- The speaker, Danielle, talks about her experience with fundraising and the realities behind it.
- She mentions that she had been fundraising nonstop for the past 3 years until recently.
- Danielle shares that she had raised $100,000 and had revenue when she got into Y Combinator.
- She recruited her husband as her co-founder and they raised a million dollars.
- She thought fundraising would be easy, but later realized that the first million was easy because she raised money from people she knew.
- Danielle shares some funny stories about her fundraising experiences, including meeting with a large venture capital firm without realizing she was pitching to them.
- She mentions that her previous company didn't work out and they had to let go of the team and one of the co-founders.
- They decided to build a data product and rented an apartment with a tight budget to stay together and make something good happen.
- They found product-market fit early and started making money, but it was not enough to be anything more than a lifestyle business.
- Despite the challenges, the business kept progressing and reached 500K of annual recurring revenue by the end of 2013.

- The company reached $500K of annual recurring revenue by the end of 2013 and decided to start thinking about raising a Series A.
- They faced a cease and desist on their apartment and had to move out, which made it challenging to raise the Series A.
- They managed to raise $3.4 million through various investors, including Version 1 Ventures, Fleeces, NEA, and Andreessen.
- The fundraising process involved many investors, which made it difficult but necessary for survival.
- They learned the importance of raising from a diverse group of investors and not being too focused on avoiding a "party round."
- They eventually raised a Series A led by Brad Feld from Foundry Group.
- The amount of company sold, the amount of money received, and the price were key factors in the deals.
- The speaker emphasizes that fundraising is a messy process, but it is important to keep going and assume that there will be offers.
- The panelists from the video are introduced, and they discuss their own experiences with fundraising.

- The speaker reflects on the differences between raising seed funding and series A funding, and how their initial ideas about seed funding were proven wrong during series A.
- They discuss their strategy for pitching investors, which involved targeting key people in the SAS and email industries to gain credibility.
- Another speaker emphasizes the importance of treating fundraising as a numbers game, getting as many meetings as possible and accepting that there will be rejections before finding success.
- The speakers discuss how they secured their first meetings, with one mentioning that they relied on a trusted contact for introductions.
- The importance of believing in the product and having traction is emphasized as key factors in successful fundraising.
- Being part of Y Combinator (YC) is seen as advantageous for fundraising, as it provides exposure, credibility, and support from fellow batchmates.
- YC is also praised for creating momentum and a sense of power for founders during the fundraising process.
- Different approaches are suggested for seed funding and series A funding, with seed funding being more focused on closing deals quickly and series A requiring building relationships and educating advocates.
- Efficiently closing deals during meetings is emphasized, rather than wasting time on follow-up meetings with unlikely investors.
- The importance of managing the expectations and feelings of co-founders during the fundraising process is mentioned.

- The speaker believes that participating in Y Combinator allows the entire company to focus on their goals and progress.
- The speaker's team consisted of four people during the fundraising process.
- Initially, the speaker only shared good news with the team, but later realized the importance of sharing bad news as well.
- The speaker emphasizes the importance of storytelling and sharing the company's story.
- The speaker's company chose not to focus on their investors during their press launch, instead prioritizing their product and team.
- Another speaker believes that exposure is important for a startup and recommends communicating regularly.

- Danielle shares her experience with fundraising, including raising $100,000 and recruiting her husband as a co-founder.
- She thought fundraising would be easy, but realized the first million was easy because it came from people she knew.
- Danielle shares funny stories about her fundraising experiences, including pitching to a venture capital firm without realizing it.
- Despite challenges, her company reached $500K of annual recurring revenue and raised $3.4 million for a Series A.
- The panelists discuss their own fundraising experiences, emphasizing the importance of traction and believing in the product.
- Being part of Y Combinator is seen as advantageous for fundraising, providing exposure and support.
- Different approaches are suggested for seed funding and Series A, with efficient deal-closing and managing co-founder expectations being important.
- Storytelling and communication are emphasized, and exposure is seen as important for startups.

Fundraising Panel at Y Combinator Female Founders Conference 2015, comprised of:

Danielle Morrill - Danielle is Cofounder & CEO of Mattermark, a San Francisco based startup focused on providing deal intelligence to investors, sales and business development professionals. Her company tracks the growth signals of more than one million technology companies, providing customers with insights into growth, share of voice and expansion revenue opportunity with prospective business partners. The company and its founding team are known for candidly sharing their startup adventures, which began in Y Combinator's Summer 2012 class. Mattermark has grown from 3 to 30 people over the past 18 months, raising more than $11 Million in seed and venture capital. The company most recently announced a $6.5 Million Series A led by Foundry Group, a financing which values the company at $25 Million.

Nancy Hu - Nancy is the CEO and co-founder of Apptimize, enabling leading companies like Vevo, HotelTonight, and Strava to instantly update their native apps for mobile targeting, optimization, and A/B testing. Prior to Apptimize, Nancy led the GETCO (now KCG Holdings) FI Quantitative Strategies team in New York and Chicago. While studying Math with CS at MIT, Nancy was the MIT Varsity Fencing team captain. In 2015, Nancy was named to the Forbes "30 Under 30."

Mathilde Collin - Mathilde is a founder and CEO of Front, a desktop application that empowers shared inboxes (e.g. contact@company.com, support@company.com, press@company.com) by introducing collaboration features.

Susan Johnson - Susan Johnson, a marketing and media executive, was most recently the Entertainment Lead for Facebook. She focused on entertainment marketing for 3 years, creating effective, long-term strategies that created critical and foundational social programs for TV and film partners.

Prior to Facebook, Susan was at Photobucket and Tripadvisor, where she oversaw key business development deals and expanded the revenue footprint for the west coast. A magna cum laude in Economics graduate from ASU (’03), Susan Lives in Manhattan Beach, with her husband, JR, and 2 daughters, Sloane (4 years old) and Blaire (1 year old).

Maran Nelson - Maran is a founder of Clara Labs. Clara is a digital employee that schedules your meetings, getting you to the work that matters, faster.

And I want to talk to you a little bit about fundraising.

We're going to have a panel in just a minute and have 4 different founders share their stories.

Before they do that, I'm going to share with you mine.

So in December, Mattermark announced we'd raise a $6.5 million series A.

And you know how it goes with TechCrunch stories or news in general.

But in reality, if you ever were to judge your insides versus the outsides of any founder's perfectly crafted storyline, that doesn't really tell you what it's been like fundraising pretty much nonstop for the past 3 years.

So I want to tell you what really has happened so that when you're in the same situation that I found myself in time and time again, you will know that you're normal and that not everything actually looks as perfect as we make it look in the press.

So I mentioned I've been fundraising for 3 years.

Literally, I have been fundraising nonstop for 3 years and this is the first couple of months where I haven't been doing that.

So my company got into Y Combinator in the summer of 2012.

I had been in the Bay Area for a few years.

I had been working as the first employee at Twilio.

And I got some encouragement from friends who had done the program before.

Literally, I clicked the button to submit my application minutes before the deadline.

And I was shocked when I got a request to do an interview.

I review applications now, it's definitely pretty good.

So, I get into Y Combinator and I was a solo founder, so quickly I recruited my husband to be my co-founder.

So I basically proposed, you know how they say being co-founders like marriage?

I basically got to propose to my husband, it was actually pretty cool.

So raising the first million dollars kind of tricked me, I tricked myself into thinking raising seed money and raising all money was going to be so easy.

The first million wasn't easy because those investors are like easy money though, it was easy because I raised money from people I knew.

So a couple people I'll shout out to, I hope they're listening on the live feed.

But Michelle Goldberg, who had been my mentor for about 3 and a half years at that point, she had followed the whole progression of this side project.

Dave McClure, who was on the board at Twilio, so he'd seen my work.

You know, The people that first invested in my company were investing in me, and they knew me.

I mean, people said the words, but I didn't fully understand how powerful that was.

A couple funny stories out of the first million of funding.

This is the part from before YC to right after demo day.

I kind of love fundraising, and I'm sure there are some YC partners who are laughing.

They definitely warned me, like, Danielle, you're really way too into this.

You need to go love working on the company as much as you love fundraising right now.

And it gave me that sense that I was making progress.

It made me feel like I was achieving something.

And what are the 3 main things that the founder is supposed to do?

Money in the bank, the right vision, the right team.

I was like, I'm killing this money in the bank.

So It turns out you can't keep doing that.

1, you don't have to take all your co-founders with you.

I've heard some bad stories, but I was very fortunate to meet with great people who were very honest with me about what they thought of the business and the company and the team and me.

And the second thing I learned was that I didn't really know anything about fundraising or venture capital or startups or the kind of the money side of things.

I literally met with an associate from, well I'll just say because they invested NEA, which is a very, very large venture capital firm.

I thought, oh, he just wants to like meet up and chat, right?

So he's like, tell me the story about how you started your company.

I had so much fun telling the story, the pressure was off.

And then he was like, you know, we're the biggest venture capital firm in the world by assets under management.

And then he went to the bathroom and I checked my Wikipedia.

And funny story, you know, he followed up a week later.

I had been warned by YC, don't meet with these VCs during YC.

They're unfortunately probably going to waste your time.

They just don't do deals that are so small.

We're all living in this house in Mountain View.

When he said he'd come to the house, I was like, okay, I'm coming to the house.

So just, it wasn't the person I thought I was going to raise money from.

Later on, they ended up bridging us through a really hard time.

We have an awesome relationship with that firm.

So lesson learned, sometimes the things that you think are not a good use of time are, and sometimes the things you think are a great use of time, like fundraising, at some point stop being.

So referrally the company I joined Y Combinator with was making money, but we had a business that was all about gross merchandise value.

For those of you who are in e-commerce, you know what I'm talking about.

Basically we realized that the way we were running our company we had about a 5% margin.

That's not really software economics, right?

We want a business where writing code makes sense, where you don't have to have your whole content team be the core headcount of the business.

You know, we had this graph that was beautiful.

It went up and to the right, but under the surface, we knew this is going to be a terrible grind.

And we actually wanted to build a software company.

So we told all of our investors up to that point, hey, we have about $300,000 left of the million, and we are going to stop working on this and we're going to work on something else.

And so it was very scary really because I had to fire the whole team, 12 people, and not only did we have to let the team go, we let 1 of our cofounders go And had to do a lot of soul searching at that point.

You know, I won't bore you, because I don't even really enjoy talking about my previous company that much anymore.

But basically we were reselling stuff you could buy on Amazon.

So my life felt kind of meaningless to me at that point.

Like what I was building felt kind of meaningless.

So I had to figure out what to build next with my team.

And I also had to tell my investors that we had no idea what we were doing.

So I still remember the first time I told someone we wanted to build the Bloomberg for startup investors.

It was a few months later, and it sounded really stupid.

And I said, I want you to invest, and they invested on the spot.

So you might be thinking, oh, look, it's going to be really easy again.

So what ended up happening is we thought we were going to build a TechCrunch killer.

This is 3 co-founders, so it's like 600K.

And we decided, all right, we're really jaded.

We're like this close to leaving the valley.

So we went and we rented the apartment that's on the top of the 1 Rincon Hill Tower, which is the tallest skyscraper in San Francisco.

We consolidated all of our expenses, we stopped paying ourselves.

We were like, okay, we're gonna stay together for 1 year, no matter what, we prepaid rent the whole year.

We're gonna stay together and something good is going to happen, or I'm like getting out of this town.

That's not what you put in the TechCrunch story.

We had like a $500 a month budget for food.

As we started hiring people, we had to kind of convince the people who ran the building that we were just like this rich couple that had all these contractors that would like come by.

You know, your psychology is I have no money at all.

Like literally I have a $500 food budget and that is it.

And I'm trying to convince people, I'm like, I would put on my best clothes to go downstairs.

So the good news is we truly got lucky in 1 way, which is that Mattermark found product market fit very, very early.

And so I don't think that a lot of this other stuff was luck.

But then we fell into this really fun place in SaaS, where we had some revenue, but not enough revenue to really be anything other than a really cool lifestyle business.

And we were selling to VCs, so we were selling to this niche market.

So the whole time I'm trying to find money, because every time I look at, I use Indoneuro and it has this great thing where it tells you how much runway you have left.

I think for 2 years we never had that number go above 6 months.

You're like I really do want to pay these people.

So we kind of keep progressing and the business is making more money.

We get to 500K of annual recurring revenue by the end of 2013.

And we realized, OK, we should probably start thinking about raising a Series A.

We're not going to be able to hire or grow unless we can actually build a team.

We'd slowly gotten up to about 7 people just on revenue.

So go home to my parents' house in Seattle.

Starting to build out the deck for the Series A fundraise that we're going to try to do in Q1.

By the way, everyone tries to raise in Q1.

Danielle, we have a cease and desist on your apartment, and you guys are gonna have to move out, like now, if you were gonna continue to run the business.

So we're like, well, we kind of knew this was coming.

So suddenly I'm trying to raise a series A.

And we can't let any of them come back to the apartment.

So we basically have to tell this team of people who've only been working together about 6 months, hey, trust us.

Fortunately, this did work and they did trust us, but it was a little bit weird in my head, I felt like, you know, you talk about imposter syndrome, like I was actually an imposter.

Like I was telling people that we were this rich couple who had contractors coming to the house.

And now I was going to go raise a Series A for a company that didn't have an office.

You might be thinking that this is the end of the story, and it should be because I'm running out of time, but we went and tried to raise our series A.

So long story short, and you're going to get a bunch of advice on this, came up with a list of people we really wanted to work with, went out and met with them, and everyone said no.

You don't think much about what you're gonna do after they all say no.

A few people said yes in ways that didn't really work for us.

Like, we realized We were at this place where we kind of needed to either do 1 thing or another thing.

We needed to either fly or question whether this was a venture-backable company.

So we had very little money at this point.

So I think at this point in De Niro it was like 2.5.

1 of our customers, who is a VC, Boris Wurtz at Version 1 Ventures, bridged us, half a million dollars.

So suddenly, this is the biggest single check we've received, it's not a series A, still seed money, and it just started this momentum.

Like this 1 investor, I didn't experience this with the previous round because it was all people we knew.

We just kind of called up everyone we knew.

And so then a month later, Fleeces came in.

This is not a series A, except for what ended up happening is we raised $3.4 million this way.

We announced a series A in December, but you know what?

And every single 1 of those checks, I like remember it.

So lessons learned in hindsight on this 1, if you raise from lots of investors, it's awesome and you can get momentum.

We probably wouldn't have survived, but now as we raise our round and gave everyone prerata, it's really hard.

Like you could actually have a party with that many people.

So you know, it's hard because people will give you advice.

But on some level it's like surviving is more important.

It's more important than any other advice.

Like, I could have sat there and been like, I shouldn't raise a party around, maybe I should say no.

And finally, I want to talk a little bit about the last investor that we brought on.

So Brad Feld from Foundry Group led our Series A.

And you might be wondering, like, what were the terms of these deals?

So 1 of the things we knew were a couple rules of thumb that are really important.

I learned this 1 from YC, so I hope I'm not butchering it.

But we were told, hey, you can keep raising on notes as long as you don't sell more than 25% of the company in your seed round.

I'm putting these out there because I don't know if they're commonly known or not.

And then the second time around, when we went to raise from Brad, he said, well, how much do you want to raise?

And I said, well, actually, I want to sell 20% of the company to you.

And we need somewhere between 3 and $7 million to operate.

Basically, there's only 3 numbers, right?

The amount of company I'm selling to you, the amount of money you're giving me, the price.

And ultimately, it's weird because the Series A was both hard and easy.

That final conversation was very straightforward because we'd reached $1.5 million of ARR.

We kind of kept pretending like we were gonna get where we wanted to be.

But I couldn't tell you in 15 minutes all the things that happened, all the little details.

I'm gonna post a bunch of links in case you wanna know.

But basically the key thing to take away from my story is that no matter how perfect it looks on the outside, it's a mess inside and that's okay.

And it's just like life, it's just like Instagram versus Facebook or I don't know where's your life a mess on the internet these days like wherever that is That's what it is.

And when you get an offer from an investor that you think is great just take the money and move forward And if you don't get an offer, just keep assuming you're gonna get an offer.

Like, kind of stay a little bit entitled.

I mean, we got no's way more than we got yeses.

80% of the time, we just kept thinking, yep, well, the next 1 could be a yes.

And that's, frankly, what I have learned from fundraising so far.

And I'm sure, given we want to build the B2B Google, we're probably going to have to raise a lot more money.

So I'll check back in with you guys next year and let you know how we're doing.

And now I would love to invite the panelists from the group to come up on stage.

We have Susan, Mathilde, Nancy, and Maren.

And I want to ask them a bunch of hard-hitting questions so that they can tell us a little bit about their experiences.

So I think to get us started, it would be really helpful if you could each introduce yourselves briefly, your company, and how much you've raised to date or what you've raised to date.

Women.com is a women only question and advice platform.

We did that about 2 weeks after demo day and we have some of the best investors in the world.

We have lowercase capital, Greylock, Tencent, William Morris Endeavor and a bunch of angels.

So I'm Mathilde Collin, I'm the CEO of Front.

We help companies manage shared inboxes like info at, contact at.

We raised 3.1 million for a seed run 2 weeks after YC and we raised with 2 seed funds and 32 NGOs.

I cannot tell you how much we've raised or from whom.

And it is not because I am trying to be snarky.

We let mobile teams make instant updates to their native Android and iOS apps.

Our Series A investors are Costa Noa, which is a fund in Palo Alto.

We are 2 years old and we've raised more than 6000000 dollars.

So I think to kick us off I'd love to talk about Y Combinator a bit.

I think you know where did you turn obviously YC Partners when you were starting to think about fundraising, what did that process look like?

So, raising money was incredibly daunting to me.

It seemed like this massive mountain that I would never climb up.

And so the first person I talked to other than, you know, the YC partners was actually my husband who's also a founder.

And I was lucky enough to be able to go home at night and be able to, you know, complain or strategize or just ask a ton of questions and not feel stupid about those questions that I was asking.

The best substitute for obviously not having a founder partner would be finding a mentor, someone who can be that safe zone for you that you can just go and unload to.

Fundraising is a process, and by a process I mean it's a very manufactured schedule.

Find that person who understands that process and just let them dig into it with you.

When I talked with Paul Graham, he said, you're not going to have any trouble fundraising.

He said that I have a really forceful and unique personality.

During, after demo day, we had a great time raising our seed.

And he was saying, do not get addicted to this.

But we raised on literally the most founder favorable terms possible, $2 million.

And I think 1 of the main things that I wish I'd known is that raising the seed is totally different from raising a series A.

And when we did our A, it was, I realized that I was completely wrong about a lot of the ideas I had for our seed.

So switching gears a little bit, when you started getting advice, how did you decide who to pitch?

I think the 1 thing that we wanted to do was to raise quickly as a lot of people.

See all Y Combinator transcripts on Youtube

Fundraising Panel at Female Founders Conference 2015