April 18, 2022
20 Years in VC, unlocking growth and supporting startups, by Tae Hea Nahm
Tae Hea Nahm, Managing Director and Co-Founder at Storm Ventures in this episode talks about his experience working as an attorney and helping startup founders raise money for their companies, and eventually starting a VC fund of his own. We also spoke about his book "Survival To Thrival", why he wrote it and what was the affect on his fund.
Tae's LinkedIn: https://www.linkedin.com/in/tnahm/
Storm ventures: https://www.stormventures.com/
Here is the list of podcasts about fundraising (some of them are non-profit fundraisings but still) - https://blog.feedspot.com/fundraising_podcasts/
Transcript
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They're releasing to fundraising
video a podcast about
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fundraising for early-stage
startups, the major rule that we
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follow here is no bullshit on
this podcast.
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No music to relax, you know,
advertisements of our sponsors.
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We only talk about fundraising
here and nothing else.
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So let's jump into the episode.
And today's guest speaker, we
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have tee hee Nam managing
director and co-founder and
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storm Ventures table.
Was the VC for over 20 years and
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this episode, we'll talk about
how storm Ventress has invested
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in over 220 B2B software
companies.
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How do they choose those?
How do those become unicorns?
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And Ward are some of the secrets
to success.
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And, of course, we're going to
touch on to the book that they
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can on roads survival to thrival
and this guy's major to
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concerns.
That's old Founders have one
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being fired as a CEO of their
own company and to achieve This
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growth and unlocking the growth.
So did he?
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Let's kick it off by you giving
us some background on yourself
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and on storm Ventures, great.
Well, first of all Constantine,
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really appreciate the
opportunity to be part of your
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podcast and the community that
you're building.
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So appreciate that quick
background about myself is, I
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was born in Korea, we immigrated
to United States.
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When I was five years old,
didn't have much, say in the
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matter, I just sort of tagged
along.
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And then I was an applied.
Math major in college.
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So I like modeling and looking
for patterns of success and
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failure.
I actually then wanted to become
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a programmer, go get an MBA, but
my parents want me to go md-phd
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and so we compromised on another
professional degree law school.
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And so, then I went to law
school and after graduation,
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I've been out here in Silicon
Valley, working with tech
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startups.
Nice perks of having siblings
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right there.
My brother dropped out of you
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silly.
So my parents just one needs to
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actually graduate school or
special?
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Fortunately, I'm the second son.
Oh let's just say my older
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brother.
He's a medical school.
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Professor fam right there.
See that's someone's got to be
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different.
There is in defense of my
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brother.
I'm going to say that he is a
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software developer.
Working for Facebook.
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So he's doing just fine without
that degree.
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But enough of my siblings for
let's talk about the, your
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background and specifically the
fact that you were in Germany
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and you have actually helped
tons and tons of companies for
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raise money, while you were in
the legal field.
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So can you tell us a little bit
more about that?
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A lot of Founders actually reach
out to me asking it.
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Can I find attorneys who instead
of charging me cash will work
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for equity?
Right.
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So, you know, after graduation,
I really wanted to work with
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startups and so I came out to
Silicon Valley and started
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working at Wilson sonsini and
made partner there.
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And at Wilson just work with a
lot of startups.
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And because that's the reason
why I came and it was a lot of
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fun.
You know, just meeting different
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Founders and sort of helping
them and their startup Journey
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such as incorporating them, I'll
tell you a story.
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You know, when I started as an
attorney, I felt like I Was like
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perfectly set for to work with
high-tech startups, because, you
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know, I was studied applied math
or Harvard, knew a lot about
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tech and then, you know, I
studied a lot of corporate other
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law as Chicago.
So I thought I was like, so
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prepared came to Wilson to work
with startups and I was 25 years
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old, but I look like I was 16
and I was meeting this founder
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and the founder asked me.
This question.
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I was so prepared.
I thought asked me this
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question.
You need ink in the company name
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and despite all my hours of
studying, I never looked into
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the company name and so I had
this deer in the headlights look
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and so the founders thought I
was clueless.
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Okay.
But anyway I spent the next two
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days researching this question.
So I was prepared for the next
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founder that I saw so they of
course and every founder ask
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about their name, right?
So they asked and I had like
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researched it so I gave the
right answer.
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Sir and then they decide to go
with ink in their name.
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And then the next question they
ask me is do they need a comma
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before ink and I'm thinking,
man.
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I just spent days researching
but didn't, you know, research,
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whether you need a comma or not.
So you know but anyway that was
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like my introduction working
with startups and the beauty
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was, you know, just work with a
lot of companies.
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I worked with over 200 startups
and just sort of got an
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understanding of the startup
Journey because 90% of the
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Journey of similar for a lot of
these startups, whether they're
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biotech medical device, you
know, internet or semis,
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definitely, they all have very
similar starts and the strategy
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there are can be very much
repetitive, but ironically know
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if I work for a company that
does in corporations for
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startups.
And you know what, I'm not even
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sure if I think is required.
I don't believe so.
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I think you can.
There it is.
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Ali required, but it makes it
easier when your qualifying to
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do business in other states and
so forth.
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And this would but this was seen
a long time ago, you know, to be
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honest Constantine I have not
researched this question
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recently.
Well, it's everything.
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So this podcast it's not illegal
affront entually, why?
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So people so I'm sure not sure
but this check it out there's
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Google now.
So you can just go on your
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phone.
Go on your computer and double
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check.
What were telling you here, put
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enough of the illegal.
Hope, let's talk about your
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investments from Storm.
Ventures on our printer, you
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call, you have mentioned that
you've invested in roughly 220.
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B2B software companies and out
of them thirteen became the
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Unicorn.
So question is, what is the key
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to success?
There were those certain
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companies doing something, some
particular patterns, some, you
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know, strategy that is just,
they were replicating the
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strategies that have worked for
other companies.
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Or were they all beating cases?
Yeah.
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So I mean these are companies
ranging from like Marketo to
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more recent companies.
Like I'll go, Leah, work Auto
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Talk desk and whether us
companies marketing workout, or
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us companies are like Solaris
bank or a pipe drive out of
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Europe.
I think there's really the
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commonality of unicorns and B2B
software is simple as that.
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You just need to be a high
growth company with good unit
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economics.
With good business model.
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And if you have that then
everyone's excited about you.
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So another way of looking at it
as I look at it is that we're
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looking for companies that can
serve a big wave.
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The bigger the wave the bigger
the company can be and surfing
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means that you know you're
growing effortlessly to be the
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leader and so as an early stage
to investor, what we look for is
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a wave early on That we think
can be a big wave.
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Hmm.
And second is a CEO that we
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think that can surf the wave,
right?
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So if when those two things
happen, good things happen to
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everyone else, right?
That does make quite a bit of
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sense.
So let's, let's talk about that
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wave surfing.
How do you identify those?
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So a lot of Founders starts
companies in probably newly
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created markets, work, margins
that don't even exist yet and
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how can they be?
The ones, you know, how can they
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check if that's a real wave or
it has the potential of becoming
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a real wave or it's just, you
know, if Luke something that's
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kind of seems reasonable, but in
reality, it has very little
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chance of even being funded by
VCS who like to risk.
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So, that's a great question
about, you know, identifying
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something that early on that is
small but looks like it could be
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a Big way and I would say that
in our investments it's been
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rare that we've been wrong about
the wig.
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And I think that's okay with
Founders in general, as they
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really look at it.
The problem is, it's not the
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way, but the timing, you know,
you could be off.
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In other words, that either
being too early or do you know,
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if you're too late as a
start-up?
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It's almost impossible to catch
the wave.
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And then if you're too early,
It's really important to make
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sure you're still surviving when
the wave comes and hits you.
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So the challenge is to just get
the timing, right?
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And an example that it's like
metal burps, you know, we're all
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talking about metaverse, going
to be something big.
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I mean, Facebook, even changed
their name accordingly.
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And I think everyone will
probably think that, you know,
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that has a potential of being a
huge wave, but the question is
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one, the question is when I
mean, I hope that Facebook has a
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resources to survive that even
the other a little bit too early
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because otherwise My Brother's
Keeper is questionable.
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I think they have the resources
and the conviction or they do.
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Yes.
So it's like you got to get the
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timing right?
And the next thing I have to do
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is you have to catch that wave,
right?
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So let's let's talk about cash
in that wave and we're going to
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jump a little bit forward and
then go back to talk a little
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bit more about your background
and specifically you as we
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starting your own company and
selling it.
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Julie, but let's talk about
catching that wafer.
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So in the book that you have
mentioned in our print recall,
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survival to thrival, the one
that you've created, one of the
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subjects that you were talking
about.
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If I remember correctly, is the
growth part, right?
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How do you start making those
initial sales where do you
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start?
So, can you give some advice to
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release?
Each Founders who are listening
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to this right now?
Who maybe have some kind of
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product?
Something resembling, the final
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product, something that kind of
works.
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How do they start making sales?
How do they pick the interest of
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the buyers in something?
That's not probably fully
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finished yet, right?
So let me step back.
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And when we call this phase, the
companies in is unlocking
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growth.
Because first of all, when you
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want to talk about something is
always good to have a name.
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And so it's about unlocking
growth.
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And what that is is what
requires is a transition from
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founder.
Let sales were Have a founder or
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co-founders that are very good
at going out and getting
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customers by himself or herself
because, you know, they have the
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passion, they have the vision
and so forth, so they can close
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so many times.
What, what's important unlocking
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growth is going from this
transition from founder, like
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growth to some repeatable,
scalable go-to-market that mere
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mortals can do.
In other words, you know, you
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don't have to hire a clown of
the Der, you can just hire any
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normal person and then they
become immediately productive as
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a sales person or as a marketing
person or product person.
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So you don't have to hire
unicorns, and if you can do
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that, then you can start scaling
and we call that finding
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go-to-market fit that.
Repeatable, scalable predictable
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go-to-market process and so this
turns out to be the most
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important value creation, Part
of a start-up is when you go
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from the beginning, where your
founding, the company trying to
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get some customers with by,
finding product-market fit to
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later on when you're trying to
become the leader in your
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category.
And so this transition we call
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unlocking growth and it's it
turns out to be so critical.
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It's the key value inflection
point of a start-up and within
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unlocking grope, you know, we've
Come up with a process that
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works.
It's like a recipe that works
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for our companies that that we
share as well, right?
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So we'll probably touch on to
that recipe a little bit later
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on when we go a little bit more
into depth of what the book is
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about and what you cover there.
And also there's me case study
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at the end, just to quick peek
into what's going to come.
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But now, question about the
company that you have started
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yourself and you have
successfully sold it to Kenny,
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Also more about that company and
what was it about and how did
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00:12:59,800 --> 00:13:02,600
you eventually unlock the growth
for that company yourself?
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Sure.
So this company was airspace and
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it was in the early company, one
of the first in Enterprise
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Wi-Fi.
So the way we were thinking was
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that wife, I was going to become
ubiquitous in the Enterprise and
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so if it becomes ubiquitous then
you need something to connect
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it.
All right?
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So you need something that
connected, you need something to
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manage it and something too.
Make it secure and that would be
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the Enterprise Wi-Fi back back
in.
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You know, and as you know, Wi-Fi
now it comes with every laptop
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comes with every smartphone and
so forth.
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But this is before, Wi-Fi was
ubiquitous, you know, that was
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the way.
So felt like Wi-Fi devices are
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going to become.
Ubiquitous it will become
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standard and Enterprises and the
so Enterprises will need this
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solution.
Okay.
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And then did he?
She never correct.
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So we were developing the right,
right?
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So that was the way and we sort
of timed it, right?
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And then but we weren't the only
ones there were some other
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competitors.
Well to and question them become
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is then you know, how do we
catch that wave to become?
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You know the lead Surfer.
Yeah, versus just wiping out
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right right.
And and so in our case, We
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really thought about the the go
to market, and the key to our
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go-to-market is that we felt
that our biggest competitor at
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the time would be Cisco because
this goes number one, networking
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equipment, provider at that
time.
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And so we then replicated a
go-to-market strategy that some
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of the other companies that use
successfully gained Cisco, which
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is to sign up Partners.
So, we signed up a And your
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partner's which helped
accelerate the company from 0 to
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100 million in Revenue in just a
few days.
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00:15:01,600 --> 00:15:03,500
And when you're saying Partners,
you mean the field Partners,
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right?
Companies like seeing like
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Alcatel, NEC and others that
have, they were selling
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networking equipment at the
time, but what their customers
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needed, this is sort of Wi-Fi
solution, gotcha.
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So all right, it looked at this
and say, Meet Leo.
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We got to keep our existing
customers happy.
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And so you know, we want to
resell this airspace stuff
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because the alternative is that
the customer may go to Sisko.
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Yeah and Cersei will buy Wi-Fi
from you and then Cisco will use
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that as the wedge to.
Then knockout incumbent?
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00:15:45,100 --> 00:15:48,000
Yes, that is absolutely great
tragic.
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00:15:48,000 --> 00:15:50,800
Great strategy right there.
Perfect love to hear that.
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And how did you get to the exit?
Was they exit like So we sold it
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00:15:55,600 --> 00:15:59,900
for 450 million to actually says
is okay, and that's because it's
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just do realize that they have
the old architecture.
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We had the new architecture and
as a result, you know, we were
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beating them and do.
Nice, congrats.
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00:16:09,700 --> 00:16:13,700
That's was that the initial plan
for you, were you looking at
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Cisco as your potential future
acquirer or no, we're not
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really, we're focused on just
building the company and the
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opportunity just came at that
time.
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00:16:24,200 --> 00:16:26,200
Fair enough.
But I think, you know, I just
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bring that up as a metaphor of,
you know, we'd serve identified
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the wave, we caught the wave and
a key part of catching.
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The wave is really how to unlock
growth.
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00:16:36,600 --> 00:16:39,700
And then, you know, once were
able to unlock growth and become
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a high Growth Company than
everyone wants to invest in you
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00:16:43,600 --> 00:16:46,900
and join you and so forth.
And so at that point fundraising
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00:16:46,900 --> 00:16:49,200
is not an issue, it's an issue
to write.
287
00:16:49,400 --> 00:16:52,700
Make sure that you don't spend
too much time on that and
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00:16:52,700 --> 00:16:55,000
actually focus on building the
company itself.
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00:16:55,500 --> 00:16:58,500
So on this note, let's let's
actually go back to talking
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00:16:58,500 --> 00:17:01,100
about storm dangers and what
you're doing with that fund.
291
00:17:01,100 --> 00:17:04,200
So, first things first, let's
touch on to the book that you
292
00:17:04,200 --> 00:17:07,599
wrote survival to thrival.
I know that writing a book is
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00:17:07,599 --> 00:17:11,000
going to take ages for me.
Personally, we were developing a
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00:17:11,000 --> 00:17:13,700
course about fundraising for
early-stage startups, and it
295
00:17:13,708 --> 00:17:18,099
took us roughly what six months
while doing it kind of part time
296
00:17:18,099 --> 00:17:22,500
after work after the podcast.
So it took us ages to write just
297
00:17:22,500 --> 00:17:26,000
the course and the book I would
Agent seeks way, way more effort
298
00:17:26,000 --> 00:17:28,500
than that.
So, first question, why you
299
00:17:28,500 --> 00:17:31,600
decide to write that book at?
What was the driving force for
300
00:17:31,600 --> 00:17:32,900
you?
Why did you choose that?
301
00:17:32,900 --> 00:17:34,800
You know, it's a wise time
investment for you.
302
00:17:37,700 --> 00:17:40,700
A key reason, why?
My co-author Bob tanker, he and
303
00:17:40,700 --> 00:17:44,900
I decided to go on this journey
as one as we thought it wouldn't
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00:17:44,900 --> 00:17:47,600
be too much work.
Okay, wrong with that.
305
00:17:47,600 --> 00:17:52,200
But that was our expertly
assumption and then second is,
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00:17:53,300 --> 00:17:57,100
you know, So many people have
helped us in our careers and
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00:17:57,100 --> 00:17:59,200
work.
And then the next generation was
308
00:17:59,200 --> 00:18:03,500
coming to us with questions that
we thought we can just simply
309
00:18:03,500 --> 00:18:06,500
write it down and share it in a
very systematic.
310
00:18:06,500 --> 00:18:10,500
Easy manner should all right.
That's that's very nice, giving
311
00:18:10,500 --> 00:18:13,500
back, that's definitely.
So that was the idea is sort of
312
00:18:13,500 --> 00:18:15,500
paying back.
What people have given us.
313
00:18:15,500 --> 00:18:19,000
Yeah, fair enough.
Fair enough, definitely not idea
314
00:18:19,000 --> 00:18:21,300
for us.
We're too poor to give back at
315
00:18:21,300 --> 00:18:24,000
this point but definitely good
drive.
316
00:18:24,100 --> 00:18:26,200
Force and how long did it take
you to write that book?
317
00:18:26,200 --> 00:18:29,300
I'm just curious at this point.
It's ended up taking us for
318
00:18:29,300 --> 00:18:30,700
years for years.
Bam.
319
00:18:30,800 --> 00:18:33,800
That's what I thought.
Yeah, I thought we were going to
320
00:18:33,808 --> 00:18:38,500
be finishing our course in
roughly 23 months because I
321
00:18:38,508 --> 00:18:41,800
mean, it's just a course about
part of fundraising, nope, six
322
00:18:41,800 --> 00:18:45,500
months right there.
So, yeah, mistakes were made on
323
00:18:45,500 --> 00:18:48,100
our side as well.
So, let's talk about the
324
00:18:48,100 --> 00:18:50,400
contents of the book and
specifically, one of the
325
00:18:50,400 --> 00:18:53,000
concerns that you cover in the
book or one of the concerns of
326
00:18:53,000 --> 00:18:56,500
the founders that You cover in
the book which is getting fired
327
00:18:56,500 --> 00:18:58,700
from your own company.
Can you tell us a little more
328
00:18:58,700 --> 00:19:01,300
about that?
How does that work and how did
329
00:19:01,300 --> 00:19:03,000
you address that concern in your
book?
330
00:19:04,300 --> 00:19:06,800
Yeah.
So you know as an attorney I
331
00:19:06,808 --> 00:19:10,800
worked with hundreds of startups
and as a start-up attorney, many
332
00:19:10,800 --> 00:19:14,400
questions times I get pulled in
because there's a board fight
333
00:19:14,400 --> 00:19:17,300
about who to see Hill is and so
forth.
334
00:19:17,900 --> 00:19:21,300
So I got to experience that
first as an attorney and then
335
00:19:21,300 --> 00:19:25,100
later on as a VC board member,
you know, you Involved in this,
336
00:19:25,900 --> 00:19:30,200
you know, just went through a
lot of executive changes
337
00:19:30,200 --> 00:19:35,100
unfortunately and as one
thorough at what we realized is
338
00:19:35,100 --> 00:19:40,200
that many times, it's less about
the person or the personality,
339
00:19:40,200 --> 00:19:46,200
but more about the situation and
there are situations where a
340
00:19:46,200 --> 00:19:50,900
person who's a superstar today
can really be struggling
341
00:19:50,900 --> 00:19:53,900
tomorrow.
Yeah, it's the same person.
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00:19:54,000 --> 00:19:57,000
It's not like the person gave
up, you know, the person is
343
00:19:57,000 --> 00:20:00,400
passionate as ever and so forth
but you know, there's many
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00:20:00,400 --> 00:20:05,500
situations like that.
And so what we wanted to do was
345
00:20:05,500 --> 00:20:10,200
to explain why that happened and
how a person can avoid that.
346
00:20:11,000 --> 00:20:14,600
And, and so that led us to sort
of write, the Books is to help
347
00:20:14,600 --> 00:20:17,300
people anticipate how your job
is changing.
348
00:20:18,300 --> 00:20:22,100
So you can anticipate the future
and at the same time, help you
349
00:20:22,100 --> 00:20:26,900
unlearn something.
That made you the superstar that
350
00:20:26,900 --> 00:20:31,700
you were.
And so this way you can
351
00:20:31,700 --> 00:20:36,000
anticipate and unlearn and as a
result go from being a superstar
352
00:20:36,000 --> 00:20:38,600
to the Super Start, the next
stage of the company.
353
00:20:38,900 --> 00:20:45,700
So that was the our thesis and
and with that ended up writing
354
00:20:46,000 --> 00:20:47,700
two books.
Thanks.
355
00:20:47,800 --> 00:20:50,300
Wait, you said to boobs?
Yes.
356
00:20:50,400 --> 00:20:54,400
Because I think to explain to
people Ernie.
357
00:20:54,800 --> 00:20:56,800
We had to explain the company
Journey.
358
00:20:57,400 --> 00:21:03,700
What I mean by that is that take
a VP of sales, a VP of sales at
359
00:21:03,700 --> 00:21:07,000
the beginning of a company you
know where you only have sale.
360
00:21:07,000 --> 00:21:12,100
13 sales reps is very different
than a VP of sales.
361
00:21:12,100 --> 00:21:16,000
That has, let's say, like, 50
sales reps, which is different
362
00:21:16,000 --> 00:21:19,900
than if you have a VP of sales,
in charge of 1000 sales Rose, it
363
00:21:19,900 --> 00:21:22,800
could be the same title VP of
sales, you can say, is doing the
364
00:21:22,800 --> 00:21:25,900
same thing.
The role is quite different and
365
00:21:25,900 --> 00:21:28,300
that's because the companies at
different stages.
366
00:21:28,300 --> 00:21:33,700
So what we wanted to do was to
explain the company journey, and
367
00:21:33,700 --> 00:21:36,800
then saying, because of the
company Journey, there's a
368
00:21:36,800 --> 00:21:41,700
people Journey on top, which is
how each role changes whether
369
00:21:41,700 --> 00:21:47,100
you're the CEO, the VP of sales,
the CFO or Board number how your
370
00:21:47,100 --> 00:21:51,500
role is going to change as the
company changes and as a result
371
00:21:51,500 --> 00:21:54,000
you know you as an individual
have to change.
372
00:21:54,000 --> 00:21:56,600
Change or you will be changed,
right?
373
00:21:56,900 --> 00:21:59,200
That's that pretty much sums it
up.
374
00:21:59,200 --> 00:22:01,400
And by the way, because I'm
trying to just sort of, explain
375
00:22:01,400 --> 00:22:05,900
it in the manner, which is not
personal, you know, right.
376
00:22:05,900 --> 00:22:10,000
For people who are curious about
how those changes might happen,
377
00:22:10,000 --> 00:22:14,200
specifically, and y-yes, legal
side of it, especially we've
378
00:22:14,200 --> 00:22:17,800
actually just made interview
with the founder of a company
379
00:22:17,800 --> 00:22:21,000
that's focused specifically on
the governing board management.
380
00:22:21,500 --> 00:22:25,600
So if you're curious about how
this Governing boards work, how
381
00:22:25,600 --> 00:22:28,600
you get people on there, how do
you make sure that your
382
00:22:28,600 --> 00:22:32,000
governing board does not fire
you once the company changes.
383
00:22:32,400 --> 00:22:33,700
Definitely check out that
episode.
384
00:22:33,700 --> 00:22:36,600
It's cold.
Governing boards explained very
385
00:22:36,600 --> 00:22:37,600
straightforward.
So check.
386
00:22:37,600 --> 00:22:40,200
Yeah.
That's that is so important to
387
00:22:40,300 --> 00:22:43,300
100% understand the role of the
board.
388
00:22:43,400 --> 00:22:47,500
Yeah, it's personally had very
little idea of how that actually
389
00:22:47,500 --> 00:22:49,100
works.
So dab, so could be super
390
00:22:49,100 --> 00:22:52,700
helpful for anyone who is or
used to be at the same stage as
391
00:22:52,700 --> 00:22:55,400
I was at the moment of recording
of that interview.
392
00:22:55,800 --> 00:23:00,000
So on this note, let's go and
talk a little bit about the the
393
00:23:00,000 --> 00:23:02,300
thing that you mentioned on our
pre-interview call, which is the
394
00:23:02,308 --> 00:23:05,600
fact that you've done a workshop
for Korean University, both
395
00:23:05,600 --> 00:23:07,900
starting specifically data,
science companies.
396
00:23:07,900 --> 00:23:12,600
And on that Workshop, you have
covered two key things that had
397
00:23:12,600 --> 00:23:15,900
to be done in order to launch
that company towards the
398
00:23:15,900 --> 00:23:17,600
success.
Could you explain those two
399
00:23:17,600 --> 00:23:19,700
things?
So, that's sure everyone can
400
00:23:20,000 --> 00:23:24,900
understand them, right?
So we worked on To sort of I
401
00:23:24,908 --> 00:23:32,400
thought would be a high return
things for them one.
402
00:23:32,400 --> 00:23:38,700
And that is one is to make a 5
minute pitch on getting your
403
00:23:38,700 --> 00:23:42,100
first to your first customer on
why they should be your customer
404
00:23:43,400 --> 00:23:49,400
and the second is to do another
five minute pitch on to up to
405
00:23:49,400 --> 00:23:55,600
your first investor.
So, the whole idea here was to
406
00:23:55,600 --> 00:24:01,800
do very short presentations, to
help get your first customer and
407
00:24:01,800 --> 00:24:06,600
to get your first investor,
because if you do that, then you
408
00:24:06,600 --> 00:24:08,800
sort of can get your company off
the ground.
409
00:24:11,000 --> 00:24:14,100
Absolutely.
And that is applicable to every
410
00:24:14,100 --> 00:24:14,800
single company.
Correct?
411
00:24:14,800 --> 00:24:19,200
Especially, you know, in the
data science, B2B world for
412
00:24:19,200 --> 00:24:19,900
sure.
Right.
413
00:24:20,100 --> 00:24:23,100
B to C is a little bit different
because you know, it's not like
414
00:24:23,100 --> 00:24:26,500
yeah, it's sell a customer but
in B2B.
415
00:24:26,500 --> 00:24:29,600
Yes, you have to get your first
customer and you have to get
416
00:24:29,600 --> 00:24:31,100
your first investor.
Hmm.
417
00:24:31,400 --> 00:24:34,200
Absolutely.
That is, there is definitely
418
00:24:34,200 --> 00:24:35,600
huge difference between B2B and
b2c.
419
00:24:35,600 --> 00:24:38,600
So let's focus on to be to be
for this one.
420
00:24:38,600 --> 00:24:43,100
And question is what needs to
Done in order to picture, very
421
00:24:43,100 --> 00:24:45,300
first customer, where should you
start?
422
00:24:45,300 --> 00:24:49,200
Especially again, if your
product is unfinished, where do
423
00:24:49,200 --> 00:24:52,400
you start that pitch?
Yeah.
424
00:24:52,400 --> 00:24:58,400
So the first thing is to
understand understand the
425
00:24:58,400 --> 00:25:02,100
mindset of that B2B customer.
I think that's the most
426
00:25:02,100 --> 00:25:05,200
important thing is that you have
to understand that person's mind
427
00:25:05,200 --> 00:25:12,300
set and I have a view of the B2B
customer As someone who's
428
00:25:12,600 --> 00:25:20,500
relatively smart but is lazy,
you know, and wants to look good
429
00:25:20,500 --> 00:25:23,300
for his or her boss.
Okay.
430
00:25:23,400 --> 00:25:27,300
Is this simple as that?
So what does that mean?
431
00:25:27,300 --> 00:25:33,700
It means that if you don't come
with a product that addresses an
432
00:25:33,800 --> 00:25:40,900
urgent pain then laziness takes
over and this like yeah, this
433
00:25:40,900 --> 00:25:43,200
could be great.
But maybe I'll look at a six
434
00:25:43,200 --> 00:25:47,100
months from now, a year from now
and then you come back in six
435
00:25:47,100 --> 00:25:49,900
months and it's like, oh I'll
look at it six months from now
436
00:25:49,900 --> 00:25:54,300
and so forth.
So the First thing is, you know,
437
00:25:54,600 --> 00:25:57,800
it has to address an urgent
thing.
438
00:25:58,100 --> 00:26:01,900
Hmm, absolutely 100%.
That's the major requirement for
439
00:26:01,900 --> 00:26:05,600
building any solution to a
problem, if it's not an erosion
440
00:26:05,600 --> 00:26:09,400
problem, don't even bother the
chances of you making it far,
441
00:26:09,400 --> 00:26:12,000
far too low.
People are just going to say,
442
00:26:12,100 --> 00:26:15,100
we'll check it out.
Six months later, and that's
443
00:26:15,100 --> 00:26:18,400
just the same thing as saying.
No, but in a, you know, bad way.
444
00:26:18,800 --> 00:26:20,600
Yes.
So it's like answering the
445
00:26:20,600 --> 00:26:21,400
question.
Why?
446
00:26:21,400 --> 00:26:24,000
By now?
Yeah, exactly, exactly,
447
00:26:24,000 --> 00:26:27,300
definitely have to answer that
if you cannot answer that, you
448
00:26:27,300 --> 00:26:31,200
probably have to restructure
your offering quite a bit or the
449
00:26:31,200 --> 00:26:34,000
product itself.
So on this note, let's move on
450
00:26:34,000 --> 00:26:36,600
to the very last question.
It is a call to action.
451
00:26:36,600 --> 00:26:40,500
So he would you want to listen
to as soon as this episode is
452
00:26:40,500 --> 00:26:45,700
over.
You know, we have a website
453
00:26:45,700 --> 00:26:48,600
survival thrival.com and so if
people are interested they
454
00:26:48,600 --> 00:26:52,700
should just go on the website
and we actually have a four step
455
00:26:52,700 --> 00:26:56,300
recipe for unlocking growth that
we provide for free on the
456
00:26:56,300 --> 00:26:58,300
website.
It's about 100 Pages.
457
00:26:58,600 --> 00:27:02,200
Actually, we have to rewrite it
to make it more readable but 100
458
00:27:02,200 --> 00:27:06,700
pages in terms of how to unlock
growth and we've seen this
459
00:27:06,700 --> 00:27:09,300
recipe work.
Well, with our companies, all
460
00:27:09,300 --> 00:27:10,300
right.
That is great.
461
00:27:10,300 --> 00:27:12,600
All day for make sure to leave
Link in the description to the
462
00:27:12,600 --> 00:27:15,800
episodes and one more thing
before I forgot to ask.
463
00:27:16,100 --> 00:27:19,000
Could you briefly explain what
sort of interested in investing
464
00:27:19,000 --> 00:27:22,800
in terms of stage fields and
ever check size.
465
00:27:23,200 --> 00:27:28,000
So that the rice into this
storm, we focus on early stage.
466
00:27:28,000 --> 00:27:32,000
B2B software companies will be
some companies that we invest,
467
00:27:32,000 --> 00:27:34,800
which are pre-revenue.
But that's typically where we
468
00:27:34,800 --> 00:27:38,400
know the founders or one of the
founders, or really like the
469
00:27:38,400 --> 00:27:41,800
space.
Most of the time we best when a
470
00:27:41,800 --> 00:27:44,800
company has about a half a
million to about a million and
471
00:27:44,900 --> 00:27:47,900
annual recurring Revenue.
So basically they have some
472
00:27:47,900 --> 00:27:50,300
happy customers.
So we feel like they have
473
00:27:50,300 --> 00:27:53,900
product Market fit and then we
can, then we feel this is a
474
00:27:53,908 --> 00:27:56,400
company we can work with to
unlock growth.
475
00:27:57,100 --> 00:28:01,900
So if a company has sort of
product Market fit and we feel
476
00:28:01,900 --> 00:28:04,800
we can help them with go to
market, fit to unlock growth and
477
00:28:04,800 --> 00:28:06,700
that's like the ideal company
for us.
478
00:28:07,100 --> 00:28:10,900
Our initial check size is
between 3 to 6 million.
479
00:28:11,400 --> 00:28:14,200
Then we'll invest more and
follow on investments, but we've
480
00:28:14,200 --> 00:28:17,000
done seeds at a million or less
as well too.
481
00:28:18,400 --> 00:28:21,300
And then, as we work with a
company and help them unlock
482
00:28:21,300 --> 00:28:24,200
growth, by finding go to
markets, fit to go from that
483
00:28:24,200 --> 00:28:26,900
founder.
Let's sales to growth to a
484
00:28:26,900 --> 00:28:30,500
repeatable process.
Then we feel the company is in a
485
00:28:30,500 --> 00:28:35,200
position to really accelerate to
become the category leader, and
486
00:28:35,600 --> 00:28:39,300
help them in terms of
accelerating improving all the
487
00:28:39,300 --> 00:28:42,200
metrics and so forth.
And then, Then also make the
488
00:28:42,208 --> 00:28:45,600
company very attractive for
scale growth investors as well
489
00:28:46,400 --> 00:28:49,400
perfectly lovely people.
If anyone here listening to this
490
00:28:49,400 --> 00:28:52,100
episode's, fits this
description.
491
00:28:53,000 --> 00:28:57,000
There's going to be a link to a
enums LinkedIn in the
492
00:28:57,008 --> 00:28:59,600
description of this episode
along with the link to storm
493
00:28:59,600 --> 00:29:03,000
Ventures.
Along with the link to the
494
00:29:03,000 --> 00:29:05,800
hundred page report on how to
unlock your growth.
495
00:29:06,000 --> 00:29:08,100
And that's going to be my call
to action is usually check out
496
00:29:08,100 --> 00:29:10,400
the description says episodes.
I will click all the links that
497
00:29:10,400 --> 00:29:12,000
I've mentioned.
In there.
498
00:29:12,000 --> 00:29:14,700
So if you're interested,
definitely check it out.
499
00:29:14,800 --> 00:29:16,600
And as usually have a good day,
00:00:05,200 --> 00:00:07,800
They're releasing to fundraising
video a podcast about
2
00:00:07,800 --> 00:00:11,400
fundraising for early-stage
startups, the major rule that we
3
00:00:11,400 --> 00:00:14,600
follow here is no bullshit on
this podcast.
4
00:00:14,600 --> 00:00:17,800
No music to relax, you know,
advertisements of our sponsors.
5
00:00:18,000 --> 00:00:21,100
We only talk about fundraising
here and nothing else.
6
00:00:21,400 --> 00:00:24,700
So let's jump into the episode.
And today's guest speaker, we
7
00:00:24,700 --> 00:00:28,100
have tee hee Nam managing
director and co-founder and
8
00:00:28,100 --> 00:00:32,600
storm Ventures table.
Was the VC for over 20 years and
9
00:00:32,600 --> 00:00:37,000
this episode, we'll talk about
how storm Ventress has invested
10
00:00:37,000 --> 00:00:40,400
in over 220 B2B software
companies.
11
00:00:40,700 --> 00:00:43,500
How do they choose those?
How do those become unicorns?
12
00:00:43,500 --> 00:00:45,500
And Ward are some of the secrets
to success.
13
00:00:45,700 --> 00:00:48,400
And, of course, we're going to
touch on to the book that they
14
00:00:48,400 --> 00:00:52,800
can on roads survival to thrival
and this guy's major to
15
00:00:52,800 --> 00:00:56,100
concerns.
That's old Founders have one
16
00:00:56,200 --> 00:01:00,300
being fired as a CEO of their
own company and to achieve This
17
00:01:00,300 --> 00:01:02,900
growth and unlocking the growth.
So did he?
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00:01:03,000 --> 00:01:05,500
Let's kick it off by you giving
us some background on yourself
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00:01:05,500 --> 00:01:09,800
and on storm Ventures, great.
Well, first of all Constantine,
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00:01:09,800 --> 00:01:12,200
really appreciate the
opportunity to be part of your
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00:01:12,200 --> 00:01:15,200
podcast and the community that
you're building.
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00:01:15,200 --> 00:01:20,100
So appreciate that quick
background about myself is, I
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was born in Korea, we immigrated
to United States.
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When I was five years old,
didn't have much, say in the
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00:01:24,900 --> 00:01:26,800
matter, I just sort of tagged
along.
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And then I was an applied.
Math major in college.
27
00:01:31,200 --> 00:01:35,700
So I like modeling and looking
for patterns of success and
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failure.
I actually then wanted to become
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00:01:39,000 --> 00:01:43,300
a programmer, go get an MBA, but
my parents want me to go md-phd
30
00:01:43,300 --> 00:01:47,100
and so we compromised on another
professional degree law school.
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00:01:47,600 --> 00:01:50,200
And so, then I went to law
school and after graduation,
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00:01:50,200 --> 00:01:52,900
I've been out here in Silicon
Valley, working with tech
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00:01:52,900 --> 00:01:58,400
startups.
Nice perks of having siblings
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00:01:58,400 --> 00:02:00,500
right there.
My brother dropped out of you
35
00:02:00,500 --> 00:02:02,300
silly.
So my parents just one needs to
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00:02:02,300 --> 00:02:05,500
actually graduate school or
special?
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00:02:05,500 --> 00:02:09,800
Fortunately, I'm the second son.
Oh let's just say my older
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00:02:09,800 --> 00:02:11,300
brother.
He's a medical school.
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00:02:11,300 --> 00:02:17,200
Professor fam right there.
See that's someone's got to be
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00:02:17,200 --> 00:02:20,800
different.
There is in defense of my
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00:02:20,800 --> 00:02:22,700
brother.
I'm going to say that he is a
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00:02:22,900 --> 00:02:24,900
software developer.
Working for Facebook.
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00:02:24,900 --> 00:02:27,800
So he's doing just fine without
that degree.
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00:02:28,400 --> 00:02:33,800
But enough of my siblings for
let's talk about the, your
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00:02:33,800 --> 00:02:36,400
background and specifically the
fact that you were in Germany
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00:02:36,400 --> 00:02:39,200
and you have actually helped
tons and tons of companies for
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00:02:39,200 --> 00:02:42,300
raise money, while you were in
the legal field.
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00:02:42,400 --> 00:02:43,900
So can you tell us a little bit
more about that?
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00:02:43,900 --> 00:02:47,000
A lot of Founders actually reach
out to me asking it.
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00:02:47,000 --> 00:02:52,200
Can I find attorneys who instead
of charging me cash will work
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00:02:52,200 --> 00:02:54,400
for equity?
Right.
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00:02:54,400 --> 00:02:58,000
So, you know, after graduation,
I really wanted to work with
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00:02:58,000 --> 00:03:00,900
startups and so I came out to
Silicon Valley and started
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00:03:00,900 --> 00:03:04,600
working at Wilson sonsini and
made partner there.
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00:03:04,600 --> 00:03:07,500
And at Wilson just work with a
lot of startups.
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00:03:07,500 --> 00:03:11,300
And because that's the reason
why I came and it was a lot of
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00:03:11,300 --> 00:03:12,800
fun.
You know, just meeting different
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00:03:12,800 --> 00:03:16,000
Founders and sort of helping
them and their startup Journey
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00:03:16,000 --> 00:03:20,900
such as incorporating them, I'll
tell you a story.
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00:03:20,900 --> 00:03:24,400
You know, when I started as an
attorney, I felt like I Was like
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00:03:24,400 --> 00:03:29,400
perfectly set for to work with
high-tech startups, because, you
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00:03:29,400 --> 00:03:32,800
know, I was studied applied math
or Harvard, knew a lot about
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00:03:32,800 --> 00:03:36,700
tech and then, you know, I
studied a lot of corporate other
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00:03:36,700 --> 00:03:39,200
law as Chicago.
So I thought I was like, so
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00:03:39,200 --> 00:03:44,400
prepared came to Wilson to work
with startups and I was 25 years
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00:03:44,400 --> 00:03:48,400
old, but I look like I was 16
and I was meeting this founder
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00:03:48,500 --> 00:03:50,400
and the founder asked me.
This question.
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00:03:50,400 --> 00:03:52,800
I was so prepared.
I thought asked me this
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00:03:52,800 --> 00:03:55,600
question.
You need ink in the company name
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00:03:56,500 --> 00:04:00,000
and despite all my hours of
studying, I never looked into
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00:04:00,000 --> 00:04:03,400
the company name and so I had
this deer in the headlights look
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00:04:03,500 --> 00:04:06,000
and so the founders thought I
was clueless.
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00:04:06,400 --> 00:04:09,500
Okay.
But anyway I spent the next two
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days researching this question.
So I was prepared for the next
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founder that I saw so they of
course and every founder ask
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00:04:17,600 --> 00:04:20,899
about their name, right?
So they asked and I had like
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00:04:20,899 --> 00:04:23,700
researched it so I gave the
right answer.
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00:04:23,900 --> 00:04:27,500
Sir and then they decide to go
with ink in their name.
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And then the next question they
ask me is do they need a comma
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00:04:30,800 --> 00:04:33,700
before ink and I'm thinking,
man.
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00:04:33,700 --> 00:04:37,100
I just spent days researching
but didn't, you know, research,
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00:04:37,100 --> 00:04:41,200
whether you need a comma or not.
So you know but anyway that was
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00:04:41,200 --> 00:04:44,500
like my introduction working
with startups and the beauty
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00:04:44,500 --> 00:04:46,800
was, you know, just work with a
lot of companies.
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00:04:46,800 --> 00:04:50,000
I worked with over 200 startups
and just sort of got an
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00:04:50,000 --> 00:04:56,300
understanding of the startup
Journey because 90% of the
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00:04:56,300 --> 00:05:00,000
Journey of similar for a lot of
these startups, whether they're
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00:05:00,000 --> 00:05:04,900
biotech medical device, you
know, internet or semis,
89
00:05:05,500 --> 00:05:08,000
definitely, they all have very
similar starts and the strategy
90
00:05:08,000 --> 00:05:12,600
there are can be very much
repetitive, but ironically know
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00:05:12,600 --> 00:05:15,100
if I work for a company that
does in corporations for
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00:05:15,100 --> 00:05:18,100
startups.
And you know what, I'm not even
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00:05:18,100 --> 00:05:21,100
sure if I think is required.
I don't believe so.
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00:05:21,100 --> 00:05:22,700
I think you can.
There it is.
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00:05:23,900 --> 00:05:27,700
Ali required, but it makes it
easier when your qualifying to
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00:05:27,700 --> 00:05:29,900
do business in other states and
so forth.
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00:05:29,900 --> 00:05:32,800
And this would but this was seen
a long time ago, you know, to be
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00:05:32,800 --> 00:05:36,200
honest Constantine I have not
researched this question
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00:05:36,200 --> 00:05:38,900
recently.
Well, it's everything.
100
00:05:38,900 --> 00:05:41,800
So this podcast it's not illegal
affront entually, why?
101
00:05:41,800 --> 00:05:45,800
So people so I'm sure not sure
but this check it out there's
102
00:05:45,800 --> 00:05:48,100
Google now.
So you can just go on your
103
00:05:48,100 --> 00:05:49,800
phone.
Go on your computer and double
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00:05:49,800 --> 00:05:52,700
check.
What were telling you here, put
105
00:05:52,800 --> 00:05:55,300
enough of the illegal.
Hope, let's talk about your
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00:05:55,300 --> 00:05:58,500
investments from Storm.
Ventures on our printer, you
107
00:05:58,500 --> 00:06:02,000
call, you have mentioned that
you've invested in roughly 220.
108
00:06:02,000 --> 00:06:06,200
B2B software companies and out
of them thirteen became the
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00:06:06,200 --> 00:06:09,700
Unicorn.
So question is, what is the key
110
00:06:09,700 --> 00:06:11,400
to success?
There were those certain
111
00:06:11,400 --> 00:06:16,500
companies doing something, some
particular patterns, some, you
112
00:06:16,508 --> 00:06:21,200
know, strategy that is just,
they were replicating the
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00:06:21,200 --> 00:06:23,400
strategies that have worked for
other companies.
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00:06:23,800 --> 00:06:27,000
Or were they all beating cases?
Yeah.
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00:06:27,000 --> 00:06:31,300
So I mean these are companies
ranging from like Marketo to
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00:06:31,300 --> 00:06:34,000
more recent companies.
Like I'll go, Leah, work Auto
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00:06:34,000 --> 00:06:40,200
Talk desk and whether us
companies marketing workout, or
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00:06:40,200 --> 00:06:44,100
us companies are like Solaris
bank or a pipe drive out of
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00:06:44,108 --> 00:06:47,200
Europe.
I think there's really the
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00:06:47,200 --> 00:06:52,200
commonality of unicorns and B2B
software is simple as that.
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00:06:52,200 --> 00:06:56,000
You just need to be a high
growth company with good unit
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00:06:56,000 --> 00:06:58,000
economics.
With good business model.
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00:06:58,800 --> 00:07:05,300
And if you have that then
everyone's excited about you.
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00:07:05,300 --> 00:07:09,100
So another way of looking at it
as I look at it is that we're
125
00:07:09,100 --> 00:07:12,000
looking for companies that can
serve a big wave.
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00:07:12,900 --> 00:07:16,800
The bigger the wave the bigger
the company can be and surfing
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00:07:16,800 --> 00:07:20,000
means that you know you're
growing effortlessly to be the
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00:07:20,000 --> 00:07:24,500
leader and so as an early stage
to investor, what we look for is
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00:07:24,500 --> 00:07:28,100
a wave early on That we think
can be a big wave.
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00:07:28,200 --> 00:07:32,600
Hmm.
And second is a CEO that we
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00:07:32,600 --> 00:07:35,700
think that can surf the wave,
right?
132
00:07:35,700 --> 00:07:38,900
So if when those two things
happen, good things happen to
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00:07:38,900 --> 00:07:42,200
everyone else, right?
That does make quite a bit of
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00:07:42,200 --> 00:07:43,800
sense.
So let's, let's talk about that
135
00:07:43,800 --> 00:07:46,200
wave surfing.
How do you identify those?
136
00:07:46,200 --> 00:07:51,300
So a lot of Founders starts
companies in probably newly
137
00:07:51,300 --> 00:07:54,700
created markets, work, margins
that don't even exist yet and
138
00:07:54,700 --> 00:07:58,400
how can they be?
The ones, you know, how can they
139
00:07:58,400 --> 00:08:01,500
check if that's a real wave or
it has the potential of becoming
140
00:08:01,500 --> 00:08:04,700
a real wave or it's just, you
know, if Luke something that's
141
00:08:05,200 --> 00:08:08,900
kind of seems reasonable, but in
reality, it has very little
142
00:08:08,900 --> 00:08:13,500
chance of even being funded by
VCS who like to risk.
143
00:08:15,400 --> 00:08:20,800
So, that's a great question
about, you know, identifying
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00:08:20,800 --> 00:08:26,000
something that early on that is
small but looks like it could be
145
00:08:26,000 --> 00:08:32,100
a Big way and I would say that
in our investments it's been
146
00:08:32,100 --> 00:08:34,700
rare that we've been wrong about
the wig.
147
00:08:36,299 --> 00:08:39,200
And I think that's okay with
Founders in general, as they
148
00:08:39,200 --> 00:08:43,299
really look at it.
The problem is, it's not the
149
00:08:43,299 --> 00:08:46,600
way, but the timing, you know,
you could be off.
150
00:08:46,700 --> 00:08:50,400
In other words, that either
being too early or do you know,
151
00:08:50,400 --> 00:08:52,400
if you're too late as a
start-up?
152
00:08:52,400 --> 00:08:54,700
It's almost impossible to catch
the wave.
153
00:08:55,100 --> 00:08:58,100
And then if you're too early,
It's really important to make
154
00:08:58,100 --> 00:09:01,900
sure you're still surviving when
the wave comes and hits you.
155
00:09:02,700 --> 00:09:07,800
So the challenge is to just get
the timing, right?
156
00:09:07,800 --> 00:09:10,700
And an example that it's like
metal burps, you know, we're all
157
00:09:10,700 --> 00:09:13,600
talking about metaverse, going
to be something big.
158
00:09:13,600 --> 00:09:16,400
I mean, Facebook, even changed
their name accordingly.
159
00:09:17,100 --> 00:09:20,600
And I think everyone will
probably think that, you know,
160
00:09:20,600 --> 00:09:24,300
that has a potential of being a
huge wave, but the question is
161
00:09:24,300 --> 00:09:28,300
one, the question is when I
mean, I hope that Facebook has a
162
00:09:28,308 --> 00:09:31,000
resources to survive that even
the other a little bit too early
163
00:09:31,000 --> 00:09:35,400
because otherwise My Brother's
Keeper is questionable.
164
00:09:36,700 --> 00:09:39,800
I think they have the resources
and the conviction or they do.
165
00:09:40,100 --> 00:09:42,200
Yes.
So it's like you got to get the
166
00:09:42,200 --> 00:09:44,100
timing right?
And the next thing I have to do
167
00:09:44,108 --> 00:09:46,400
is you have to catch that wave,
right?
168
00:09:46,500 --> 00:09:49,500
So let's let's talk about cash
in that wave and we're going to
169
00:09:49,500 --> 00:09:51,900
jump a little bit forward and
then go back to talk a little
170
00:09:51,900 --> 00:09:54,900
bit more about your background
and specifically you as we
171
00:09:54,900 --> 00:09:56,300
starting your own company and
selling it.
172
00:09:56,500 --> 00:09:59,600
Julie, but let's talk about
catching that wafer.
173
00:09:59,600 --> 00:10:02,700
So in the book that you have
mentioned in our print recall,
174
00:10:02,900 --> 00:10:06,500
survival to thrival, the one
that you've created, one of the
175
00:10:06,500 --> 00:10:07,700
subjects that you were talking
about.
176
00:10:07,700 --> 00:10:11,700
If I remember correctly, is the
growth part, right?
177
00:10:12,100 --> 00:10:15,000
How do you start making those
initial sales where do you
178
00:10:15,000 --> 00:10:17,900
start?
So, can you give some advice to
179
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release?
Each Founders who are listening
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to this right now?
Who maybe have some kind of
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product?
Something resembling, the final
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product, something that kind of
works.
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How do they start making sales?
How do they pick the interest of
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the buyers in something?
That's not probably fully
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finished yet, right?
So let me step back.
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And when we call this phase, the
companies in is unlocking
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growth.
Because first of all, when you
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want to talk about something is
always good to have a name.
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And so it's about unlocking
growth.
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And what that is is what
requires is a transition from
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founder.
Let sales were Have a founder or
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co-founders that are very good
at going out and getting
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customers by himself or herself
because, you know, they have the
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passion, they have the vision
and so forth, so they can close
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so many times.
What, what's important unlocking
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growth is going from this
transition from founder, like
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growth to some repeatable,
scalable go-to-market that mere
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mortals can do.
In other words, you know, you
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don't have to hire a clown of
the Der, you can just hire any
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normal person and then they
become immediately productive as
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a sales person or as a marketing
person or product person.
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So you don't have to hire
unicorns, and if you can do
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that, then you can start scaling
and we call that finding
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go-to-market fit that.
Repeatable, scalable predictable
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go-to-market process and so this
turns out to be the most
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important value creation, Part
of a start-up is when you go
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from the beginning, where your
founding, the company trying to
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get some customers with by,
finding product-market fit to
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later on when you're trying to
become the leader in your
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category.
And so this transition we call
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unlocking growth and it's it
turns out to be so critical.
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It's the key value inflection
point of a start-up and within
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unlocking grope, you know, we've
Come up with a process that
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works.
It's like a recipe that works
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for our companies that that we
share as well, right?
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So we'll probably touch on to
that recipe a little bit later
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on when we go a little bit more
into depth of what the book is
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about and what you cover there.
And also there's me case study
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at the end, just to quick peek
into what's going to come.
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But now, question about the
company that you have started
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yourself and you have
successfully sold it to Kenny,
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Also more about that company and
what was it about and how did
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you eventually unlock the growth
for that company yourself?
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Sure.
So this company was airspace and
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it was in the early company, one
of the first in Enterprise
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Wi-Fi.
So the way we were thinking was
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that wife, I was going to become
ubiquitous in the Enterprise and
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so if it becomes ubiquitous then
you need something to connect
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it.
All right?
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So you need something that
connected, you need something to
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manage it and something too.
Make it secure and that would be
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the Enterprise Wi-Fi back back
in.
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You know, and as you know, Wi-Fi
now it comes with every laptop
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comes with every smartphone and
so forth.
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But this is before, Wi-Fi was
ubiquitous, you know, that was
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the way.
So felt like Wi-Fi devices are
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going to become.
Ubiquitous it will become
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standard and Enterprises and the
so Enterprises will need this
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solution.
Okay.
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And then did he?
She never correct.
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So we were developing the right,
right?
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So that was the way and we sort
of timed it, right?
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And then but we weren't the only
ones there were some other
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competitors.
Well to and question them become
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is then you know, how do we
catch that wave to become?
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You know the lead Surfer.
Yeah, versus just wiping out
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right right.
And and so in our case, We
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really thought about the the go
to market, and the key to our
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go-to-market is that we felt
that our biggest competitor at
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the time would be Cisco because
this goes number one, networking
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equipment, provider at that
time.
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And so we then replicated a
go-to-market strategy that some
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of the other companies that use
successfully gained Cisco, which
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is to sign up Partners.
So, we signed up a And your
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partner's which helped
accelerate the company from 0 to
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100 million in Revenue in just a
few days.
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And when you're saying Partners,
you mean the field Partners,
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right?
Companies like seeing like
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Alcatel, NEC and others that
have, they were selling
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networking equipment at the
time, but what their customers
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needed, this is sort of Wi-Fi
solution, gotcha.
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So all right, it looked at this
and say, Meet Leo.
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We got to keep our existing
customers happy.
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And so you know, we want to
resell this airspace stuff
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because the alternative is that
the customer may go to Sisko.
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Yeah and Cersei will buy Wi-Fi
from you and then Cisco will use
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that as the wedge to.
Then knockout incumbent?
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Yes, that is absolutely great
tragic.
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Great strategy right there.
Perfect love to hear that.
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And how did you get to the exit?
Was they exit like So we sold it
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for 450 million to actually says
is okay, and that's because it's
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just do realize that they have
the old architecture.
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We had the new architecture and
as a result, you know, we were
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beating them and do.
Nice, congrats.
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That's was that the initial plan
for you, were you looking at
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Cisco as your potential future
acquirer or no, we're not
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really, we're focused on just
building the company and the
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opportunity just came at that
time.
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Fair enough.
But I think, you know, I just
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bring that up as a metaphor of,
you know, we'd serve identified
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the wave, we caught the wave and
a key part of catching.
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The wave is really how to unlock
growth.
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And then, you know, once were
able to unlock growth and become
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a high Growth Company than
everyone wants to invest in you
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and join you and so forth.
And so at that point fundraising
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is not an issue, it's an issue
to write.
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Make sure that you don't spend
too much time on that and
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actually focus on building the
company itself.
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00:16:55,500 --> 00:16:58,500
So on this note, let's let's
actually go back to talking
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about storm dangers and what
you're doing with that fund.
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00:17:01,100 --> 00:17:04,200
So, first things first, let's
touch on to the book that you
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wrote survival to thrival.
I know that writing a book is
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going to take ages for me.
Personally, we were developing a
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course about fundraising for
early-stage startups, and it
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00:17:13,708 --> 00:17:18,099
took us roughly what six months
while doing it kind of part time
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after work after the podcast.
So it took us ages to write just
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the course and the book I would
Agent seeks way, way more effort
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than that.
So, first question, why you
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decide to write that book at?
What was the driving force for
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you?
Why did you choose that?
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00:17:32,900 --> 00:17:34,800
You know, it's a wise time
investment for you.
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A key reason, why?
My co-author Bob tanker, he and
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I decided to go on this journey
as one as we thought it wouldn't
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be too much work.
Okay, wrong with that.
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But that was our expertly
assumption and then second is,
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you know, So many people have
helped us in our careers and
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work.
And then the next generation was
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coming to us with questions that
we thought we can just simply
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write it down and share it in a
very systematic.
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Easy manner should all right.
That's that's very nice, giving
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back, that's definitely.
So that was the idea is sort of
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paying back.
What people have given us.
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Yeah, fair enough.
Fair enough, definitely not idea
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for us.
We're too poor to give back at
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this point but definitely good
drive.
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Force and how long did it take
you to write that book?
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I'm just curious at this point.
It's ended up taking us for
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00:18:29,300 --> 00:18:30,700
years for years.
Bam.
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00:18:30,800 --> 00:18:33,800
That's what I thought.
Yeah, I thought we were going to
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be finishing our course in
roughly 23 months because I
321
00:18:38,508 --> 00:18:41,800
mean, it's just a course about
part of fundraising, nope, six
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00:18:41,800 --> 00:18:45,500
months right there.
So, yeah, mistakes were made on
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00:18:45,500 --> 00:18:48,100
our side as well.
So, let's talk about the
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00:18:48,100 --> 00:18:50,400
contents of the book and
specifically, one of the
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00:18:50,400 --> 00:18:53,000
concerns that you cover in the
book or one of the concerns of
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00:18:53,000 --> 00:18:56,500
the founders that You cover in
the book which is getting fired
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00:18:56,500 --> 00:18:58,700
from your own company.
Can you tell us a little more
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00:18:58,700 --> 00:19:01,300
about that?
How does that work and how did
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00:19:01,300 --> 00:19:03,000
you address that concern in your
book?
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00:19:04,300 --> 00:19:06,800
Yeah.
So you know as an attorney I
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worked with hundreds of startups
and as a start-up attorney, many
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questions times I get pulled in
because there's a board fight
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00:19:14,400 --> 00:19:17,300
about who to see Hill is and so
forth.
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00:19:17,900 --> 00:19:21,300
So I got to experience that
first as an attorney and then
335
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later on as a VC board member,
you know, you Involved in this,
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00:19:25,900 --> 00:19:30,200
you know, just went through a
lot of executive changes
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00:19:30,200 --> 00:19:35,100
unfortunately and as one
thorough at what we realized is
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that many times, it's less about
the person or the personality,
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00:19:40,200 --> 00:19:46,200
but more about the situation and
there are situations where a
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person who's a superstar today
can really be struggling
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tomorrow.
Yeah, it's the same person.
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It's not like the person gave
up, you know, the person is
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passionate as ever and so forth
but you know, there's many
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situations like that.
And so what we wanted to do was
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to explain why that happened and
how a person can avoid that.
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And, and so that led us to sort
of write, the Books is to help
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people anticipate how your job
is changing.
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So you can anticipate the future
and at the same time, help you
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unlearn something.
That made you the superstar that
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you were.
And so this way you can
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anticipate and unlearn and as a
result go from being a superstar
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to the Super Start, the next
stage of the company.
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So that was the our thesis and
and with that ended up writing
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two books.
Thanks.
355
00:20:47,800 --> 00:20:50,300
Wait, you said to boobs?
Yes.
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00:20:50,400 --> 00:20:54,400
Because I think to explain to
people Ernie.
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We had to explain the company
Journey.
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What I mean by that is that take
a VP of sales, a VP of sales at
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00:21:03,700 --> 00:21:07,000
the beginning of a company you
know where you only have sale.
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00:21:07,000 --> 00:21:12,100
13 sales reps is very different
than a VP of sales.
361
00:21:12,100 --> 00:21:16,000
That has, let's say, like, 50
sales reps, which is different
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than if you have a VP of sales,
in charge of 1000 sales Rose, it
363
00:21:19,900 --> 00:21:22,800
could be the same title VP of
sales, you can say, is doing the
364
00:21:22,800 --> 00:21:25,900
same thing.
The role is quite different and
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00:21:25,900 --> 00:21:28,300
that's because the companies at
different stages.
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So what we wanted to do was to
explain the company journey, and
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then saying, because of the
company Journey, there's a
368
00:21:36,800 --> 00:21:41,700
people Journey on top, which is
how each role changes whether
369
00:21:41,700 --> 00:21:47,100
you're the CEO, the VP of sales,
the CFO or Board number how your
370
00:21:47,100 --> 00:21:51,500
role is going to change as the
company changes and as a result
371
00:21:51,500 --> 00:21:54,000
you know you as an individual
have to change.
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Change or you will be changed,
right?
373
00:21:56,900 --> 00:21:59,200
That's that pretty much sums it
up.
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00:21:59,200 --> 00:22:01,400
And by the way, because I'm
trying to just sort of, explain
375
00:22:01,400 --> 00:22:05,900
it in the manner, which is not
personal, you know, right.
376
00:22:05,900 --> 00:22:10,000
For people who are curious about
how those changes might happen,
377
00:22:10,000 --> 00:22:14,200
specifically, and y-yes, legal
side of it, especially we've
378
00:22:14,200 --> 00:22:17,800
actually just made interview
with the founder of a company
379
00:22:17,800 --> 00:22:21,000
that's focused specifically on
the governing board management.
380
00:22:21,500 --> 00:22:25,600
So if you're curious about how
this Governing boards work, how
381
00:22:25,600 --> 00:22:28,600
you get people on there, how do
you make sure that your
382
00:22:28,600 --> 00:22:32,000
governing board does not fire
you once the company changes.
383
00:22:32,400 --> 00:22:33,700
Definitely check out that
episode.
384
00:22:33,700 --> 00:22:36,600
It's cold.
Governing boards explained very
385
00:22:36,600 --> 00:22:37,600
straightforward.
So check.
386
00:22:37,600 --> 00:22:40,200
Yeah.
That's that is so important to
387
00:22:40,300 --> 00:22:43,300
100% understand the role of the
board.
388
00:22:43,400 --> 00:22:47,500
Yeah, it's personally had very
little idea of how that actually
389
00:22:47,500 --> 00:22:49,100
works.
So dab, so could be super
390
00:22:49,100 --> 00:22:52,700
helpful for anyone who is or
used to be at the same stage as
391
00:22:52,700 --> 00:22:55,400
I was at the moment of recording
of that interview.
392
00:22:55,800 --> 00:23:00,000
So on this note, let's go and
talk a little bit about the the
393
00:23:00,000 --> 00:23:02,300
thing that you mentioned on our
pre-interview call, which is the
394
00:23:02,308 --> 00:23:05,600
fact that you've done a workshop
for Korean University, both
395
00:23:05,600 --> 00:23:07,900
starting specifically data,
science companies.
396
00:23:07,900 --> 00:23:12,600
And on that Workshop, you have
covered two key things that had
397
00:23:12,600 --> 00:23:15,900
to be done in order to launch
that company towards the
398
00:23:15,900 --> 00:23:17,600
success.
Could you explain those two
399
00:23:17,600 --> 00:23:19,700
things?
So, that's sure everyone can
400
00:23:20,000 --> 00:23:24,900
understand them, right?
So we worked on To sort of I
401
00:23:24,908 --> 00:23:32,400
thought would be a high return
things for them one.
402
00:23:32,400 --> 00:23:38,700
And that is one is to make a 5
minute pitch on getting your
403
00:23:38,700 --> 00:23:42,100
first to your first customer on
why they should be your customer
404
00:23:43,400 --> 00:23:49,400
and the second is to do another
five minute pitch on to up to
405
00:23:49,400 --> 00:23:55,600
your first investor.
So, the whole idea here was to
406
00:23:55,600 --> 00:24:01,800
do very short presentations, to
help get your first customer and
407
00:24:01,800 --> 00:24:06,600
to get your first investor,
because if you do that, then you
408
00:24:06,600 --> 00:24:08,800
sort of can get your company off
the ground.
409
00:24:11,000 --> 00:24:14,100
Absolutely.
And that is applicable to every
410
00:24:14,100 --> 00:24:14,800
single company.
Correct?
411
00:24:14,800 --> 00:24:19,200
Especially, you know, in the
data science, B2B world for
412
00:24:19,200 --> 00:24:19,900
sure.
Right.
413
00:24:20,100 --> 00:24:23,100
B to C is a little bit different
because you know, it's not like
414
00:24:23,100 --> 00:24:26,500
yeah, it's sell a customer but
in B2B.
415
00:24:26,500 --> 00:24:29,600
Yes, you have to get your first
customer and you have to get
416
00:24:29,600 --> 00:24:31,100
your first investor.
Hmm.
417
00:24:31,400 --> 00:24:34,200
Absolutely.
That is, there is definitely
418
00:24:34,200 --> 00:24:35,600
huge difference between B2B and
b2c.
419
00:24:35,600 --> 00:24:38,600
So let's focus on to be to be
for this one.
420
00:24:38,600 --> 00:24:43,100
And question is what needs to
Done in order to picture, very
421
00:24:43,100 --> 00:24:45,300
first customer, where should you
start?
422
00:24:45,300 --> 00:24:49,200
Especially again, if your
product is unfinished, where do
423
00:24:49,200 --> 00:24:52,400
you start that pitch?
Yeah.
424
00:24:52,400 --> 00:24:58,400
So the first thing is to
understand understand the
425
00:24:58,400 --> 00:25:02,100
mindset of that B2B customer.
I think that's the most
426
00:25:02,100 --> 00:25:05,200
important thing is that you have
to understand that person's mind
427
00:25:05,200 --> 00:25:12,300
set and I have a view of the B2B
customer As someone who's
428
00:25:12,600 --> 00:25:20,500
relatively smart but is lazy,
you know, and wants to look good
429
00:25:20,500 --> 00:25:23,300
for his or her boss.
Okay.
430
00:25:23,400 --> 00:25:27,300
Is this simple as that?
So what does that mean?
431
00:25:27,300 --> 00:25:33,700
It means that if you don't come
with a product that addresses an
432
00:25:33,800 --> 00:25:40,900
urgent pain then laziness takes
over and this like yeah, this
433
00:25:40,900 --> 00:25:43,200
could be great.
But maybe I'll look at a six
434
00:25:43,200 --> 00:25:47,100
months from now, a year from now
and then you come back in six
435
00:25:47,100 --> 00:25:49,900
months and it's like, oh I'll
look at it six months from now
436
00:25:49,900 --> 00:25:54,300
and so forth.
So the First thing is, you know,
437
00:25:54,600 --> 00:25:57,800
it has to address an urgent
thing.
438
00:25:58,100 --> 00:26:01,900
Hmm, absolutely 100%.
That's the major requirement for
439
00:26:01,900 --> 00:26:05,600
building any solution to a
problem, if it's not an erosion
440
00:26:05,600 --> 00:26:09,400
problem, don't even bother the
chances of you making it far,
441
00:26:09,400 --> 00:26:12,000
far too low.
People are just going to say,
442
00:26:12,100 --> 00:26:15,100
we'll check it out.
Six months later, and that's
443
00:26:15,100 --> 00:26:18,400
just the same thing as saying.
No, but in a, you know, bad way.
444
00:26:18,800 --> 00:26:20,600
Yes.
So it's like answering the
445
00:26:20,600 --> 00:26:21,400
question.
Why?
446
00:26:21,400 --> 00:26:24,000
By now?
Yeah, exactly, exactly,
447
00:26:24,000 --> 00:26:27,300
definitely have to answer that
if you cannot answer that, you
448
00:26:27,300 --> 00:26:31,200
probably have to restructure
your offering quite a bit or the
449
00:26:31,200 --> 00:26:34,000
product itself.
So on this note, let's move on
450
00:26:34,000 --> 00:26:36,600
to the very last question.
It is a call to action.
451
00:26:36,600 --> 00:26:40,500
So he would you want to listen
to as soon as this episode is
452
00:26:40,500 --> 00:26:45,700
over.
You know, we have a website
453
00:26:45,700 --> 00:26:48,600
survival thrival.com and so if
people are interested they
454
00:26:48,600 --> 00:26:52,700
should just go on the website
and we actually have a four step
455
00:26:52,700 --> 00:26:56,300
recipe for unlocking growth that
we provide for free on the
456
00:26:56,300 --> 00:26:58,300
website.
It's about 100 Pages.
457
00:26:58,600 --> 00:27:02,200
Actually, we have to rewrite it
to make it more readable but 100
458
00:27:02,200 --> 00:27:06,700
pages in terms of how to unlock
growth and we've seen this
459
00:27:06,700 --> 00:27:09,300
recipe work.
Well, with our companies, all
460
00:27:09,300 --> 00:27:10,300
right.
That is great.
461
00:27:10,300 --> 00:27:12,600
All day for make sure to leave
Link in the description to the
462
00:27:12,600 --> 00:27:15,800
episodes and one more thing
before I forgot to ask.
463
00:27:16,100 --> 00:27:19,000
Could you briefly explain what
sort of interested in investing
464
00:27:19,000 --> 00:27:22,800
in terms of stage fields and
ever check size.
465
00:27:23,200 --> 00:27:28,000
So that the rice into this
storm, we focus on early stage.
466
00:27:28,000 --> 00:27:32,000
B2B software companies will be
some companies that we invest,
467
00:27:32,000 --> 00:27:34,800
which are pre-revenue.
But that's typically where we
468
00:27:34,800 --> 00:27:38,400
know the founders or one of the
founders, or really like the
469
00:27:38,400 --> 00:27:41,800
space.
Most of the time we best when a
470
00:27:41,800 --> 00:27:44,800
company has about a half a
million to about a million and
471
00:27:44,900 --> 00:27:47,900
annual recurring Revenue.
So basically they have some
472
00:27:47,900 --> 00:27:50,300
happy customers.
So we feel like they have
473
00:27:50,300 --> 00:27:53,900
product Market fit and then we
can, then we feel this is a
474
00:27:53,908 --> 00:27:56,400
company we can work with to
unlock growth.
475
00:27:57,100 --> 00:28:01,900
So if a company has sort of
product Market fit and we feel
476
00:28:01,900 --> 00:28:04,800
we can help them with go to
market, fit to unlock growth and
477
00:28:04,800 --> 00:28:06,700
that's like the ideal company
for us.
478
00:28:07,100 --> 00:28:10,900
Our initial check size is
between 3 to 6 million.
479
00:28:11,400 --> 00:28:14,200
Then we'll invest more and
follow on investments, but we've
480
00:28:14,200 --> 00:28:17,000
done seeds at a million or less
as well too.
481
00:28:18,400 --> 00:28:21,300
And then, as we work with a
company and help them unlock
482
00:28:21,300 --> 00:28:24,200
growth, by finding go to
markets, fit to go from that
483
00:28:24,200 --> 00:28:26,900
founder.
Let's sales to growth to a
484
00:28:26,900 --> 00:28:30,500
repeatable process.
Then we feel the company is in a
485
00:28:30,500 --> 00:28:35,200
position to really accelerate to
become the category leader, and
486
00:28:35,600 --> 00:28:39,300
help them in terms of
accelerating improving all the
487
00:28:39,300 --> 00:28:42,200
metrics and so forth.
And then, Then also make the
488
00:28:42,208 --> 00:28:45,600
company very attractive for
scale growth investors as well
489
00:28:46,400 --> 00:28:49,400
perfectly lovely people.
If anyone here listening to this
490
00:28:49,400 --> 00:28:52,100
episode's, fits this
description.
491
00:28:53,000 --> 00:28:57,000
There's going to be a link to a
enums LinkedIn in the
492
00:28:57,008 --> 00:28:59,600
description of this episode
along with the link to storm
493
00:28:59,600 --> 00:29:03,000
Ventures.
Along with the link to the
494
00:29:03,000 --> 00:29:05,800
hundred page report on how to
unlock your growth.
495
00:29:06,000 --> 00:29:08,100
And that's going to be my call
to action is usually check out
496
00:29:08,100 --> 00:29:10,400
the description says episodes.
I will click all the links that
497
00:29:10,400 --> 00:29:12,000
I've mentioned.
In there.
498
00:29:12,000 --> 00:29:14,700
So if you're interested,
definitely check it out.
499
00:29:14,800 --> 00:29:16,600
And as usually have a good day,
