Wednesday, April 5, 2017

My Experience Participating in the Seattle Angel Conference XI

I am the founder of Be My Local, a tourist-to-local matching service. Whether they want to have a unique, local, “my story” travel experience or just need someone to help them get their bearings and discover how best to spend their vacation time, locals rely on Be My Local to get matched with a personally-vetted local who will help them make the most out of their time abroad.

Over the past two months, I participated in Seattle Angel Conference XI. Per its website, Seattle Angle Conference (“SAC”) is “a recurring Seattle Angel-driven event where the angel investors create a group LLC together, learn how to and engage in the due diligence of the applying startup companies, and ultimately pool funds to invest in one of the presenting finalists.”

Startup companies of various sizes that are still in their seed-funding growth stage are encouraged to participate in SAC to give the participating angel investors a chance to practice what they’ve been learning about due diligence, as well as hone their own skills in formal investor pitching and grow their own investor contact list.

In the first part of this blog, I will share with you what I got out of the experience and why you, as an entrepreneur still in the seed-funding growth stage, should join an upcoming SAC. For those interested in learning about what it’s like to participate in SAC, the second part will give a summary timeline of my own experiences and actions during in SAC XI.

How I benefited from participating in SAC

For the modest registration fee of $100 and the time and effort I put into preparing my application and pitch, I received a lot of value in return.

  • SAC forced me to take a critical, thorough, and holistic look at my business plan and growth strategies. Based on the feedback I received from the angel investors judging SAC XI, I learned that both our market analysis and our current approach were valid and viable. Our primary barriers that kept us from progressing to the semifinal pitch was our youth (we just established in January), our team (I’m currently the only one driving strategy and business growth), and our execution (we need to demonstrate previous experience executing on plans).
  • SAC gave me a first-hand understanding of the angel investing process from the prospective of a startup company making the ask. Thanks to the coaching I received throughout the process, the questions I received after my pitch, and the feedback I received after the quarterfinals, I had a much clearer comprehension of what investors look for when evaluating companies for potential investment.
  • SAC helped me grow my list of angel investor contacts. I started this process not knowing any angel investors, and now I have a short list of angel investors who know about my business in intimate detail, have provided me with guidance and mentorship, and are willing to stay in touch for updates and maybe even potential investment or introductions to other angels were I to demonstrate increased viability through execution and traction.
  • SAC gave me the platform and venue to practice and deliver my pitch in front of a critical audience with actual stakes involved. Just a few months ago, I would’ve never considered pitching to a room of investors; it wouldn’t have even crossed my mind. Within the span of several weeks, I learned what angel investors look for in a pitch, ran my pitch deck by angel investor mentors, and then delivered it successfully to a room of people curious enough to hear about my business for investment consideration.

How I participated in SAC

If you’re considering joining a SAC event in the near future, then read below for a summary of what I did up until the quarterfinals. This may give you an idea on what you can expect when you participate.

  • Early January — John Sechrest, founder of the Seattle Angel Conference, mentor to startups, and leader of the Lean Startup Seattle Meetup group, recommended that I attended the “Pitch Review for SAC XI” event as a way to network and get helpful feedback about my business idea. I took his advice for those benefits, not really giving much attention to the SAC part. I didn’t think that I or Be My Local were ready to pitch to actual angel investors.
  • Mid January — I prepped my three-minute pitch largely based off of this Medium blog post: Perfecting the 3 Minute Startup Pitch.
  • January 24 — I attended the Pitch Review for SAC XI and gave a three-minute pitch about Be My Local. John invited two angel investors to attend and critique the pitches. After each person pitched, the two investors gave feedback on what the founder could to do improve. After all the pitches were delivered, the two angel investors then encouraged the room of entrepreneurs to consider participating in SAC XI for even more guidance and feedback, plus additional mentorship opportunities, networking opportunities with angels, and the chance to put their business idea through more rigorous vetting. They emphasized that winning SAC and the prize money (in the form of a $200,000 angel investment) weren’t as important as all of the networking and professional growth opportunities that would come from participating. When I got home, I researched a bit more about SAC, decided it was worth my time, paid the $100 registration fee, and signed up for SAC XI.
  • January 25 to February 27 — I prepared my SAC formal application, which was my pitch deck and profile on In order to submit a quality application, I sought additional mentorship and guidance from Javier Soto and Richard von Hagel, two other angel investors involved in SAC and John Sechrest’s Meetup events. Javier and Richard helped me refine my pitch deck a great deal. Both also explained that the SAC angel investor judges would go through each of the 50 Gust profiles and pick the top 25 that they wanted to see give a three-minute pitch in the quarterfinals. As such, they gave helpful advice on how to craft my deck and stand out as a business worthy of the angels’ votes. I was told to give myself ample amount of time to create my Gust profile — At minimum 2–3 hours. While preparing my application, I was also focused on growing Be My Local and getting customer traction.
  • February 28 — I submitted my pitch deck and Gust profile to SAC XI for first-round evaluation. I received an email from one of the SAC volunteers that my application was received and that I would hear back in a week about the results. Fortunately, I had gained some customer traction during the two weeks I was crafting my application, so I made sure to included that progress in my application. I wanted to signal to the angel investor judges that my business idea was in fact viable.
  • February 29 to March 6 — The angel investor judges were tasked with reviewing all 50 of the applications through their respective Gust profiles and picking 25 companies to invite to the quarterfinals for a three-minute pitch.
  • March 7 — I received an email informing that Be My Local was selected to participate in the quarterfinals, and that two angel investor judges would be contacting me to schedule an in-person meeting to review my company and provide guidance and feedback for me to use in preparing for the quarterfinal three-minute pitch.
  • March 15 — I met with Allen one of the angel investor judges. We talked for nearly two hours. The first half of the conversation was getting acquainted and learning about each other’s backgrounds and motivations. Having no experience talking to formal investors before, I didn’t know what to expect. Were they only interested in talking about the business and ROI? Were they hard-nosed and biting like the investors on Shark Tank? This first hour of getting to know each other was very helpful. Once we were better acquainted, I felt much more relaxed and comfortable with diving into the details and nuances of my businesses, speaking candidly about my blind spots, and receiving their constructive feedback. After the meeting finished, he invited me to stay in touch after SAC.
  • March 18 — I met with Sam, another angel investor judge. We talked for about an hour. Similar to my conversation with Allen, we spent the first half of the meeting getting to know each other, and then the second half reviewing my pitch deck, answering her questions and addressing her concerns, and learning about what she looks for in a company. She also invited me to stay in touch after SAC.
  • March 19 to March 20 — Now that my three-minute pitch deck has been reviewed and revised based on the feedback I received, I practiced delivering my pitch. I must have practiced this pitch at least 50 times by myself, actually standing up from my chair and going through the motions as if I was on stage. My previous experience in Toastmasters made me feel comfortable with this kind of aggressive practice.
  • March 21 — I attended the SAC quarterfinals event. There were 12 presenters giving their pitch — I was the fourth presenter; each presenter would have no more than three minutes to give their pitch, and then another intense three minutes for Q&A with the angel investor judges who were seated all throughout the room. Once all of the pitches were given, all of the judges and entrepreneurs were invited to stay in the room and network with each other. The purpose of this 60–90 minute networking session was to encourage the entrepreneurs to solicit feedback directly from the judges, follow up on judges’ questions that were perhaps inadequately answered during the Q&A, exchange business cards, and dive into greater details about business plans and how investor funding would be used. I was given specific instructions by one of the judges already familiar with Be My Local to stay for the entirety of the networking session and not leave until I’ve introduced myself to every single judge. I heeded that advice and networked hard, almost to the point where I had a dry mouth and raspy voice. I’m glad I did, because I 1) received a plethora of helpful feedback, critical questions, and healthy skepticism about our business plan and current traction, and 2) noticed that the same kinds of questions around scale and competition kept coming up. This feedback showed that I failed miserably at addressing those two points in my presentation, and it also gave me a great opportunity to follow up with a few judges afterwards with a few more slides that clarify my position on scale and competition.
  • March 22 — I created several additional slides that explained in greater details how we planned to scale, who our competition were, and how we planned to mitigate competitive threats, which included the emerging Airbnb Experiences service offering.
  • March 23 — I sent those additional slides along with a thank you note to a few of the judges whose contact information I was able to collect during the networking session. After that, I got right back to work servicing some of our customers meeting with our locals in Vietnam.
  • March 28 — I received an email informing me that I didn’t make it to semifinals. What little disappointment I had in the outcome was immediately washed away by a wave of gratitude for having even made it to the quarterfinals and receive that critical feedback, and of respect for all of the other competitors who did make it to the semifinals. There were a lot of talent and great ideas in the room, and there were many businesses that were much farther along in their development process to properly warrant a $200,000 angel investment. Be My Local was still too young and immature; we still had a lot left to prove before we could earn a spot in the semifinals.
  • April 4 — I reconnected with Javier and Richard, the two angel investors who helped me prepare my application back in February, to review the feedback that the angel investor judges gave about Be My Local. Javier and Richard explained that the judges understood the market opportunity and how we planned on capturing a piece of that opportunity, which meant that I communicated those two important points clearly and to their satisfaction in my presentation, Q&A, and networking session. The judges main concerns that kept us from earning their votes were that our company was still too young, we didn’t have enough traction to warrant the kind of investment that was on the line, our team was still limited in size and skill, and we didn’t clearly explain how we planned on mitigating the threat of Airbnb Experiences. To my delight, none of these concerns were a surprise. Rather, they charted a clear course for what Be My Local would need to do over the next 6–12 months to grow our business and set ourselves up for a successful seed fundraising round, especially if we decided to pursue another SAC event.

Wednesday, February 15, 2017

What I Learned From Participating In The 2017 Startup Weekend EuroSeattle

This past weekend, I participated in the 2017 Startup Weekend EuroSeattle event.

The concept of these Startup Weekend events is simple. You and a team of six to eight other event participants have 54 hours to turn a startup idea — usually something involving technology — into a minimal viable product (MVP), complete with market data and a go-to-market strategy. At the end of the 54 hours, you present to a panel of judges and your fellow competitors. The top three teams win prizes and a heightened sense of validation about their idea.

I paid the $100 without a particular technological solution in mind. I was more interested in joining a team for the purpose of professional development, networking, and — oddly enough — entertainment.

Most of all, I wanted to learn from this experience. I can say with confidence that I did just that. Below are a few useful insights I collected from these 54 hours.

Not everyone is equipped to talk to customers

It sounds intuitive that one should talk to prospective customers and intimately understand what their problems are before building anything so as to save time and money — often limited resources for entrepreneurs. It turns out that not everyone has the skill, intuition, or even willingness to have these kinds of conversations.

Observing the room, there were technical and non-technical people alike who were either keen on philosophizing about which target markets would be best to approach, or, if the team was stacked with engineers, focusing on the building a solution to a preconceived problem sans actual data.

The act of approaching someone else in the room, asking for a minute of their time, and having a thoughtful conversation about their problems appeared at first to be few and far between. Gradually, momentum for conducting customer interviews picked up, but that was only after the midway point of the event, and it seemed as though many were conducting interviews solely to justify and validate what they had already created. One engineer I spoke to said that he had never conducted a customer interview prior to this event — He openly admitted that interviewing customers was harder than he had expected and that he had initially found himself biasing some of his questions.

Voice-of-the-customer research is indeed both an art and a skill. However, throughout this Startup Weekend I got the impression that VOC research was undervalued, and that teams were more focused on having engineers build something cool and innovative, something that would captivate the audience and wow potential investors.

Engineers aren’t the only culprits forgetting the importance of VOC research. Among the non-technical folks at the event, and especially those who claimed to be in marketing or business development, there were some who honestly believed that they knew how to talk to customers, but for whatever reason just couldn’t do it when called upon by the team. I noticed more time being spent on creating prioritized lists of potential target markets, brainstorming how to pivot the product to sell to those potential target markets, and drafting communication strategies and general marketing campaigns, instead of collecting data by talking to other people in and out of the building.

It really is possible to go from idea to MVP within weekend, and more entrepreneurs should be doing it

The act of turning an idea into an MVP that you can present to other people, getting them interested in your MVP, and even getting them to pay you a single dollar — heck, maybe even five dollars — as a signal that they place some level of monetary value on your MVP, is an exciting, inspiring, and very doable activity.

However, the idea of presenting a subpar or unfinished product to someone else with the intent of soliciting their feedback and even a potential early sale can be very uncomfortable and embarrassing. I gather that this may be especially true for those aspiring entrepreneurs who have already achieved some level of career success at larger companies with more structure and a well-established system for selling a product to customers only after it’s 100% complete. That said, for anyone who puts their heart, soul, and money into their creation, they may understandably believe that their product is a reflection of who they are, their skills, their experience, and even their intellect.

How demoralizing and utterly futile must it be to present something subpar, only to have other people quickly deride it…right?

Turns out, not demoralizing or utterly futile at all. Quite the opposite, presenting a subpar MVP gave us highly useful insights into what future iterations of our product should and shouldn’t include and helped us identify more appropriate target markets to approach.

Furthermore, Startup Weekend provided us with a low impact training ground to experience creating and using an MVP (based on the customer insights collected) to generate a list of potential customers and even close a few initial sales — something I never expected to happen. At the end of the 54 hours, I wound up with a list of potential customers with whom to send updates and even invitations to test prototypes. Not bad for anyone trying to build their customer database and improve their product development process through customer feedback.

The Lean Startup methodology is very useful for these kinds of sprint projects, but not everyone may on board

If you haven’t read Lean Startup by Eric Reis yet, then I highly recommend that you check out a copy at your local library. His methodology of creating a hypothesis about the customers and their potential problems, conducting low-cost (time, money) experiments to test the hypothesis (in our case, short problem/solution interviews), and then using those learnings to hone in on the real problem that should be solved is tremendously useful, especially when working under short timelines like Startup Weekend.

As you might imagine, I’m a fan of the book. However, much to my own surprise, I learned that the Lean Startup methodology can be a very foreign, disruptive, and uncomfortable concept to others, especially to some who come from large corporations entrenched in bureaucracy and politics, or from siloed teams where everyone follows the same traditional work philosophy of planning big before doing anything else.

I remember one particularly terse conversation within our group that occurred just past the midway point of the 54 hours.

During a group check in, one member had insisted on identifying the key decision-maker within the group. A couple of us who had been applying the Lean Startup methodology since the start of the event tried to explain that there wasn’t a decision maker in the traditional sense, but rather that we were going to let the data from our customer interviews make the decision for us.

Unsatisfied with that answer, the questions kept coming: “How are team decisions made?” “Well, who is making what decision?” “So, when we get results from the surveys, then who will make the decision on what we do with it and which direction we go?”

Based on the tone of their line of questioning, this teammate wanted a leader to make decisions, and she wanted to have a say in who that person was. Relying on some intangible entity (data) to guide the team’s trajectory wasn’t exactly a comfortable or agreeable concept to her.

At the onset of the project, agree on behavior, communication, and performance norms

In hindsight, the exchange with the above-mentioned teammate represents a lesson often learned from previous projects yet just as quickly forgotten or easily overlooked, especially in the heat of sprint projects: Get agreement early on how the team will make decisions, how information will be exchanged, and who does what and at what level of quality.

Had our team invested its first thirty minutes into figuring out these norms, then we would’ve spent less time debating strategy and questioning decisions, and more time actually getting things done. As such, it would’ve behooved those members who wanted to apply the Lead Startup methodology to educate the rest of the team on how the methodology works and why it would be the most effective way to approach the next 53.5 hours.

All said, I invested $100 and 54 hectic hours, and I returned home with more practice and experience talking to customers, relaying customer insights to the development team towards the creation of an MVP, and applying the Lean Startup methodology — all of which I’m excited to apply towards my own startup company.