Who's Fabio?
By Darren Ball (aka Reason) and JP Luchetti (aka Passion)
Who's Fabio?Aug 21, 2023
Tips for talking to investors if you want to raise money
What do you need to bring to a table before an investor says yes?
Specifically, what do you need to invest in before the investor you are speaking to right now would be willing to consider an investment with you?
Retention rates at 30%? 500 users? Product-Market Fit score > 50%?
ASK.
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
Waiting Lists and Community Building
There is a misconception that you need to grow your waiting list with people who are your target audience right now at this stage in your startups journey.
Not necessarily true.
Yes, you need superusers, but remember, ultimately, we are looking for proof.
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
Why would you build ANYTHING without having a waiting list?
Have we said this before? Yes
Can we say it enough? No.
Just this week we spoke to another founder who went product first instead of traction first.
Ouch.
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
That Money Slide
Man, it’s painful.
Another “Ask” slide with a pie chart showing 50% for “Marketing” spend.
What does that tell me? Literally nothing. Nothing useful anyway.
How you spend the money is your business.
What investors want to know is what outcomes they are buying with their money.
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
The purpose of the pitch
Consider how many pitch decks a VC receives every day.
90%+ get rejected out of hand. VCs don’t invest in “ideas”
They invest in companies.
They invest in momentum, aka track record.
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
When you just need fuel (and when you need a miracle)
We’re back after a short hiatus!
How do you know when you’re investor ready?
How much does your pitch and your performance have anything to do with it?
Let’s talk about the elephant in the room.
Is your startup at a point where you are in a credible position to secure funding?
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
WHO do you actually need on your waiting list?
One of the push backs that we often get from startups in our accelerators is about WHO they actually need on their waiting list.
We get it. If you are a Web3 startup, for example, you probably want to target Web3 natives who already use MetaMask for your pilot.
What is MetaMask, you say? Exactly.
BUT – that doesn’t mean you should be limiting your waiting list, or pitching your value prop with lots of impenetrable jargon.
Watch this week’s episode for more about balancing your waiting list and pilot priorities.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
Want to work with us? Join the Traction First startup accelerator. Get your first 500 users, build your MVP and get funding from investors.
Keeping prospective investors up to date is part of the job
We’ve heard from a lot of startup founders who have fallen into the invest-operate cycle.
3 months of hardcore fundraising followed by an almost exclusive focus on operating the business, until they come up for air again for the next capital raise.
The truth is that raising capital is something you need to do every morning. What does that look like?
Check out this week’s episode.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
Want to work with us? Join the Traction First startup accelerator. Get your first 500 users, build your MVP and get funding from investors.
The Startup Hour - Making learning fun again
JP and I are both big proponents of game thinking in product design. Jobs To Be Done market research will tell you what problems to solve and features to build.
But game thinking (vs gamification) will tell you how it needs to work to keep users engaged.
So it was a joy to meet Rose at the Tramshed Startup Showcase a few months ago to talk about her startup playthru, which is working on making
classroom learning fun again.
We talked about
- What games can teach us about good product design
- Why waiting lists matter and how they change the conversation with your team and investors
- How to make sure you answer the questions that matter for investors with your pilot
Don't miss it!
Passion and Reason
PS JP was still embroiled in his 4-month Open Reach saga when we recorded this, so forgive the spotty connection!
What does it really mean to create a “viral” product
Let’s face it, acquiring early adopters is basically hard.
Lots of startups tout so-called viral products, but in reality these are simply referral programs.
So what does it really mean to “go viral” and how can you design your product to be viral in nature so that your users become your best acquisition channel?
Let’s get into it.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
Want to work with us? Join the Traction First startup accelerator. Get your first 500 users, build your MVP and get funding from investors.
We need more MICROWAVES
Microwaves are the king of consumer products.
These days you don’t even have to set the time and power; you just tap the little icon for “Soup”.
Doesn’t get easier than that (not saying we like them, just saying they’re easy and appealing.)
No one sells microwaves by describing how they work.
And you shouldn’t be selling your consumer product by overexplaining the technology either.
Simplify the proposition.
Put it in your customer’s terms: the outcome they are trying to achieve.
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
Want to work with us? Join the Traction First startup accelerator. Get your first 500 users, build your MVP and get funding from investors.
Perfecting your sales motion
We get it… what the hell is a sales motion?
The short version: it’s how you sell; your unique blend of process and methodology.
Today’s episode is a great example of how to perfect your sales motion, which came out of a conversation with one of the awesome startups we are working with in the Moonbeam Web3 Accelerator together with our partner Rokk3r.
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
Want to work with us? Join the Traction First startup accelerator. Get your first 500 users, build your MVP and get funding from investors.
How to charge more
What to do when your market looks too small to you – and your investors?
The Four Fits (credit: Brian Balfour) is an incredible framework for thinking about your startup and answering questions like this.
Today’s episode is a great example of how to iterate your Four Fits, which came out of a conversation with one of the awesome startups we are working with in the Moonbeam Web3 Accelerator together with our partner Rokk3r.
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
Want to work with us? Join the Traction First startup accelerator. Get your first 500 users, build your MVP and get funding from investors.
The Startup Hour - FinTech for Students
As you all may or may not know, FinTech is one of our favourite spaces.
We've helped to create new startups solving problems for people trying to access credit, build wealth, stick to a budget, reduce their carbon footprint, save for a rainy day, and more!
So it was a real pleasure to chat to Surya and Suganth who are working on a FinTech proposition for foreign students at university in the UK.
In this episode we got stuck into the SMS pitch they had drafted ahead of time and broke it down with feedback that could be helpful to you too as you work on your own startup value proposition.
Check it out
Reason and Passion
The Startup Hour - A new view on nightlife - literally!
Now this one's interesting.
Ever wondered which night life spots are really vibing right now?
That's the problem that catchapp.live is working to solve.
This is a perfect case for the Recipe. Don't miss:
- Who do you need on your waiting list when you're building a marketplace
- How to get a marketplace proposition off the ground with a pilot
- How to run a marketplace pilot
- What metrics matter to track for your marketplace pilot
Check it out
Reason and Passion
The Startup Hour - For the love of pre-loved
We met Jess at the Tramshed Startup Showcase in London a couple months ago – and she immediately made an impact on us.
She has an incredibly inspiring startup story – and is on the way to great things ahead of her next round of funding, with a really fresh take on how to bring used and loved to people around the world.
(Check out http://usedandloved.com/)
Don't miss:
What convinced her to make the leap to full-time startup
Lessons from crowdfunding
Solving go-to-market challenges
Building a waitlist when you pivot your business
What to have in place before you go to investors for you next round of funding
Check it out
Darren and JP
Do you really need to build an app?
The biggest mistake people make when building their MVP is spending money on things that don’t matter AT ALL…!
Ask yourself: What is the innovation here? What’s my killer feature? What do I actually need to prove to investors?
Before you build your MVP, watch this.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
When to start your waiting list and your pilot
The purpose of a waiting list is evidence of interest. But it’s more than that.
It is a process of transformation – an opportunity to pivot your value proposition ON PAPER before you commit to building anything.
It is also the fastest way to create equity value – which means you could raise money if you needed to.
Let’s get into it.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
Do you need to protect your startup idea?
How much is an idea really worth?
Should you be protecting your startup idea with an NDA before you talk to anyone?
Here’s a hint: ALL of the founders we work with iterate their idea at least once after validating it with their target audience… so, what was the first idea worth, anyway…?
If you’re worried about sharing your idea, watch this video.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
Are you talking to the right investors?
Every venture capital fund has a thesis.
It describes their investment mandate i.e. what they told their Limited Partners they were going to invest in.
Perhaps they invest in pre-seed startups, seed-stage, or exclusively Series A only. Each of these stages is a proxy for the level of traction they are ready to invest in.
When you’re looking for investment you need to make sure you are talking to investors who are looking for you.
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
The million dollar question
Lots of founders start their pitches talking about what they’re going to do to “disrupt” and “revolutionise” the industry.
BORRRIIINNGG.
The million dollar question is: how?
Investors invest in the how. Are you clearly telling them how?
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
When you can’t compete on Product
What happens in a saturated market where it’s difficult to compete head-to-head on product?
How else can you differentiate your value proposition and get an edge?
Let’s dive into Product-Channel Fit with a real example from a startup we worked on last year.
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
What’s your startup DNA?
Everyone talks about Product-Market Fit….
“I know about that already”, you say.
Cool…What about the three OTHER Fits you need to nail if you want to get your startup off the ground successfully?
“Ah.”
Let us introduce you to the Four Fits!
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
“Nobody gets what I’m talking about!!”
One of the challenges that a lot of founders face in the beginning is trying to communicate what their product actually does. “Nobody gets it!”
That’s why we came up with the SMS pitch.
Imagine someone uses your product for the first time and texts a friend about it.
What would that text say?
The SMS pitch is the framework we use to make the value proposition clear and appealing.
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
Better product ideas
Developing product/feature ideas is at the core of your job as a startup founder.
In this episode we talk about how NOT to do it (trust us, we’ve been there…).
And how to do it better.
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
“What’s the problem?”
There are a lot of slides that appear in pitch decks about the problem that startups are trying to solve.
Many of them are too vague, generic and/or unrelated to the specific “Job” their target audience is trying to get done. It’s unhelpful from a product design standpoint but also, it’s a major missed opportunity to make an impact with investors.
Here are a couple of stories about finding the “problem” – from previous startups we’ve worked with, in sustainability and EdTech.
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
What's your North Star?
The point of the pilot is to prove to investors you have built something sticky.
What else?
In the book we talk about a number of other KPIs you will want to measure during the pilot, including the North Star KPI.
The North Star KPI demonstrates that you have clarity about how your business works and what the levers are for improving performance as a whole.
In this video, we make the case for why you need a North Star KPI for your startup.
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
"Dating" investors...
Even if you’re pre-traction, and you’re not raising just yet, it might be time to start sharing your progress on a regular basis with prospective investors.
JP and Darren talk about how to make sure it’s the right time, what you should think about sharing and how we recommend you do that.
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
“We love what you’re doing, but…”
“We love what you’re doing, but…we typically invest in startups with a bit more traction.”
Those of you who have started trying to raise money have probably heard that from investors more times than you care to remember!
In this video, JP and I walk through the “spectrum” of traction and what you need to articulate to investors if you want to raise capital, and how the Recipe can help you to do that.
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
The Legend of the MVP
Does a skateboard really count as an MVP for a car? Especially nowadays?
Is it even marketable to a car buyer? What would it prove to you/investors?
What’s the point of an MVP – or a Minimum Marketable Product – anyway, and what do you need to focus on when you are building yours?
Check it out.
Darren (aka Reason) and JP (Passion)
Got the book yet? This is the Recipe early-stage startup founders are using to get their tech startup off the ground and raise their first round of funding.
What needs to be true before you sit down with investors
Let’s imagine you’re preparing for a pitch meeting with a potential investor.
Do you know what needs to be true about your startup BEFORE they will even consider investing in you, especially as a first-time founder?
It’s not complicated.
And it’s not about coming up with the right things to say, either.
It’s about doing the work, and sharing your results.
Let’s get into it.
Passion and Reason
PS If you want the 3-part Recipe we use to go from idea to your first round of funding, check out our new book: https://tractionfirst.whosfabio.com/book
If Mr Miyagi was your startup advisor…
You know the scene In Karate Kid where Mr Miyagi tells the Karate Kid to paint the fence?
It was never really about painting the fence, was it?
Building a waiting list is not really just about the number of people you recruit either.
People think about it like a validation step.
That’s just painting the fence.
What’s really going on? And why does it signal to prospective investors?
Check it out.
Passion and Reason
PS If you want the 3-part Recipe we use to go from idea to your first round of funding, check out our new book: https://tractionfirst.whosfabio.com/book
Mmmm Red Velvet…
A waiting list tells investors you have something that serves a real market need.
But a pilot tells investors something about your product.
What can a bakery teach us about what product adoption really means?
This is key for traction.
Check it out.
Passion and Reason
PS If you want the 3-part Recipe we use to go from idea to your first round of funding, check out our new book: https://tractionfirst.whosfabio.com/book
Thinking about your MVP
OK, here’s a different way of thinking about your MVP.
And why it matters to raising your first round of funding.
Pay attention to the point about equity value
That’ll help you understand what investors are thinking about – and why.
Check it out.
Darren (aka Reason) and JP (Passion)
Tech startups are like hospital patients
Tech startups are like hospital patients.
They have serious health problems in the beginning.
It’s up to you to monitor its condition, diagnose the problems and do something to help.
Like taking a pulse or running a blood test and prescribing treatment.
Today we dig into one of the most important KPIs that we measure throughout the pilot.
Check it out.
Darren (aka Reason) and JP (Passion)
Don’t make this mistake when you pivot…
Pivot…Pivot! PIVAAT!
Don’t make this mistake when you pivot…
Recently we were talking to a tech startup that was pivoting away from B2C into B2B.
They had revenue but it felt like a tugboat, not a rocket ship.
And they needed to raise money to tackle a new market.
What most people don’t realize is you’re basically talking about a new business at that point.
Past revenue doesn’t count. So what proof do you have?
JP and I talk about the number 1 investment you can make before you sit down with investors when/if you need to pivot.
Check it out.
Darren (aka Reason) and JP (Passion)
The fastest way we know how to build equity value
What’s an early-stage investor thinking about when you pitch?
Equity value.
“How much is this business worth right now?”
“Do I believe it’s going to grow?”
In this video, we talk about the fastest way you can build equity value for your startup idea – and give investors confidence in the future.
If you’re not already doing this for your startup. Stop everything else and focus on this instead.
Check it out.
And be in the know!
Want to know the fastest way we know to take a tech startup from “Idea On a Cocktail Napkin” to “$1M+ Valuation”?
https://tractionfirst.whosfabio.com/start-book
Darren (aka Reason) and JP (Passion)
Ditch your Startup dating profile
Let’s imagine you’re sitting in front of an investor making a pitch for your first round of funding.
Do you know what questions they are trying to answer? Or the risks they are trying to evaluate?
JP is a Venture Partner at Mr. Pink – an early-stage Venture Capital fund in Argentina.
As a VC their job is to deploy capital effectively, i.e. they want to see their equity value grow. Sort of like investing in a house and watching it appreciate in value.
And it’s JP’s job to make recommendations to the investment committee.
One of the most important factors he looks at is the Founder’s track record of creating equity value.
Founders like to talk about the future and paint a rosy picture, kind of like a dating profile. But investors want the (sometimes unsavory) truth; what actually happened.
What can you do to give them confidence in your track record to date?
Check it out.
Darren (aka Reason) and JP (Passion)