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AngelPad Session BB 10.6.11

AngelPad Session BB 10.6.11

  1. 1. How to build a traction narrative, pimp your AngelList profile, hustle on AngelList, and understand that fundraising is #&@* hard.<br />@brendanbaker<br />AngelPad – October 6, 2011<br />Brendan Baker<br />
  2. 2. Shiny Ego Stuff<br />*<br /> Not a founder (yet)<br />Brendan Baker<br />
  3. 3. Our options<br />1<br />Building a Traction Story<br />2<br />Pimping Your AngelList Profile<br />3<br />Hustling with AngelList<br />4<br />Fundraising is $%*@ hard<br />Brendan Baker<br />
  4. 4. Building a Traction Story<br />Brendan Baker<br />
  5. 5. 1<br />How do investors think?<br />Brendan Baker<br />
  6. 6. Momentum.<br />Green is good.<br />Brendan Baker<br />
  7. 7. Excitement > Hesitation<br />Amplify and focus on the excitement points. <br />Surface and deal with the hesitation points.<br />Brendan Baker<br />
  8. 8. Derisking.<br />Can they build the product?<br />Will people use it?<br />Risk<br />Will people pay for it?<br />Will people come in mass?<br />Progress<br />Derisking often happens in steps.<br />These steps may vary for different startups.<br />Brendan Baker<br />
  9. 9. Investors respond to a story.<br /> Storyboard. Make the pieces fit together. <br />A story here means the takeaway message you want them to have, not something you’ll say directly.<br />Brendan Baker<br />
  10. 10. 2<br />What is traction?<br />Brendan Baker<br />
  11. 11. Traction is yourstory of momentum, told through quantified evidence of market demand for your product.<br />Brendan Baker<br />
  12. 12. “your story”<br />Not told directly, but implied in examples of evidence.<br />Your traction is unique – use examples that are unique.<br />Don’t hide weaknesses, but frame them.<br />Brendan Baker<br />
  13. 13. “quantified evidence”<br />Yes<br />Maybe<br />Profits<br />Revenues<br />Active users<br />Engagement<br />Customers/clients<br />Registered Users<br />Downloads<br />Partnerships<br />Traffic<br />Cohort progress<br />Engagement progress<br />Product velocity<br />No<br />Press<br />Testimonials<br />* This isn’t a set list. Use evidence that makes sense for you. <br />Brendan Baker<br />
  14. 14. “Market demand”<br />Dynamic > static.<br />Use evidence that describes momentum, and hints at market potential.<br />Graphs or growth numbers can work.<br />Brendan Baker<br />
  15. 15. 3<br />So the traction story should show the path from product to market.<br />Brendan Baker<br />
  16. 16. Some examples<br />Brendan Baker<br />
  17. 17. Remember:<br />The story is the implied message you want to send. It’s not something you’ll say directly. <br /> Think of it this way: say you pitched an Associate at a VC firm. She liked you, and had a minute to describe your status and progress to a Partner. What would you want her to say?<br /> That’s your target story. Tell it with traction.<br />Brendan Baker<br />
  18. 18. story<br />“They’re super early, but theybuild and learn fast. They’re worth betting on.”<br />traction<br />Brendan Baker<br />
  19. 19. story<br />“They’re creating a marketplace. That’s hard, but theyknow it. Theyknew theyhad to build the supply side first, and theynailed it. Now they’re tackling the demand side. Early indications are good, and I think they know how to ramp it up.”<br />traction<br />Launched in March 2011:<br /><ul><li>25,000 vendors, with avg 25 items (growing 20-30%/month)
  20. 20. 11K uniques (growing 40%/month), with 3% conversion
  21. 21. avg purchase of $45 (growing 5%/month)
  22. 22. $120,000 revenue run rate (increasing 30%/month)
  23. 23. Just signed partnership with Yahoo! And ramping up ads.</li></ul>Brendan Baker<br />
  24. 24. story<br />“They’re accelerating theirschool by school rollout. The first schools are showing faster adoption than Facebook at their start, and are already nearing local market saturation. They’ve started in the next set of schools, and adoption and engagement is even higher. They’re releasing faster than anyone I’ve ever seen, and it’s working.”<br />traction<br />Launched 2 months ago in first school:<br /><ul><li>Downloaded by 80% of addressable population
  25. 25. Weekly actives: 55%
  26. 26. Feature requests: course sets, note sharing, daily deals  V2</li></ul>With V2, now ramping to 10 more schools in 3 months:<br /><ul><li>3 launched to date
  27. 27. Each school population is downloading the app at a 15% faster rate
  28. 28. Engagement (photos shared, messages, etc) has increased 40%+ over V1</li></ul>Currently building V3 with virality features, and planning to build street teams to reach the next 25 schools.<br />Brendan Baker<br />
  29. 29. Pimping your AngelList Profile.<br />Brendan Baker<br />
  30. 30. 1<br />Your job is to capture their attention.<br /> Don’t tell your life story. Focus on memorable highlights.<br />Brendan Baker<br />
  31. 31. 2<br />You’re in a market for early stage funding.<br />Be unique. <br />Don’t take is personally. <br />Nobody cares about your problems.<br />Brendan Baker<br />
  32. 32. 3<br />The best info, as concisely as possible.<br />Be focused. <br />Second draft = first draft – 25%. <br />Third draft = second draft – 25%.<br />Brendan Baker<br />
  33. 33. 4<br />80/20: 80% what you’ve done, 20% where you’re going.<br />Investors will extrapolate your past success to predict your future progress. This is different in other pitching contexts.<br />Brendan Baker<br />
  34. 34. 5<br />Evidence trumps potential.<br />Every time you call yourself a ‘visionary,’ a puppy dies. You’re not a gamechanger, seasoned professional, innovative, next generation, or any other overused catchphrase.<br />Brendan Baker<br />
  35. 35. 6<br />Conviction convinces.<br />Use present tense and strong wording. <br />Avoid weak shit like ‘we’re planning to…’<br />Brendan Baker<br />
  36. 36. 7<br />Associate yourself with success.<br />Capture the gold dust from your investors, past employers or startups, customers, etc.<br />
  37. 37. 8<br />ASM: Always Show Momentum.<br />Venture investors invest in momentum. <br />Set expectations: ‘we’re still in private beta but…’ <br />Use absolute and growth numbers.<br />Brendan Baker<br />
  38. 38. 9<br />Geeks rule.<br />AngelList is a technical community. Broadcast your geeks.<br />Brendan Baker<br />
  39. 39. 10<br />Give them something to touch right away.<br />Provide a demo with login details or failing that, screenshots. Don’t rely on a 2 minute demo video. Busy investors won’t watch it.<br />Brendan Baker<br />
  40. 40. How to Hustle on AngelList<br />Quick discussion around the ‘How to Hustle with AngelList in 12 Steps’ Quora post.<br />Brendan Baker<br />
  41. 41. Fundraising is $#@* Hard.<br />Quick discussion around Anatomy of Seed project.<br />Brendan Baker<br />
  42. 42. Resources<br />How to Communicate Traction to Investors<br />How to Hustle with AngelList in 10 Steps<br />Anatomy of Seed: An Inside Look at a $1M Seed Round<br />Brendan Baker<br />
  43. 43. Thank you. <br />Thank you for building kick-ass companies.<br />@brendanbaker<br />Brendan Baker<br />

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