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Today we are joined by Dan Tyre, a Director and early employee at HubSpot and a prolific angel investor and startup coach. 

Nathan:

Hi Dan, great to meet you and thanks for joining me today. Why don't we start with your background…give me your 20 second bio or however you like to describe yourself. 

Dan:

Cool. I'm the luckiest guy in the world. Stuff happens to me that doesn't happen to normal to people. I worked my way through college selling books door-to-door. I know that makes me sound like your grandfather, but I graduated Colgate University in 1980. I was a bass player in a heavy metal rock and roll band, which was kind of fun.

Nathan:

Very cool. I played bass in a "death metal" band. So much fun. 

Dan:

Then I started my professional career. My first startup was a company called Businessland. I think you're too young to remember Businessland. BUSL was the symbol on the NASDAQ. IPO'd I think in 1981. I was one of the first hundred employees. I was employee number three in the Boston area. It was my first startup before startups were big and over the next nine years, that went to a billion-and-a-half dollars, IPO'd in the second year. It was amazing. It was selling computers when everyone was buying computers. It was an extraordinary experience. I was one of their turn around experts and went all over the country helping to manage higher revenue numbers and profitability. 

 

My last position at Businessland, I was an Area Director in the New York metropolitan area, responsible for a quarter of a billion dollars in distribution, software development, training, network engineering, and support to the world's biggest companies and it was a lot of fun. My second startup, I started in my dining room. We went to $5 million based in Needham, Massachusetts. It was around collaboration software then I sold it to a Phoenix-based company in 1997. That's how I got to Phoenix. The combined companies were $15 million and grew to $25 million, raised $30 million in venture capital and scaled the company. I was there for a combined total of a decade.

 

I bought their training division and they went bankrupt. I take full responsibility. There was a variety of different things but it was a very seminal point in my business education. Putting a company through receivership was very, very hard but made me a better business person. My fourth startup was Groove Networks founded by Ray Ozzie and that got bought up by Microsoft. I was there for a combined, I think five or six years. Was one of the first, probably 100 employees and ran the organization from LA to Arkansas. The Vice President of Sales for Groove at the time was guy by the name of Brian Halligan.

 

When we sold to Microsoft, he went to Sloane School. I had to work for Microsoft for a year. Then when he started HubSpot he called me and said, "I want you to be one of our first 10 employees." I go, "Why?" He's like, "You're a great startup guy. You've got tons of energy. You have sales and marketing skills." I go, "I live in Scottsdale, Arizona." He goes, "Those are just details. Ask your wife." I did and I joined the company as the first salesperson, and of course HubSpot 10 years later is 1500 employees, sold in 90 countries across the world and traded on the NYSE. It's been a very incredible and extraordinary journey, both for me as well as my wife.

Nathan:

I know it wasn't but you almost make it sound too easy.

Dan:

Not at all. I'm the luckiest guy on Earth. Remember, I played a very small role at HubSpot. I wasn't a founder. I was the very first salesperson and worked especially with Mark Roberge. I think I was the first person that wasn't an MIT or Sloan School grad and it was a lot a work. A ton of work but they're the smartest people in the world. The greatest thing and the thing I'm most proud about HubSpot is just the transition. Probably the biggest transition in sales and marketing in the last 50 years.

 

As a 58 year old guy, I was there at the very beginning for PCs. Now at the end, this inbound marketing trand is extraordinarily transformational for every single company. Right now, I think we have 20,000 customers or something like that. It's a superior way for people to sell and market. It's specifically critical for scale-up companies. Part of my responsibilities now is to work with people like you, HubSpot for startups because we're Startup Nation. In the last two years, I've spent a little bit less time in Boston, or in Cambridge, a little bit more time on the road and spent a fair amount of time here in Arizona, and then started to either mentor or advise or serve on the board of directors, or invest in startup companies.

 

It's Startup Nation everywhere across the world. It's not so much starting a company that's a challenge now, it's scaling a company. When I did my second startup, I had $400,000, 250,000 of it went to taxes, Microsoft, and Dell just so I could have email. You can get free email for $400 a year. It's much, much different and that bodes super well for the economy, for people's individual business experience, it bodes well for the continuation of businesses and for innovation. I'm a little concerned that part of it is based on the low-interest rates, but it's super exciting to be a part of that in all different capacities, here in Arizona and across the world.

Nathan:

Very interesting. Let's knock out a few of these questions. Where in Arizona are you?

Dan:

I live in a place called Paradise Valley which is an enclave of Scottsdale where a lot of the athletes live so it's pretty well known. It's a beautiful area and the general Phoenix/Scottsdale area, it's like Cambridge/Boston. It's essentially the same kind of locality. I've lived here for 18 years since the ALI acquisition from InfoImage and I kind of like it. Other than commuting for seven years every other week back to Boston, it's a great place to live.

Nathan:

Tell me what the Arizona startup ecosystem looks like. I hear occasional things but let me get your color commentary on it.

Dan:

It's freaking awesome. We just had Steve Case (ed. note: AOL Founder and now VC) here on Friday. When I first came back to Arizona to cover a territory for HubSpot. I think it was 2014, and I couldn't understand why we didn't have the bug. Everybody told me, "You can't raise money in Arizona." Everybody told me, "You got to go to Silicon Valley." We lost a lot of startup companies to other places across the United States." I'm going, "That's really weird. I wonder why that is?" I started going out and asking everybody I knew and connecting with all these people why that was. 

 

I realized that if you start a company in Silicon Valley or in San Francisco, it's like an assembly line. There are lots of people who mentor you, there's a process. At least in Boston, what happens is you got to Harvard or MIT or one of the really good colleges. You're marketing professor says, "That's kind of interesting. We'll help you write a business plan." They hook you up with some mentors. Then if you're successful, you move to a proof of concept, move to a proof of a business model, and then you can scale to your [inaudible 00:12:32]. It's like an assembly line.

 

The assembly line was here in Arizona, but it was really hard to find. I thought I had to build it or we had to build it. We didn't have to build it. It was here. The people here for the last 30 years were trying really hard to do it. In the last 3 years, it's been extraordinary. When I first started there would be like 30 people showing up to the events. Now, with Steve Case from AOL, Rise of the West. You know Rise of the West?

Nathan:

I do. I was in Denver on Wednesday at the Denver stop, I saw him speak to the Denver crowd. 

Dan:

Nice. 

Nathan:

Yeah, I totally got it. 

Dan:

He's a super guy. He came to Phoenix. We have 1,000 people. I don't know how many people went to Denver event. There were 1,000 people who all came together at the Talking Stick Arena to hear more great companies present. I also get to to hear pitch points and help coach them and now we routinely sellout the Phoenix Adventure Madness. We have a great educational system at ASU and U of A in our backyard. It's diverse. It used to be a bunch of old people talking about real estate.

 

We have tons of women-lead companies. There's med-tech. There's regular technology. Strong in ed-tech, their general services and based on I think the innovation of the mass printers, based on the availability of mentors, and maybe to a certain extent, the cost of living, it is absolutely Startup Nation. What you see constantly, some of these great companies who are starting and some of these great companies who are now starting to scale. The old adage was you couldn't raise money in Arizona. Now it's like anyplace else. There's tons of extra capital for people who have strong business models and teams.

Nathan:

Good. There's a good Angel scene there? Because that's ...

Dan:

I'm going to say it's great. It's great. It is so much fun. There's 300 or 400 people who have made investments in these companies. I see a lot of the deal-flow through Desert Angels in Tucson, and ATIF (Arizona Tech Investors) which is here. There's Grand Canyon Angels, there's Canal Partners, there's Gray Hawk Capital. All of these. There's a founder's fund, the Infusion Soft guys. We're now starting to see people outside of Arizona come to play that arbitrage of people who are outside of Silicon Valley because innovation doesn't have to happen in a certain geographic area.

 

There was a company by the name of ClicData; I actually serve on their Board of Directors. They are moving to Phoenix because they said, "Listen. If we move to Silicon Valley, larger companies are going to poach our development talent in about a minute and a half." In Arizona, there's good talent and we're kind of a bigger fish in a small pond and we're happy to do it. Now, there are companies like Tuft and Needles. Do you know Tuft and Needles? 

Nathan:

No. What is it?

Dan:

Tuft and Needles. It's a mattress company. These guys are from, I think they're from Pennsylvania. They went to startup in Silicon Valley. They decided it wasn't a good fit. Came here. I had an experience of trying to buy a mattress at a mattress store. Now they're scaling to a tens of million of dollars company with no VC, based around customer service. They're a huge Arizona success and there's tons more. Pinnacle Transplant is another. There are these companies now that are moving from the startup stage to moving to the scale up stage. My experience is that once you start getting those wins can have a few world leaders like GoDaddy or LifeLock. You're going to hopefully have lots of stronger scale-ups, companies that move to $10 or $30 or $50 million. Once you have that completed ecosystem, human nature takes over, people get a little ticked off, they get fired, they want to start their own deal. Then you have that really healthy business mix that you see in some of our leading areas across the United States. 

Nathan:

Great, great. You mentioned a couple of the Angel groups, Desert Angels and you said a couple more that were a little too quick for me 

Dan:

ATIF they call it. Arizona Technology Investor Forum I think it is that Jim Galoopa, he runs it here in Phoenix. There's Grand Canyon Angels. That's a spin-out from Grand Canyon University. There's some leading VC companies that do healthcare and IT stuff. Canal Partners is one. Gray Hawk is another. 

Nathan:

Grey Hawk. Okay. 

Dan:

You're seeing many of the major VC companies starting to look at Arizona because of some of the innovation that we have going on. 

Nathan:

Cool, cool, cool. Good. Now, let's talk about ... this will probably be a very large topic but let's do it in a simple way, comparing Arizona to Boston. Obviously, Boston's more mature, but give me a little color, lay of the land of the Boston startup scene.

Dan:

I still make events in Boston fairly frequently. It's Startup Nation. Lot's of people have been through those successful startups and then they feel, I don't know if it's obligated or just incentive, to keep the ball rolling. There's companies like Crayon that does competitive intelligence in the security market. There's Tap Link, which I'm familiar with. The thing about Boston is it's a little bit further down the line then Arizona is. They had probably 10 or 15 major billion dollar companies go IPO. There's a lot more talent. It's just a little bit more baked.

 

It's pretty close to the gold standard in the United States. There's a little bit of an ego that sometimes associated with these major physical locations but it's well deserved. The reason why Silicon Valley is so successful is because these guys pioneered it. I think that goes with the territory with being successful. You see a lot of marketing companies falling out from the HubSpot beacon. You see a lot of technology companies falling out from Fidelity and from EMC and from some of those technical companies. You're starting to see a lot of security companies, based on cyber security becoming a important component of everyone's business, and Boston seems to be a hub of that sort.

Nathan:

Is there a HubSpot mafia of Angels there or is that not yet crystallized? 

Dan:

No. None of that. HubSpot has always been bigger than the actual company. Brian Halligan and Dharmesh Shah are incredible founders and we have always gone with the aesthetic of inbound, of trying to help everybody. I've been in meetings where we talk about, how can we help you manage it? It's incredibly inspiring and it comes right from Brian and Dharmesh. We've always thought that part of the role we play in the community is creating this.

 

Teaching people how to be good corporate citizens, how to run a good business model, how to manage with data, and it goes across just being myopically focused on HubSpot, but how do we raise the entire community and how do we educate our employees and our ecosystem in a way in which that we can help everybody. There are lots of senior executives who take a passionate interest as I do, in giving back to the community in some fashion, in either investing or helping, or nurturing certain companies. I would expect that that would continue. 

Nathan:

If you don't want to name names you don't have to, but are there a few HubSpot Mafia guys that are particularly active Angels in the scene or is it spread out with a lot of different guys?

Dan:

Dharmesh Shah, the HubSpot founder, started it all. He's like Buddha. He's like the nicest guy ever. He's got a huge heart. He wrote the HubSpot culture code. Speaks worldwide on the passions of being a social responsible entrepreneur. He continues to be an active investor. Mike Volpe who was our first CFO has got a pretty big footprint in investing. Yoav Shapira who was CTO for HubSpot for many years and he started multiple companies there. Mark Roberge who was our first VP of Sales and the Chief Revenue Officer and took HubSpot from zero to $100 million then wrote a book called The Sales Acceleration Formula, is into angel investing. Then periodically, I'll see Brian investing in a company, either somebody who worked at HubSpot or somebody who's a friend of HubSpot in that regard.

Nathan:

Brian. Who's Brian?

Dan:

Brian Halligan is the CEO. 

Dan:

Also, all of that, I think it's just we just feel it's part of the process. That you get to a level of success and it's not necessarily for the financial. Sometimes it is for the financial remuneration but mainly it's because it's the right thing to do and helping people out. The single most important thing that you can do for a first time founder is to try to help them scale so that mentorship for advice or board level stuff is pretty important.

Nathan:

Cool. This is great 

Dan:

Yep. They're all praised and fine. They're all senior Hubspot executives. They've all been very active. Dharmesh probably the most and for the longest period of time.

Nathan:

Yeah, I've seen him once or twice speak at events and he's great. 

Dan:

Yes. He's not your typical business person. He's got a huge heart. He wants to help and in the early days of HubSpot we said, "We want to do what's right for our customers." We thought that there was a huge opportunity. I didn't really understand it when they first explained it to me. I was like, "Wait a second. You mean by producing content and helping your clients, your prospects, you can get them to get better visibility for search?" Brian said, "Yeah." I go, "There's not a CEO in America that won't buy it. That's huge." He's going, "Well, that's what we're hoping."

 

Then I would jump on the call and I would talk with people in 2007 and go, "I want to talk to you about inbound marketing." They're like, "What? What is that? It's like Call Center?" They'd squinch up their nose. Make a face. I'm like, "No, no, no, no. It's like creating content so that you can educate your buying demographic so when they're ready to buy, they'll consider you." People are like, "Well, does it work?" I'm like in 2007, "I think so," but now in 2016, we've got all the daily and all the facts. We know it works. We know it lowers your sales and marketing costs. We know it helps you scale. We know that is amongst the most critical functions you can have. Sales and marketing. Just marketing. I spent a fair amount of my time talking about the alignment of sales and marketing, how critical that is to the scale of the universe.

Nathan:

Moving on a little bit. What kind of advice do you dole out to a first time founders and what kind of advice is often ignored? 

Dan:

That's good. Number one, I'm a guy who is a big believer as hustling is a competitive advantage. Lots of people are enamored with startup life and they think it's just a smaller version of corporate life and as you know, nothing is further from the truth. If you're really going to push, you're essentially going to have 8 years of your life for every startup you do. It has a huge impact on your personal life, your family life, your significant other. I always ask people what the goal of the company? In fact I think I might have sent it to you, there's lots of entrepreneurs approach me and say, "What's your secret sauce? What do I do? What are the first things?"

 

I created a 10 page questionnaire and it's called, ”Creating a Successful Startup in 2016”. I asked them 10 questions. I did it because number one, I wanted to understand like yourself, the motivations of entrepreneurial folks. I don't want to assume that people just want to grow a big company. I want to understand what they're in it for. My friend Sidney Pesca is into the smart brain and aging. The reason she started a company is because her dad had Alzheimer's and she wanted to create a place where caregivers could provide better contact. I tell first time founders, be prepared that it's going to be very, very hard. Be prepared to take 8 years to build a big company.

 

Next thing I do is set goals. I tell them to set goals. Where are you going to be in a year? Where are you going to be in three years? Then work backwards, get three page business plan that says, "This is how I'm going to meet those goals." Lot's of people, they have difficulty taking that goal and translating that into a spreadsheet that can be reviewed by an advisor to determine if you can do it or not. I'm a big believer in saying, "All right. You're going to put a stake in the ground. You have to figure out how much time, effort, and money it's going to require you to, first of all prove that concept.”

 

At the very beginning, once you're past the ideation stage, you have to prove the concept. How will you prove the concept? They often frequently say, "We've already proven the concept." I go, "Yeah, how did you prove it?" "We got eight customers and we've only lost one customer." I go, "No. The way you prove the concept is you get 100 customers. You get 98% sure and you have product uptime 99%. You use the other 16 things or 25 things or 60 things you need to prove that you proved the concept, and you go out and you do that for no money. Just friends and family with a ridiculously low amount of money or competition or something like that.

 

You should be able to do it for $100K unless it's a boil the ocean kind of study. Then once you've proven the concept, we can introduce you to tons of people like Cbased VC or other Angel investors where the next stage is you want to prove the business model. Number one, you want to prove that there's a concept there that people are willing to put their hard earned knowledge down. The second thing is you want to prove you can put the business model together and the business model makes sense. The third process was usually venture capital comes in. That is scaling the business model.

 

Lots of time, where Arizona got caught up in the past is you can't raise $6 million in Arizona. The answer was you couldn't because you didn't prove the concept first, but if you take $40 grand or $80 grand and prove the concept, and then take a million or a million-and-a-half and prove the business model, then people would be throwing money at you. Campus Logic raised $7.5 million in 2016. There are tons of companies like Evisit, that did the same thing. Tons of companies that are very, very well funded once they get to the right stage. Of course, the goal is to match the growth of the organization with the size of the capital that you need at each stage of that process.

Nathan:

Good. That's good.

Dan:

The advice that I give to everybody that is frequently, routinely ignored is, never miss you number. I'm a sales and marketing guy. In HubSpot, in our first 27 months, we never missed a number ever. Guys were all over me constantly. My boss was great about it. Mark Roberge. He's smartest guy in the world. He was the greatest Vice President of Sales because he wasn't a classic sales guy. You know how some of the sales guys are a little bit mean and pushy. He wasn't like that. He was an engineering executive, ran his own company, and he said, "We have to apply engineering principles to sales." I'm like, "Good luck with that." Then he did it and then he wrote a book about it called The Sales Acceleration Formula.

 

The only reason he and I are still alive is because we would do anything to hit our numbers. We never missed our number. I tell people, "Don't go home until you hit your number." They go, "What are you talking about?" I go, "There's no vacation. You have to work Saturday. You have to work Sunday. You have to do whatever it takes. You can't miss your number." I'm not sure unless you've been through a successful startup like Businessland or HubSpot that people really understand that. Once you're a little bit further along the line it's a little bit different but I think if you're trying to raise capital, get quality employees, build a corporate culture of over achievements. Hitting your number is a pretty important component.

Nathan:

This is great. This is so true. 

Dan:

Mm-hmm (affirmative). When I cycle in and I talk with people. I go, "How did you do last month?" "Oh, I got up to 94% or something like that." I'm like, "Really? You couldn't get to 100%? Did you give me everything you had?" It happens. Sometimes it doesn't happen like that, but I think Gary B the last the last conversation. He was like, "85% of you guys shouldn't even be here. You're not dedicated all out to do whatever it takes." I feel like part of my role is to tell people this is going to be really really hard. You've got to find a way. The good entrepreneurs always find a way. If you can do it, great. If you can't we'll help. You still have to find a way. 

Nathan:

Interesting. I have two gals that work for me doing sales. They're wonderful, so wonderful but not really sales people by nature. They were interns. They're very committed. I'm trying to take what you just said, I'm trying to burn this into their brains. It's hard. 

Dan:

Yes, you've got to sit down with them and you've got to say, "Here's the deal. There are companies that hit their numbers and there are companies that don't. We want to be one of the ones that hit our numbers and this is why. There's a huge divide between the people that make excuses and the people that constantly hit it." You can see that in the entrepreneurs. If they're not hitting their numbers it's either because their business model isn't particularly good or they're not giving it the extra juice that they need.

Nathan:

Good. I'm going to write that section in bold, all caps.

Dan:

It's just one of those things. It's really hard to teach. Either somebody has it or not, but it has to come from the top. You have to explain to people this is critically important. The other thing is, these businesses in 2016 they happened very, very quickly. You're either scaling very quickly or you get into that holding pattern. It's much more difficult, much more complex to hold onto your people, to engage clients. It's all done in an accelerated fashion. You've got 18 months to hit the ground running. Then if you're not showing traction, you've got to question whether there's a business there. 

 

What we teach people in Arizona is the reason we want to do it the way we just described is if you can't get the concept to work we don't want you to spend four years trying to bang your head against the wall. If you can get the right team, run like crazy. Do it in 18 months and move to the proving of the business model. Then maybe it's not the right business model. What we love about the Silicon Valley Model is you guys wash out it's no big deal. You just move on to whatever’s next. Which I can appreciate. It's the right attitude. I think lots of people in Silicon Valley have a much better concept of failure then in other places.

Nathan:

Especially when I talk to European entrepreneurs it's such a different culture about failure there.

Dan:

Excruciating, it's crushing for multiple generations. In Silicon Valley if your company goes belly up on Friday, you're looking for a job on Monday. It's just one of those things. I think to a certain extent you have to take personal responsibility, it's not a very healthy kind of thing. 

Nathan:

Cool. Let me crank through a couple more questions and then I’ll let you go. Are you actively investing? How many deals are year do you do? How do you make the decision to invest in a deal? 

Dan:

Yes. I've got an investment partner in my buddy, Mario Martinez known as a Super Angel. He started a company Advantage 360 and grew it to $80 million. He's made investments in about 75 companies. He and I met when I started doing angel investing and we syndicate some deals. What we really look for is try to find that special entrepreneur. I get approached by lots of people based on my public speaking visibility and activity here in Phoenix. I do office hours every other week at a local restaurant by the name of The Henry. It's at 44th and Camel Back. 

 

It’s run by a restaurant entrepreneur by the name of Sam Fox. He has WiFi in his place and it's located in Central Phoenix. He lets me sit on a bench and every hour during the day I have five or six hour sessions. Anybody who wants to get on my calendar I'm happy to speak with them and give them advice. I get a lot of visibility into what's going on. Some people I can help. Some people I can't. I view it as part of my responsibility as a successful member of the Arizona and the world business community. 

 

I think I'll probably do five deals in the next 12 months. That's down from 10 in 2016. I'm getting a little busy. I still work a lot and I tend to not be a very good passive investor. I'm a much better active investor. I've got lots of experience that I think I can help. I try to chose the investments that I can help and that are in my wheelhouse. I like helping entrepreneurs accomplish their goals. Very entrepreneur focused, I don't care where you are. I have companies in the south like, Joinforge here in Arizona, and Crowd Mics. ClicData we talked about. Picmonic is somebody I'm working with now.

Nathan:

Tell me how you work with them. 

Dan:

For example, Joinforge. The CEO is Stacey Ferreira. She's an Arizona entrepreneur, second time entrepreneur. She's got an app that helps restaurants and retail stores manage people's payroll and balance the right number of employees to manage the store. That's pretty good. Then Ron Robertson at Picmonic. Picmonic is pictures to help you improve your memory. It has also had a pretty fast start. It helps people to remember either medical phrases or nursing phrases so they can get better scores on the exams.

Nathan:

Interesting. Pretty cool. Those are good. Joinforge, Crowd Mics and Picmonic. 

Dan:

There's another one by the name of ReplyBuy, ReplyBuy is interesting in that they do just in time tickets with texting. There's all these apps out there where you have to sign up for an app and you get information. If you sign up for the Golden State Warriors. They have 90 teams, 90 sports teams. For example, let’s say you want to get tickets to an upcoming Warrior game. It turns out that the Warriors have to keep certain tickets available until the day of the game. They're pretty valuable tickets. Have you ever been to a Warriors game? 

Nathan:

I have, yeah. It was fun. 

Dan:

They are fun. Did you sit close?

Nathan:

No. Actually I've only been to one recently and Steph Curry was out with some ankle sprain that day. Not close and no Steph Curry. That's how it goes.

Dan:

I'm sure. This ReplyBuy if you want to get tickets you send them a text. They'll check and see if tickets are available. They'll send you back how many you want. You text them, "I want four tickets." They go and find the tickets. They supply that and they'll deliver it through your phone by text.

Nathan:

That's cool. 

Nathan:

With these companies, what was your decision making criteria? Were looking at metrics? Were you going by your gut? Is it a personal connection to the problem with these companies? How did you pick these companies?

Dan:

It's a long and arduous process. The first thing, people find me pretty frequently. I'll meet with anybody. If you get on my calendar, I'll meet with you. That's part of just giving back to the universe, to the entrepreneurial ecosystem. My role with startups, I go to a variety of different incubators and organizations. Lots of people want to talk with me about my entrepreneurial success. I meet with them and I make them fill out the questionnaire. Then I'll meet with them again. Then I'll meet with them a third time. Then I actually put together some information.

 

I'll determine if I like them or not and if they like me. You can probably tell I'm a little bit of an acquired taste. Some people love me. Some people not so much but it doesn't matter. I'm still willing to help you. Some people don't necessarily like to take a lot of direction or don't believe in my philosophy or maybe I don't have that expertise in the area they're looking for. To get that out, it's usually at least six meetings. My annual investments are usually around $25,000 a pop. People don't usually come to me for the capital. It's more about my endorsement, my advice or my mentorship. I explained to them that these are the requirements that we want.

 

We want monthly updates. We want you to follow the process. You have to have three good advisors. Ideally, somebody I know needs to be one of them. You need to listen to your advisors. After maybe six to eight meetings there's usually a point where we go, "All right, this is a company that we want to help raise money." We figured out that entrepreneurs are pretty good, and that there's a meeting of the minds. We understand what kind of company they want to build. We understand if they are first or second time founders.

Nathan:

Last question, then we can wrap up. You've been around for a while. You've seen start-ups change and funding change. What do you think the start-up funding environment will look like in five years? How will it be different? Here's your crystal ball question.

Dan:

I'm a little worried about low interest rates for an extended period of time. It's been part of the reason for Start-up Nation. People are looking for a better return. When you have low interest rates I think that it leads to that type of environment. I'm pretty excited about AngelList Syndicates. AngelList seems like a way that we can connect in different ways that is creative to the people who are really the scouts. I think there will always be access to capital for companies that follow a good process and can show proof of concept, proof of business model and then proof of scale. 

Nathan:

Do you have a syndicate? I think you mentioned you're a syndicating deal. Are you an Angel with syndicate or are you doing more?

Dan:

No. I don't. I hate to share this, it's kind of old school. I’ve got 400 names of people that have asked me, "If you invest in the company, you let me know." About four times a year I'll ping those folks and say, "All right, I'm in on this deal." They'll say, "Are you actively involved? Why are you involved with this deal?" I'll explain it to them. Helping people raise money is an essential part of the process.

Nathan:

All right sir. Thank you very much. Appreciate it. Have a good day. 

Dan:

Keep it honest. Bye.

Nathan:

Bye. 

 

 

 

Topics: angel investors, Startups

     
Nathan Beckord

Written by Nathan Beckord

Nathan Beckord is Founder and CEO of Foundersuite.com, a venture-backed startup that makes the leading CRM for raising capital. Previously, Nathan ran VentureArchetypes and served as advisor or interim CFO at dozens of startups, including Kickstarter, Clicker, Autonet, Zerply, and many more. Nathan has an MBA and CFA and is a fanatical sailor.