PD Reporter curates a weekly selection of exclusive interviews with early-stage founders and VC firms. Read by start-up founders, VCs, early-stage employees, and tech PR professionals. Sign up today.
Recent Startup Funding Announcements 💰
US— San Francisco, New York
Simple Habit (Yunha Kim, CEO)
Simple Habit, a San Francisco-based daily stress relief platform for busy people, raised $10m in Series A funding last month.
Recommended rule to live by: Schedule email blocks. Also recently started using Superhuman and encourage my team to use it as well.
Recommended book: For work, "Creativity Inc." by Amy Wallace and Edwin Catmulll. For life, "Man's Search for Meaning" by Viktor Frankl.
Thoughts on work-life balance: Self-care is critical. I meditate at least once every day. As a boss, leader and team member, I am more alert, focused and equipped to handle the hundreds of unexpected fires that happen at a startup.
How long did the round take to close: We began rigorously preparing this summer. We spent about a month raising. Altogether, it was a 4-5 month process.
Length of relationship with lead investor: Foundation Capital invested in Simple Habit seed round. I met our Series A partner, Steve Vassallo, when I was working out of their office when we were just getting Simple Habit off the ground.
What capital will be used for: Our first few years, we focused on building our library of content and the interface to deliver that content. We also focused on driving strong WOM growth. We'll use this new capital to build our team, expand into new content verticals, improve our recommendation system and scale how we get information from users on what they want.
Seems as though the process of raising money isn’t efficient. Your thoughts: The process of raising was a healthy opportunity to check-in as a team and company. The planning process encouraged my team and me to step back, focus on our long-term vision, and identify both strategically and operationally how we were going to make this vision happen, starting today. Also, I think it's important to not make a rushed decision. This investor will be a longterm partner. It’s almost like a marriage, as long as the company exists, they are your partner in this journey. It’s not just about money but making sure you have similar values. You’re also interviewing them, and figuring out a good fit usually takes time.
Total amount raised to date: USD $12.8 million.
Macro trends: I think audio is going to be huge in the next few years. Society’s busy, on-the-go lifestyles coupled with the increasing popularity of Google Home, Amazon Home, Airpods, etc. means we are living in a time where humans are increasingly digesting more and more audio content. As an audio content company, we're excited to be in this space right now.
Ezra (Emi Gal, cofounder and CEO)
Ezra, a NYC-based startup creating a new way to screen for cancer, announced a $4M seed round in November.
Recommended rule to live by: OKRs (objective and key results) planning for the company, by far. The methodology was created by Andy Grove at Intel and it ensures everyone in the company is aligned to a common set of goals. Personally, I plan my life in decades and each year I review my 10-year plan and make a detailed plan for the year. I then review my yearly plan each month, make a list of objectives for the month. Following that, I make a plan each week to achieve my monthly objectives. Yes, I’m a bit OCD about it.
Recommended book: High Output Management, by Andy Grove, is my favorite business book ever written.
Thoughts on work-life balance: I always make it home for dinner with my wife. I believe in work-life harmony, rather than balance. Balance implies that there’s some trade-off between the two. I have found that you can actually excel at work when you’re happy at home, and vice versa.
How long did the round take to close: The funding process took approximately three to four months (from first meeting, to money in the bank). Because I had started and sold a startup previously, I had a network of investors that who I was able to reconnect with regarding Ezra.
How many firms did you speak with and how many term-sheets: I spoke to about 40 investors and we got two term-sheets.
Length of relationship with lead investor: Accomplice was an investor in my previous company, so I’ve known them for almost a decade.
What capital will be used for: The funds will be used in several ways. Our main priority over the next six months is to come out of private beta and expand to cities outside of New York. We’re also continuing to build our team here in New York and in Toronto.
Seems as though the process of raising money isn’t efficient. Your thoughts: The more traction you have, the easier it is to raise money. If you don’t have traction, then the team is the most important aspect. If you don’t have a team, well, you’ll just have to rely on your friends & family!
Total amount raised to date: We’ve raised $4M total to date. Our seed round was led by Accomplice, with additional strategic investors such as Founders Future, Credo Ventures, Seedcamp and Esther Dyson, among others.
Macro trends: Consumers are becoming more proactive about staying healthy and preventing disease, which aligns with our mission of helping everyone in the world detecting cancer early.
US — Florida
Knack (Samyr Qureshi, CEO)
Knack, a Tampa, Florida-based edtech startup, raised $1.5M in seed funding in November.
Recommended rule to live by: We're big fans of communal lunches. I'm unsure if it's a productivity hack but it is a tradition we have here!
Recommended book: There are countless business books I'd recommend, Zero to One is one we live by. But in terms of more philosophical/self-help sort of reading, one of my favorites is The Monk Who Sold His Ferrari.
How long did the round take to close: We raised this round in a couple tranches but on average it took us about 6 months to tie up each tranche.
Length of relationship with lead investor: In this round we had two leads, Charles Hudson (Precursor Ventures) had invested in our pre-seed round and doubled down in this round. We've now known him for about two years. Jeff Vinik we have known for a few months.
Comment on valuation after the round: We prefer not to disclose this sort of information though a typical valuation for a seed round (launched product, paying customers, decent engagement) is usually under $8M.
What capital will be used for: It's heavily going towards sales and marketing as well as engineering hires.
Seems as though the process of raising money isn’t efficient. Your thoughts: It's the nature of the beast. There's no real shortcut or hack, you really have to make it your number one priority for at least 4-6 months and focus on getting as many high impact meetings scheduled with best-fit funds/investors.
Total amount raised to date: About $2M.
Competitive landscape: There are a lot of players in the tutoring space and most are in K12 whereas we play in higher education. Within the higher ed landscape of tutoring, most are focused on the consumer play of providing tutoring to students in need. We tend to focus more on increasing campus engagement and student success with a sharing economy model of tutoring where every stakeholder wins. What's cool about our platform that we haven't seen anyone else do is the focus on developing students (and the tutor) to not only be successful in the classroom, but also for the 21st century workplace.
Macro trends: We're seeing a lot of universities place an increased emphasis on student success especially when it comes to retention and college-to-career outcomes. Many states are moving to a performance-based funding metric system which only furthers their need to invest in technologies and methodologies that bolster student success. Knack is a tool for universities to boost student performance and skills development and goes hand-in-hand to augment the institutions' existing support services ensuring they meet or exceed funding metrics.
Isara Corp. (Scott Totzke, CEO & Co-founder)
Isara Corp., a Waterloo, Ontario, Canada-based provider of agile quantum-safe security solutions, raised $10m in Series A funding last month.
Recommended rule to live by: From a company perspective, at this stage it has been a relentless focus on our core vision. I think that sounds pretty cliché but given the team that we’ve assembled it would be easy to take on contract work to do a variety of unrelated projects that wouldn’t help advance our vision for ISARA. We’ve been able to turn down this work and maintain our focus on building quantum safe security solutions. If we had accepted some of these other offers that would have created a significant distraction for the company and there is no way we would be in the place we are today. For me, putting the emphasis on prioritizing my well-being has been essential – meditation, morning workouts to start the day off and making sure that vacations are away from the office and unplugged are critical to managing the day-to-day stress associated with building a company from the ground up.
Recommended book: Jim Collins’ Good To Great. It really forms the cornerstone for his series on books that examine how to build sustainable greatness in an organizations. His follow on work builds on this research. Understanding how some leaders and organizations make deliberate choices to build great organizations is fascinating and clearly it is sometimes it requires levels of organizational courage to understand both what to do and what not to do. The other recommendation that I make is Robin Sharma’s The Saint, The Surfer and The CEO. Like Collin’s, Sharma has a series of books but this one stands out to me as common sense lessons on building balance in your life and by extension your organization.
Thoughts on work-life balance: Work/life balance, has been a theme at ISARA since day one and we strive to ensure we live up to that promise. It is part of every discussion we have with candidates. We may be a young company but we are a mature one with many of our team having the learned from the cultures where hours in the office has been equated to productivity and dedication. Countless studies have shown how this is not the case and it is not the environment that we have been building at ISARA.
How long did the round take to close: Before we even started the process we thought about this for a year with lots of research into the venture capital market. After that, it was almost another year of discussions with various firms to find that fit.
How many firms did you speak with: I spoke to around 80 firms throughout the process that got to various phases.
Length of relationship with lead investor: Between our initial meeting on closing the investment was almost a year to the day.
What capital will be used for: It will go towards further establishing our position as the leader in the quantum-safe security market. It’ll go towards meaningful growth on the front end of the business to continue to provide exceptional support, expertise and innovative solutions for our partners. Also, as this market matures, we know how important it is to deeply understand the needs and challenges of today’s cybersecurity teams. We’ll continue to do this through our world-class research and development team and our standards-based approach to interoperability.
Seems as though the process of raising money isn’t efficient. Your thoughts: I don’t think that you can compress this much for your first raise. You might get lucky and find a fit in the first meeting but even after that you have a couple months of due diligence before it would close. I see fit and alignment as the critical success factors for any partnership like this so there are no shortcuts to success. That said, I do think that the follow on rounds may be a little bit more straightforward. Many of the potential investors that we talked to are interested in the next round and we have already established an ongoing dialogue with these firms so that when the time comes for a B round we will already have a number of potential investors that are quite familiar with our company and progress.
Total amount raised to date: All in we have currently raised USD 22.5m between our seed and Series A rounds.
Macro trends: The biggest one we see is crystallization of the timeline surrounding large scale quantum computers. As an industry we are beyond solving the basic science problems around being able to build the fundamental quantum computing platforms; we are now looking at how we solve complex engineering problems to scale these systems. I think we can expect to see an acceleration of innovation here that will result in a much clearer timeline of when quantum computers will be a threat to everything that we protect with public key cryptography today. Fixing this will be a massive technology challenge which means we need to start the process now. Fortunately, ISARA has been purpose built to provide standards-based and broadly applicable technology that is designed to mitigate this threat.
Technically Compatible (Mike Rohan, CEO)
Technically Compatible, a Sunderland, UK-based recruitment technology company, secured £500k in funding this month.
Recommended book: I tend to listen to podcasts when in the car or travelling, my time to read business books is limited but one excellent book I finished recently was ‘Winners’ by Alastair Campbell. A great read that lifted the lid on people from the worlds of business and sport to give an insight into how they have succeeded – whether it be in business, politics or sport.
Thoughts on work-life balance: We employ wonderful humans and empower them to deliver a quality output for us. If someone wants to work from home, flex their hours to suit their lifestyle or make adjustments because of other family responsibilities then we make it happen. Happy people who feel valued do amazing things for their employer.
How long did the round take to close: I first met with our new VC back in November 2017, we started serious discussions in May 2018 and from there it took 4 months to close out.
How many firms did you speak with: I probably spoke to 30 investors, took in various means of raising funds including crowd funding and syndicates but once the conversation with Mercia started there was only going to be one winner. I had a good idea of what I wanted from day one, an investor who was good for now and could lead our next couple of rounds if desired – Mercia certainly fit that bill.
What capital will be used for: Growth is top of the agenda for 2019. That means delighting our customers though product and service enhancements, hiring smart people to spread the word and talented sales people to deal with the pipeline of customers who want to change the way they recruit for tech roles.
Seems as though the process of raising money isn’t efficient. Your thoughts: The whole process of raising funds seems really inefficient for the VC and for companies. I have a product I want to sell, I know there are certain VCs that want to buy my product but there is no tech enabled medium to enable us to find each other based on criteria such as do I want a hands on or hands off VC, do they want to invest in a company in my sector in my location, what stage do they tend to invest at. Getting investment can rely on being seen at a pitch event, an intro from a mutual contact or factors such as being noticed through PR – all far too prone to chance and time consuming for both parties.
Length of time you knew lead investor prior to the round: 12 months, but they had been monitoring us since we founded in 2014.
Macro trends: Hiring tech talent is becoming increasingly difficult, as demand rises and as supply stays broadly static. In a world where there are not enough candidates, we start our recruitment process with a list of reasons why to reject candidates without even speaking to them – aka the job description.
Employers sift talent out of their pipeline rather than making an effort to sift it in – which is counterintuitive given that the shortage they face in the labour market. Many switched on employers have woken up to this and are going down a ‘grow your own’ route whether that be taking on candidates who have been to coder bootcamps, upskilling existing staff or training people with potential from scratch. In the UK the Apprenticeship Levy has been quite effective in kick starting this revolution.
Accessing talent who have taken atypical routes into their chosen career is going to be the norm in the future however some companies struggle to recruit from this pool because they lack an objective measure of whether a candidate fits their ideal profile. The world needs an enabler that links potential to opportunity, that enables employers to build and access a tech talent community that ensures nobody’s potential goes unfulfilled.
eAgronom (Stenver Jerkku, founder and COO)
eAgronom, a Tartu, Estonia-based agtech startup, raised €1m in seed funding
Recommended rule to live by: Focus. We instruct everybody to block out focus times in calendar and keep meetings 30 minutes. Also, open door hour, where we block special times in calendar for random interruptions, slack and email. You don't have to and shouldn't have to respond and see every email and slack message. Do it 2-3 times a day and you will get more done with less time. With these 2 simple tricks, we have seen that people can be twice as productive. Answering every email and slack immediately is a massive productivity drain.
Thoughts on work-life balance: We encourage people to take a vacation anytime we see that somebody is starting to burn out. We also encourage people to rest at least one day a week, work out and sleep well. Those are the things that can help a person stay sustainably productive for long periods of time.
How long did the round take to close: We actively raised the round for 3 months by meeting multiple investors a day, travelling around Europe and leveraging connection. We then spent 5 months to close the deal through due diligence, sending extra data, etc. The last 2 months we only spent around 2-8 hours a week on fundraising.
How many firms did you speak with: more than 100 investors.
Comment on valuation after the round: We feel the valuation was fair and now we need to focus on delivering the results for it as well.
Seems as though the process of raising money isn’t efficient. Your thoughts: The next time I do this, I could certainly do it faster with these simple tips:
* Don't raise in the summer - everybody is having a vacation then. July-August is the worst - this was the main reason it took us 8 months total, instead of 3 months. I heard late December to early January has the same problem
* Prepare all your financials, calculate ARPU, CAC, LTV, MMR and all those other metrics investors are going to ask anyway before time. Put them into easy-to-understand documents and learn them by heart.
* Talk to as many other founders as possible - they will help you find the right people and intros. Founders are a lot better time-investment then VC-s, as all founders know some VC-s and they don't have vested interest when talking to you. Global Genome Research Survey shows that the most successful startups have the most founder connections as well. That's one of the reasons why
* Get a lead investor on-board ASAP. He can mentor and help you get the other investors fast
Length of time you knew lead investor prior to the round: Before round? Not at all. We met and in 3 weeks he decided to invest.
Total amount raised to date: Around 2M euros, 500K of which is straight from our own customers - farmers - who believe in us.
Competitive landscape: We position ourselves as a grain farm management tool. We don't worry about cattle, vegetable or grape farmers. Focus, is very important in our stage. Most of our competitors try to catch all the farming types, but I think that's a mistake; the problems are very different for all of these farmers. One of the biggest competitors we have, for example, tries to target grain farmers as well, but its software is really optimized for grape farmers. By spending time on grain farmers they will only spread their development and sales resources thin while bringing an average product to market.
Macro trends: A lot of our customers buy the program because they are preparing to give the farm over to their son. They understand that their son will never want to take over the farm if it's run on pen and paper. The technology has changed the world. We take advantage of that with our focus, because we focus only on grain farmers, our software follows the habits they have with pen and paper - it's a very small leap from the paper to the computer with our software. We work hard towards ensuring that. Our average user is 50 years old and we need to ensure that it's easy to use even for them.