When Bradley Davis launched Podchaser, he didn't have connections in startups or the fundraising space. No Ivy League education, no built-in network, no uncle working as the CFO of a major company.
In fact, he didn't even know what VC stood for.
But Bradley knew he loved podcasts, and he wanted to find an online community for podcasts — a space not unlike IMDb for films, where people could rate, review, and talk about podcasts. So, after chatting about his idea on Reddit, he decided to turn Podchaser into a reality.
In this episode of How I Raised it, Bradley discussed the highs and lows of bootstrapping and then fundraising to get Podchaser off the ground — and for someone with no connections in the startup industry, those intense highs and lows would give anyone whiplash.
After Podchaser ran out of the $500,000 and $1.6 million from its pre-seed rounds, the company had to take out loans to cover payroll. Bradley quickly learned that venture capital funding wasn't quite what he expected: "I think VCs love when you say you don't need their money, and they want to get your money more than ever."
Soon after, Bradley raised $4 million in just 40 days through persistence, pursuing the right acquaintances, and a bit of luck.
Finding the right people "just unlocks all these paths that you can't possibly all keep in your head because you're unlocking other people's networks," Bradley says. "And then just keeping top of mind is how you get mentioned at the cocktail party with a billionaire. That's just how it works."
In this episode, Bradley also discusses harnessing Reddit to launch his business, mapping out an ecosystem of angel investors, and networking lessons from a man who (really) hates networking.
How He Raised It
💰 Who: Bradley Davis
💰 Company: Podchaser
💰 Money quote: "Don't fundraise when your runway is running low, fundraise when you're doing well. Fundraise when you're killing it."
💰 Noteworthy: Long before Reddit's r/WallStreetBets upended the stock market with GameStop, the Reddit community helped with Podchaser's initial bootstrapping efforts. In fact, Reddit's promotion of Podchaser helped Bradley raise a quarter million dollars.
[3:55] IMBd for podcasts 👉 Bradley's goal for Podchaser: to make the site the "information source for what you want for anything" regarding podcasts.
[11:34] From counseling to podcasts 👉 Bradley began his career as a counselor before turning to sales. While jumping between jobs, he fell in love with listening to podcasts — after that, Podchaser was born.
[17:44] Finding Louisville angels 👉 It wasn't always easy to find angel investors in Louisville, Kentucky, where Bradley was living at the time. He used his sales skills to raise an initial $500,000, even reaching out to one investor straight after his horse won a derby.
[20:30] Cold outreach led to introductions 👉 When raising money, cold outreach alone didn't work for Bradley. But it did allow him to develop relationships with people close to investors. Then, those connections introduced him to the people who wrote the checks.
[23:03] Raising (then losing) cash 👉 Podchaser raised $1.6 million in its pre-seed round … and then ran out. The company was ultimately able to stay afloat with a loan from an angel investor.
[26:28] Lessons learned 👉 That bump in the road taught Bradley two important lessons: Raise money early, and raise money when you've still got a solid sum in the bank.
[30:23] Round 2: Success 👉 Putting those lessons into place, Podchaser's second fundraising round was much more fruitful. Bradley used his investor connections to raise $4 million.
[35:43] Keeping angels happy 👉 Even though the angels' investments were diluted during the considerably larger second round, the value of the company increased — and that led to a better path for their investments overall.
[38:33] Network (even if you hate it) 👉 Bradley is no fan of networking. But he quickly found that 30-minute phone calls made all the difference to making connections and ultimately raising money.
Top quotes from the episode:
"I've always found it very useful to find somebody who's several steps ahead of you [so they can help make sure] I don't fall into a bunch of holes and make a bunch of silly mistakes."
"Start fundraising way, way earlier than you can imagine … because this is a business. VCs are like, 'they've got three months of runway, they have no other term sheets, let's drain them, let's put them to the very, very bottom, and let's get the terms that we want.' That's how it works. ... I love VCs and investors, but it's, it's certainly business."
"I totally agree with the sentiment that your luck increases as your persistence continues. We are very persistent culturally, as a company. And so I think that as we kept trying and experimenting — and I totally think that if you have enough smart people in a room to figure out an idea — if you're given enough time, you'll figure it out."
"I really had to change my mindset [on networking], because I was like … 'I don't want to talk to people like, this is a waste of my time.' But I was completely wrong. I think that if I were to fill up my day with 15-minute phone calls with all of my investors and all of my partners, maybe we would have raised $10 million."