actually did, and then we could go start making a solution. What would happen is what if we were wrong, Then we just wasted all this time on one person's opinion, which is mine, right? Or you, on my partners to people's opinions are a whole companies opinion, right? And so we wanted to go really learn more about it and validate what we were thinking or invalidate a lot of our thinking. We did both. We validate a bunch of things we a bunch assumptions we had, and we invalidated a bunch of other ones. And so I think you need to have a beginner's mindset when you start something new and this is just a way to have it,

even if you think you're an expert, Uh, it's part of what I what I used to tell people and still do, which is like, even though you're an expert, it doesn't mean other people have the same problems as you do. Yeah, because what you're looking for is a problem set across many different potential users. Customers, people not like your own problems, right? And, um, so I just wanted toe. Make sure that people understood this cause like, it's it's every time I do interviews for something new,

the new thing ends up being a hell of a lot better. E can't like. It's easy to forget, all right? Eso expertise, I think, is overrated. Especially when you're trying to start a business around something.

Let me highlight this expertise is overrated. Yeah, especially when you start in your business. Yeah, let's Let's quote, let's sit on hand for a second. Let's print this out, Put it on a T shirt hanging up, write it down, tweeted I think that's

that's the money. You want to start selling T shirts, Maybe.

OK, maybe we'll that somebody thinks that the startup chance should have a T shirt. Let us. Now let us know if you'd be interested in by one. So there's your customer, right? OK, so I'll jump in now. Yes.

So what we wanted to do was talk to a bunch of people find problems on the interview. So what we did is just just just explain, since I am an expert, we actually leverage that. And we said, I want to talk to people about their fundraising experience and also give advice right. So when you're an expert, you can have that kind of pitch to people and get them to talk t like that. That's a value of expertise. Values of expertise isn't your past knowledge. It's what you could do for someone in on an interview to get them to get on the interview else given value right, so We also have one asset that we know will give everyone value. So that asset is basically ah, pitch deck formula. Milestone based formula is what we call it our framework. Don't have a good name for it yet, although we'll soon enough.

And it's one document has one example deck from a friend of mine. I helped raise money maybe about a year ago, and he did a great job. He turned his deck over in three days after a great conversation with me, and then he raised money within another three days before I could show it to anybody else. So it was really awesome. And so we have that asset, so we know we can add value. So the tweet waas talkto talk to us about fundraising and will also give you some advice. So then it was We did 20 minute calls for about 10 to 15 minutes. We ask people about their fundraising experience. We had a whole set of questions, like, How's it going with your fundraising? Where you at? We asked about tools they use.

We asked about incubators if they were in one and their experience with the incubators. We asked about how they made their deck. Where they got resource is from who do they believe, trust and all this stuff. And we got really great answers. We probably even know why certain people really like certain brands out there that talk about fundraising, right? We also know one other thing. I'm just mixing learnings in here. That's a lot of people use. Guy Kawasaki is 10 slide formula. This so fucking old is not even not even for us. Right on blows. It was blowing our minds every time we heard it. Just like I don't even know how they found it. It's pretty old.

Attn This point anyway. So we learned that. And so we basically did 10 to 15 minutes of helping them out with all those kind of questions, Then about another five or 10 minutes roughly on giving them advice. It's specific to their start up. But what we had is we requested they send their deck and all that kind of stop in background before we started. So, you know, So I actually have the finding someone spit through some of them that are actually more interesting. Sweet. And I'm sure we could discuss that S O fundraising takes up a lot of time. That's number one, you know, still

looking at me like you already know that way

we know that. But the founders said that right now here's the part that always bugged me. I know bugs you to. Founders want to be freed up to work on their business product or whatever else they normally do. So they want to be freed up even before they start the fund raising process, because they feel like it's a daunting thing that's gonna take up a lot. So we've seen some things out there that pitch that you can get fundraising faster and stuff like that. This is the reason those things pitch that because the pain point of it's gonna take up a lot of my time is like stuck in everyone's heads. I call bullshit on that, but that's OK. I can't change what they stink without a solution. Um, here's what's really interesting. No matter who the person waas, whether they've raised money before, whether they're doing a Series B round A C round, they have a lack of knowledge about doing it,

and when you dig into why they have this anxiety. I think part of anxiety is this is my business. If I don't raise this money, I'm screwed. Yeah, that's just what they have in their heads. And, you know, in a lot of cases, probably right. I know you are asking about. I think you know all you know. Who are you talking to? Is there bias? We talked to folks across the board, so we talked. It floats that haven't raised any money. We talked to folks that already raised a seed round. We talked to folks in her in incubators and we talked to folks that raised the rounds and see rounds,

but all of them for a month. But all of them for the next thing. Next step of fundraising, they sell. This is my first time. First time raising in a first time. We have that several days. I have. Because when you first mentioned this, it makes me assume that the target group was people that have never raced a dollar. But these people were just thinking This is my first time doing this next step. Yes, yes. Yeah,

that makes sense. So that's basically what it is. And through that Mackett lack of knowledge. They would go ask a lot of people. I It's rare People like to ask other people for advice. I mean, that's common. I don't think we've heard it this much. And this consistently and this many people, they ask advice from per individual 100 20 people. Here's my debt. What do you think? And guess what they're gonna get? Lots and lots of conflicting advice. Completing it was, Here's where it gets awesome when you ask them about the conflicting advice. They sit there and can tell you what this person said this and they're wrong because of this.

This person said that and they're right because of this. But they're wrong because of this. It's like they already knew when they got the advice, what was right and wrong for them. But yet they were still asking for more and more advice perpetually, and then they would change their decks. Some people would change her decks off of every single piece of advice they got, and then they lost their deck. They lost their story. They lost everything in terms of how to tell it because they're optimizing for that person's feedback or they're optimizing for? I'm pitching investors in L. A. So I got a frame it like this. I'm pitching investors in San Francisco. So now I got a frame it like this.

Let's let's sit on this for a second because I'm getting I'm getting a good amount of the people that asked me for fundraising advice that I don't already know. Well, yeah, they will send me that pitch deck and ask for pitch deck advice about bad times or how to get into white commentator in court. And I'm always I'm always hesitant on what advice to give you because I can. Just the easiest thing for me to do is just stream of consciousness, every single slide. This sucks. This has changed. I'm curious about that. What stands out as you're trying to hide this, But I'm like, how helpful is this? Because I don't get like, What is the That's not how you would edit an article. No. And this comes back to this.

You get 10 different people to give you advice on an article, and they're all all they're looking for is like grammar. And like the style of writing at the end, you're gonna have a piece of shit because nobody looks at what is the core of the story, right? What is the core voice we're tryingto have here? What type of articles? Trying to write? Because one person thinks it should be super. Sure. And the other person thinks it should be a long form. Yeah, they don't like the way you started. You know, like the promise you need to know what is the story of what style you need to have. And then,

yes, you can get advice and work with people. But you need to be careful in general getting conflicting advice for lots and lots of people. But this is the is such a good point that people will get advice from very different people about the pitch that and all of them are completely oblivious to like What are we trying to say, though?

A good context and what you ask for pitch deck feedback? You're not asking for business advice. Oh, yeah. You're asking for essentially this.

But many people would be like I don't think this business small really works on the like. You should do mawr your marketplace. Yeah, and then you tweak it. If you want to be a marketplace office? I was like, Wait,

is that really what you want to do? Is that because you think you're gonna get funding because you do that? Yeah, right. So it's such a good point is probably a big key point, which is, you know, and this is why we created one asset. And that asset is all about fixing the story of the pitched up. And we have a very specific way to do it. And it's much different than the formulaic you need problem, team solution and all that kind of stuff because that stuff doesn't work anymore. And, you know, the funny thing is like when you're building a business when you have customers, uh, are trying to,

like, target them and things like that You're always thinking about your audience or you should be. People don't think about their audience when they're making these pitch sex. I don't think that there these investors, if you would have a formulaic looking pitch, they're gonna get bored. They're gonna ignore it there, and that's at best. At worst. They're going to sit there and turn a bucket you into some bucket that they've seen before and then makes it easy for them to say No, that's the problem. Right off. So? So I think Founders forget because they work day to day in their businesses and they forget how to tell a story on a higher level about why they're doing it and what they're actually like, Why they exist. Why why Why do you even start this business,

right? Cause on investor actually wants to know that, but they don't know how to ask you. So if you talk to the best investors and they see her day when they're into it, they want to get to know you. Now imagine if you let them get to know you and the story of this business in the deck instead of just having this. Formulate this my business plan type deck, right? Which is what we turned into in the market these days. So right and then not now. You're all of a sudden having a team side. No. Why would you have a team side if your team is building the whole thing? Your team has built this great business in the storyline. How it happened, right? So there's a bunch of stuff like that that I think people forget that the audience is used to basically a formulaic pitch. And if you give them a formulate pitch, it actually doesn't help them or you getting the money.

There's a 1,000,000 things I want to say, OK, but that's gonna be another day. So let's let's Is there any other? Let's look at it. It heat. So this is a pockets with traveling for so long? This was the first time in a long while that were actually ableto each other, waiting for that same S o, he said. And trust would be an easy going through his research, honest phone

and looking at the book. Yeah, because we interviewed 50 people and there's no way you can 1000 and that Yeah, right. 50 people. 1000 minutes, two tweets.

And what is that, your elegant for people that want Oh,

no, just Bentley slash funding. Early

access funding, early access. If you're in the middle of raising money, if you need to raise money already

about wanting to raise money any time,

Yes, go there on and make sure to be on the list.

Okay, so this is a good one. There isn't a brilliant source of information for founders on fundraising. There is any angel angel hacks and which is pre Angel is by those folks. But that site hasn't been updated, and they're busy with the platform, not the content of interested in that. Yeah, and that content used to be amazing. Yeah, like like when When I was raising and and I'm sure you were like it was like a go to, but a lot of it's dated now and then. It hasn't been updated, but it's still some definitive stuff in there. Yeah, right. It's great.

And they also went into a lot of areas outside of fundraising, like cap tables and all these things. And also, like what we learned is that those technicalities of financials and cap table's a letter. Actually, not as important as more fundamental things around fundraising, right? If you go out there and look, there's a lot of things around the technicalities of it. When people have fundamental issues with what investors should I go after? How should I pitch them? Who's right for me? How do I know that I'm making progress with investors, so they never set that but underneath it, that's what they're trying to figure out every day, right?

Like they haven't answered back tomorrow. That was a great meeting. You know, every time I heard from it outside of these interviews, I've heard from people that say it was a great meeting. I know you've heard this, and I'm like, Well, hold on what happened in the meeting and my conclusion. She video like that in a whale that that I break it down. It's like soul crushing for them. Right? So that's been fun.

Um, here's the Here's another one. I don't know if it's a yes, the founder. The I find on a minute presentation of this, I'll send it your way one day. Or like the seven deadly fundraising since for movement. And one of it is when you get to weigh partner meeting the expectations founders have when they get toe found partner meeting for the first time at every see firm and the prep they get. And what actually transpires enough on a median. What? The context is that the partners sit down on the these worlds apart, worlds apart. Most founders the first part of me that like this isn't the last formality. They love it. This partner has been working with us for weeks and palm and they walk in and they feel like the partners are informed and excited to see them, and they walk into this and the pot partners sit there. They don't know what the fuck you are.

And one of them is currently buying a house and is on this phone the entire presentation, busy with something else on it is like nothing you expect. There was no friend crowd there, No informed. No nothing

like that. Expectation of knowledge about something is one of the worst things. And then in a partner meeting, it's like, Oh, yeah, I already know. It's like, Yeah, you have a champion that's been excited with you. Yeah, but they have a partnership to get on board. Yeah, right. Often time. Yeah.

Anyways, I don't want to get one, but yeah, a

lot of interviews. We didn't get that far because it wasn't even about, like, the problems around the communications with investors. But that's kind of what that is. It was much more around, like the anxieties around it that that kept coming up. So there was other ones like, uh, everyone wanted advice really badly, but they just wanted to know what to do. And it wasn't even advice like pitch deck advice. It was just like which fighting And we got him in a setting where they were really open to it. Because we're not trying invest in there cos we're not trying to do anything except learn about this. So we've got a lot more open this around that. And it just pulled down to wanting advice Really badly. Was the statement we

kind of concluded on that Doubted insecurity. I wrote an article once, like investors turning founders into little insecure teenagers.

Oh, yeah, You gotta find your articles very great,

but that But that's that's such a big things. Like founders of these, like risk taker, they don't listen to their parents. And don't listen to that boss when they go on to start the thing. But investors are the is this group of people that founders are so intimidated by. That's why I care so much about validation from then. They're like they're walking into this relationship with an energy of like, Do you think I'm pretty damn it, This is what you want me to be blocked. I don't know what to do. And then they run off to their friends. Does he like me? Oh, that's right. And this is such a level of security and Blake and need to please and need to, and it's because there's obviously there's this.

It's money and power, right? So raising millions of dollars for people that I haven't done this it comes with the with they a false and naive sense of like, this means something significant. It means I'm worthy inter companies exceeding it means we have accomplished something. And there's this off powerful people that hold us that can give you this sense of accomplishment that can allow you to be really success to be the next Google Facebook. And it's not

like that is like that at all. Not like they're doing the work. It's your business. Yeah, Now let's finish. I wanted I wanted to tell you the statement we use for that one. Okay, and then we'll go into Temporal. The statement we used is there is a decision making issue. People spend their wheels and waste time because they aren't sure what to do next, and that's across Oh, any kind around any kind of thing. And in relation. What you're saying is like, I don't know what to do. Do they like me? Do they not like It's the same thing and a lot of it's that on basically,

a lot of it has to do with, like, When should I It raised money and my making progress on this process or not all those kind of things. So the the level of uncertainty, I think, is part of the problem. It's worse than the sales process. A lot of people will say, Oh, it's like a sales process We saw a lot of people, uh, try to hit up like 100 investors. There's also a lot of things out there, like Jeff Bezos have to pick 60 investors for his 1st $1,000,000 funding. Great fodder for the stuff we're doing doesn't necessarily have to be like that and just cause Jeff Bezos back in the day I had to do that and now it's Amazon doesn't mean you're related at all. Yeah, right or it doesn't mean a TV, your heart. It just means that like it's

a process. There's so much content. So surrounded. Who were these people? How did he hit them up? Like there's people that sent like, ah, bulk email of 100 most of some random partners at the insert V. C from dot com. You might as well looking through your write letters and throw them in the fucking Pacific oceans like nobody ever sees this thing. So it doesn't matter. You could be 10 million emails you're sending at that, and it doesn't matter. So who are these people? Who was Jeff Bezos where they can hit them? All this matters greatly expressed. And um,

yeah, there's no one size fits all. So okay, so let's finish up the episode. Obviously, there's a lot here. We'll do some more episodes around fundraising. We've done one prior. We'll do some more in the future as a big topic. But what is the out of everything you've learned? 1000 minutes of interviewing founders. If you could only give one tip. Yeah, one thing that pretty universally hitting people. What's that little piece of advice actionable that people

can take away? Investors want to invest in a great business, show them you have a great business that's gonna grow. That's all I got.

It's all you got. God damn, you eaten that simple dude, It's not simple. It's not easy. Can't you just tell me if I write it at the subject? Land the wood that says, you know, quick jab. I've got a great business. You should invest in it. Straight up. Straight up you go. Back it up. All right. You got nothing more to add, right?

Uh, there's nothing about two activists like, If you have a great business, you will be able to raise money, demonstrate that demonstrate that. Tell that

story. And if you don't have one, don't try to raise money because

you're not gonna be able to convince anyone. I'm sorry, but I want to raise money to make my business agree. This is schools

and go get friends and family and get them it. Convinced that get someone convinced that you can make a great business before you

have. All right, You did. Not Even I can make a car argument to this. That makes sense. But I like I don't really want about just just to play somebody else out there that tries to push back on this. Stop wasting your energy and just accept this is such a universal truth. Have a great business that people want to invest

in. That's right. It's not even Hamlet demonstrate make more demonstrating that stand. That's the job we have. That's it from us by.