Six Months to the day was when we launched our iPhone app. At the time, we were exclusively a website with a strong mobile presence. Over this timeframe, Yummly has risen from an up-and-coming player to the world-leading five-star recipe inspiration app on the iPhone - and we are just getting started.
Today we enthusiastically announced the launch of our iPad app – Yummly Recipes & Recipe Box for iPad.
Many companies take the approach of creating one app that can be viewed on different screens. Our team deliberately took a different approach. We observed distinctly different behaviors and use cases for our iPad users. While taking cues from our iPhone app, we built an app from the ground up that maximized the potential for the iPad, our service, and what it could do for our community of avid culinary Yummly members.
With the new Yummly app, the Yummly community will have every recipe in the world with them on their iPad – in the kitchen, on the couch, and on the go. The most powerful recipe search, the best recipe sites across the web, a digital recipe box, and recipe recommendations personalized to inspire culinary masterpieces.
To create our new iPad app, our eclectic, cross functional team abided by the following principles to aid us in our design and development process:
We truly believe that our iPad app will change the way people think about food and preparing meals for their households. We want to inspire the next generation of foodies to create memorable moments with friends, family, and loved ones using our apps.
… and today I will be providing you with a helicopter view of our bleeding edge, market leading startup, ‘DisinterYOUdiate’…. a startup going forward in the social space and securing mindshare through providing thought leadership and employing ninja-like best practices in un-usability effectively disintermediating the disintermediate process in the process of disintermediation thus cutting out the cutting out of the middle man, effectively putting the man back in the middle creating more jobs for the middle man.
Now… before I get started, I would like to push the envelope and ensure we
are all on the same page here… that is that today’s presentation facilitates a win-win scenario for all parties involved… a 1+1=3 situation if you will.
Our first action item is to hit the ground running with an epic, backward compatible, turnkey solution at the tipping point of change management in the emerging market of product and service development silo’s that will achieve critical mass and crush it like a rock star.
Today we will be “opening the kimono” allegorically speaking… showing transparency and organisational openness as we share our internal processes.
Forget this being a Google-killer, iPhone-killer or even Quora-killer… this
is an Anything-killer that even the guru’s, maven’s and diva’s agree will take user-generated content traction to the next level.
You may be thinking… “I/we just don’t have the bandwidth right now”.
Well… this scalable, enabling, minimalistic technology is so disruptive that it is a hyphen-killer… able to pivot, leverage, hack and curate unwanted hyphens seamlessly… and in doing so reduce bandwidth usage.
Less hyphens = less bandwidth. Simple really.
In order to ensure we gain maximum mindshare and a stealth-like product-market fit, we will incentivize new users through the freemium model, that in turn will go after the long tail in the hyper local, hyper social, hyper mobile, hyper-hyper-hyper (or Hyper 3.0) market and while doing so collect all the low hanging fruit baskets.
There are many challenges facing the 2.0 space right now… be it the 800
pound Gorilla’s in the midst… or finding new ways to pro-actively, vertically integrate a larger number of higher yielding buzzwords in to our collective intellectual capital.
Unconference… there… that didn’t hurt a bit now did it.
We see this not as a challenge… but a game-changing opportunity to correlate a paradigm shift to the market with a breakthrough we have been able to engineer to seamlessly bridge any cloud based interaction with of all things, the internet of things. It truly represents the next generation of solutions for gamification.
We can offer you, the investor, this ground floor opportunity to get positioned in this pre-launch company before it goes hockey stick.
Editor’s note: The following post was written by Antony Brydon and was published on Techcrunch on August 10, 2013. I have re-blogged this post with Antony’s permission.
Antony is an entrepreneur who has raised ten seed, debt, and venture rounds for four startups in the last decade and is currently a co-founder at Directly. I got the pleasure of working with Antony at ShopWell where he served as our first CEO. He is both a wonderful mentor,friend, and expert at all things startup related Follow him on Twitter @abrydon.
Last week, my company Directly closed a $1.75 million seed round using an “inbound” approach to fundraising. In past ventures, we’d used the “outbound” approach that virtually all startups use – identifying investors, networking to coordinate calls and meetings, and working 1:1 to create demand. Our new inbound approach applied new marketing technology to crowdfunding sites to generate broad investor demand, track investor engagement, and transform the traditional and inefficient outbound fundraising process to an efficient inbound raise.
How much more efficient? In an outbound model, a strong startup is lucky to close 5 to 10 percent of investors contacted. In our inbound model, we closed 37 percent.
$1.25 million of our round came from investors we know well, including True Ventures, CrunchFund* and Toba Capital, as well as individuals we’ve worked with in the past, including Ray Lane and Esther Dyson. An additional $500,000 came through AngelList and SecondMarket via a strategic set of founders, senior executives and alumni from companies, including Dell, eBay, Facebook, Hewlett-Packard, IAC, McKinsey, Nuance, Oracle, PayPal and SAP.
This post will cover some of the things I wish I had known eight weeks ago. In it, I will: explain an inbound approach you can use in your next raise; describe tools and technologies you can set up in a few hours; and show you our detailed results, from first inbound contact to close.
Our overall approach applied the latest marketing technology and techniques to AngelList. We ran a campaign to generate inbound demand, hacked technology together for total investor awareness, and used a sales funnel to move from commitment to closing $500,000 from individual investors. Here’s how we did it, along with a few tips from our investor Gil Penchina, who helped design this approach.
RUN AN INBOUND CAMPAIGN TO GENERATE DEMAND
The first and most important thing we did was to shift the way we thought about the fundraising from “outbound” sales to “inbound” marketing designed to generate demand. Instead of reaching out to specific investors who may or may not like our business and chasing them for calls and meetings, our goal was to maximize our initial exposure and create interest from folks already interested in our space and company. Tactically, this meant:
– Starting with a credible and connected referrer (in our case, Gil)
– Focusing on categories we care about (mobile, crowdsourcing, etc.)
– Enlisting 100+ of our friends on AngelList to share our profile
– Publishing updates regularly to our followers
– Publishing new investors in the round every 1-2 days
By treating this as a campaign, we were able to create a surge that brought us to the top 10 on AngelList and ultimately helped us reach No. 1 and be featured. Over three weeks, this campaign resulted in 650 follows and 150 inbound introductions. We accepted 97 of the introductions that were from individuals we thought were a good fit and closed 36 of them — a 37 percent close rate.
It’s important to note that we didn’t stop our direct pursuit of investors we wanted in the round. We pursued institutions and individuals outside of AngelList, but we folded these efforts into the broader campaign.
TECHNOLOGY FOR TOTAL INVESTOR AWARENESS
The right tools changed the game for us with an unprecedented level of awareness and visibility into interested investors. In a sales and marketing context, you might use Marketo and Salesforce.com to push out content, track engagement, score leads, and prioritize your follow-up. In a fundraising, you can use less expensive alternatives to get the same benefits. We depended on Clearslide (and their companion mobile apps); Rapportive (as a sidebar in Gmail); Gmail, Gmail folders, Gmail canned replies; and Angie (AngelList’s companion iPhone app).
Clearslide. Clearslide is an online service for hosting sales presentations. I uploaded the first half of the investor deck to Clearslide and posted the link on AngelList. I configured the deck to require the viewer to sign in with their email address, and then activated alerts that emailed me whenever someone signed into the deck. Finally, the last page of the deck teased about new service we are releasing and prompted the reader to request an introduction or email me for more information. This alone created many of the inbound intro requests. You can see this deck in action here.
Rapportive. Rapportive is a social sidebar for Gmail. When I received these email alerts in Gmail, the Rapportive sidebar would link to the AngelList and LinkedIn profiles of the investor viewing the deck. With one or two clicks, I could learn in detail about the investor and determine if they were a fit and worth pursuing. In general, I responded most quickly to investors that had made prior investments off AngelList and individuals who had expertise in the areas we care about.
Gmail, Gmail folders, and Gmail canned replies. I drafted canned replies in Gmail to help me respond quickly to qualified investors, and I could often send them a personal note (gleaned from understanding who they were from Rapportive) and the full investor deck while they were still viewing the initial deck. Gmail folders allowed me to create individual folders for key prospects, and since I was notified each time they opened the deck, this helped me “score” them: If an investor was opening the deck frequently, their folder contained more alerts and I knew they were interested.
Angie. Angie is a companion iPhone app for AngelList and alerted me each time an investor followed the company or requested an intro. It was useful when I was on the go and away from email, helping me to follow up quickly. It also sorted tasks well and I found the stripped-down UX a good complement to the AngelList website.
The result of sewing all these technologies together is that I was able to instantly understand who was viewing the deck and reach out to them, often while they were still reviewing the materials. This allowed us to go from interest to engagement quickly.
USE A SALES FUNNEL TO MOVE FROM COMMITMENT TO CLOSE
The last important thing we did was treat the investor funnel like a sales funnel, moving prospects through five defined phases:
– Interest – 600 follows
– Engagement – 150 intro requests (we accepted 97)
– Reservation – 50 reservations
– Commitment – 40 commitments
– Close – 37 closed
Here’s what the same funnel looked like from a dollar perspective:
Because it was a funnel, we focused on yield – converting the reservations to close as efficiently as possible. We thought the “reservation” concept alone might lead to a lot of fallout (ask the maître d’ in your favorite restaurant about “no shows”), so we created a “commitment” step where we asked investors to send us complete investment information and to confirm their online reservation. This was effective: only three investors totaling 5 percent of the total dollars abandoned after making a commitment.
We also worked to minimize fallout over the weeks between initial interest and close. This meant a steady stream of updates – some delivered en masse, some delivered individually.
I didn’t go overboard. The trial versions of these services were inexpensive and took a total of two to three hours to set up and configure. And I managed the entire pipeline in Excel, even though we generally use Salesforce.com, because I needed maximum flexibility to reconfigure the spreadsheet on the fly (and because I was the only one updating the records). If you want a blank version of the spreadsheet I used, feel free to contact me.
If you’re tackling a big market with a strong team, strong investors and good early traction, AngelList can be an invaluable way to extend your round and your reach, and the right techniques and tools can transform an inefficient “outbound” fundraising exercise to an efficient “inbound” raise. Run a campaign to generate inbound demand, take advantage of the tools and technology that can give you precise visibility into investor activity, use a sales funnel to relentlessly close – and you will transform how you raise money.
I’ve always found fundraising exciting, but this is the first time it’s been fun.
*Disclosure: I am an investor in Directly.
You’ve been slaving away, creating your product and company while bearing the weight of the world on your shoulders. Now it’s time to take your company to the next level. You’ve reached out to your network for investor contacts, and now the all-important meeting with investors is booked. You have three weeks to prep. What do you do?
Investors can be tough, and you want to make sure you can roll with everything that is asked during your pitch presentation. For the novice, investor questions may seem perplexing, challenging, and hard to predict. Eventually you’ll discover there is limited universe of questions to be asked.
I have been through four fundraises, through good times and bad (see my post: 25 Ways Investors Will Reject Your Startup). I have found that while no entrepreneur has the best answer to all of the questions below, having a good prepared responses and a firm understanding of the 10 topics below make all the difference. While all of the questions below may not tie perfectly to your business (it primarily focuses on web and mobile companies), most of this applies widely and should help you prepare effectively for that pitch session.
1. Know Your Company: What You Do
This one should be a no-brainer for most founders. You essentially are the company. You live it, breathe it, and like it or not, sleep it too. In spite of this, many founders don’t have their elevator pitch streamlined. They’re too in the weeds.
There is a short window to pique the investor’s attention and the company intro is the time to do it. If you don’t grab their attention at the get-go, it’s all over. So make sure you have succinct and compelling answers to the following questions:
2. Know Your Team: Who You Have and Who You Need
Having a strong understanding of your team’s unique attributes, core strengths, and weaknesses will be critical to convey during your conversation. If you’re dealing with most smart investors, they will actually care more about the team than the technology (as strange as that sounds). In your conversation, it will be important to articulate a) why your team is uniquely positioned to win and b) that you have the self awareness to plan for hiring additional players (to fill voids in skill set and bandwidth) and c) have a sound plan of who you are going to hire, and how you are going to attract top talent. Here are some questions you should be prepared to answer:
3. Differentiation and Competitive Landscape: What Makes You Stand Out?
You are building something amazing and unique, of course! But much as you might see it that way, you need to succinctly convey this uniqueness and demonstrate how you’re going to win amongst a sea of competitors (many who have 100-1000X the resources of your team) is a challenge, but will be required to get the attention of investors. And it will be important to discuss your unique advantages over the competition. Be aware that “Why couldn’t Google just do it?” is a classic question. Here is what you need to know:
4. Product and Company Strategy: What You’re Building
Many founders are great at thinking big and have a clear vision of where their startup will be in five years and billions of dollars later. What makes the difference is whether you have a strong product/company strategy to tactically get there. One worthwhile exercise is to lay out a release roadmap of key initiatives (by quarter). Ask yourself, is there logic to the staging of the company and product initiatives? Are key metrics assumptions, resourcing, and value appreciation milestones baked into the plan? This will further substantiate your raise amount and your financial assumptions. Here are some more questions to challenge you on this subject:
5. Acquisition and Activation: If You Build It, How Will They Come?
You may have the best product in the world, but unless you can convince people to use it, no one will care. Having a clear strategy for driving acquisition and activation is critical to getting users in an efficient manner. Don’t worry if you don’t know exactly how you plan to get to 10 million users. What’s important is that you have a clear sense of how you are chipping away at the challenge by showing metrics focusing on optimization of visits, then signups, then active users, and eventually monetize-able users.
Be able to easily explain the logic of your process in order to reassure investors. And you should have your current metrics locked in your mind to show you are on top of your data. Here are some questions you will hear on the subject:
6. Engagement: What Will People Do With Your Product Once They Arrive?
Do you have 5 million visitors who only visit one page and bounce, or do you have 10 thousand rabid users whose visits last more than 28 minutes per session? Each product/company has different ways they engage users and the optimization of your product can vary. Talk about how you engage your users to maximize value. Value can be calculated in a variety of ways (user utility, lifetime value, revenue/visit). Describe what engagement you are optimizing for, where you are today, and how you will continue to optimize this metric. Here are some questions you can expect:
7. Retention: After They Have Come and Gone, Will They Return?
Investors tend to have an interest in the lifetime value of your users. For many companies, the more the user visits, the more that can be made. If you are paying for users, ideally you can show that you make more per user than you spend to acquire them. Nonetheless, knowing how you measure retention and a grasp on your plans to improve this metric (in relation to your lifetime user value) will help you greatly on the topic of retention. Here are some questions to test your knowledge:
What is your daily active users / monthly active user ratio for both registered cohort and all visitors? – (many VCs have jumped on the bandwagon and ask this question because Andrew Chen mentioned it on Techcrunch)
8. Revenue: How are You Going to Create a $Billion Business?
Don’t stroll into an investor’s office without a monetization strategy. Most likely, you are not Instagram. Some of the largest value appreciation milestones you can plan for include initial substantive revenue, positive unit economics (making more per user than you spend to acquire them), and the holy grail - profitability. Separately, it will be good paint the picture of how big your business can be and where the revenue will come from (your customers). Here are the questions you will be asked:
Funding is one of the last topics discussed in a typical investor meeting. You are almost through. Having a firm grasp on what you want to raise (and how long it lasts), how you plan to use the money, and the key milestones you will achieve are very important. If you have done your homework elsewhere (financial model, hiring plan, company strategy) the numbers here should roll right onto the page. Here are the questions you will get from investors on the topic of funding:
10. Know Yourself
I have seen countless Quora questions asking about what to wear, how to act, and what to do to impress investors. The most important thing you should know and be comfortable with is yourself. Know your strengths and also acknowledge your weaknesses. Note that nobody can do everything well, and you are most likely already extraordinary. Make sure to convey your infectious enthusiasm and passion. This will matter more than a perfectly polished “presentation.”
I end this post with my favorite presentation from Dave McClure (Master Chief at 500 Startups): Startup Viagra – How to Pitch a VC.Now that you know the questions you will be asked, this is a fantastic distillation of how to build your pitch deck.
Ask not what you can do for your Board – Ask what your Board of Directors can do for your company.
It sure seems like everyone in finance I know all of a sudden wants to do a startup. They may miss their pay once on this side of the grassy field.
Being a startup founder ruins you. You can’t have a real job ever again.
Focusing on your core strength applies to both fitness and startups.