Today I had the pleasure of sitting down for a discussion with C100 Charter Member and Co-Founder of Dissolve, Patrick Lor. I originally met Patrick during our CEO Summit in October but never had the opportunity to learn about him during the event. So, I asked him to take a few minutes for a short discussion to kick off our new “Q&Eh” blog series. He happily agreed.
As a resident of Calgary and a frequent visitor to Silicon Valley, Patrick has a great sense of the dramatic differences between the Valley and Canada. Naturally, our conversation began and circulated around three main topics that are frequently discussed within the C100 community:
1. Valley vs. Canada: The Attitude of Being a Canadian-Based Operation
2. Social Capital: How to Make an Impression
3. How to Raise Funding
The Attitude of Being a Canadian-Based Operation
Increasingly becoming a topic of interest is the idea that companies can build their Sales, Business Development and Corporate Development teams here in the U.S. while keeping engineering/development teams in Canada. Patrick urges companies to consider and potentially adopt this model, which we're seeing more and more of today.
With regard to his advice for younger entrepreneurs, Patrick said, "When you go to the Valley, make sure you’re hustling on the marketing, BD and Sales fronts." Many young entrepreneurs that we meet at our monthly Valley 101 events truly believe that they have to build in Silicon Valley in order to be successful. Patrick believes this isn't true. "Trying to do marketing in Saskatoon can only take you so far," he added. Not to mention, it's expensive to find talent there. "Try to leverage the strengths in each the of geographies you operate in," he said.
C100 encourages our 48Hrs in the Valley founders and extended network to visit Silicon Valley early and often.
Here are a few notable methodologies to maximize the efficiency of your trip:
· Do your due diligence: Plan your meetings prior to leaving.
· Remember that "Silicon Valley" and San Francisco are far from one another. Meetings at Apple in Sunnyvale will take a half-day, especially with traffic.
· Public transportation is not reliable. Uber and Lyft are excellent alternatives to trying to rent a car while visiting.
· For more details and tips for planning your trip, read 100 Hours in San Francisco.
Social Capital: How to Make an Impression
Silicon Valley trades on Social Capital. Understanding how to effectively leverage and make the most of the network you have as well as the one you're tapping into will be instrumental to your success in and outside of the Valley.
When asked for a few pointers for visiting early-stage founders, Patrick said, "Come up with at least 5 people you want to meet, and ask your friends to help with introductions. When you ask for that help, send along killer pitch materials, so your friends can write you a strong recommendation.”
Our goal at C100 is to truly help the entrepreneur maximize their experience here and support them when they return home. It's important to understand the need for founders to explain the “why” when asking for introductions.
Here are a few pointers in making a positive impression:
· Explain who you are, what you're doing, why you're reaching out and why that person should be interested in meeting with or speaking to you.
· Do. Your. Research. If you're looking for an introduction to an investor for your fintech startup and this person exclusively invests in consumer technologies, not only will you lose the introduction, you'll lose credibility.
· Understand the desire for others to talk about themselves. Appeal to this by continuing to do your research and developing an honest, genuine desire to learn more about them. Aim to hear their story before sharing your own.
o Read How to Win Friends and Influence People by Dale Carnegie if you haven't already. Or, read it again if you have.
· Ask the right questions. Learn from experienced founders. Patrick added, "Take advice and learn from the pain I experienced when I was a young entrepreneur."
· People here are willing to help. But, you have to be willing to give before you get.
How to Raise Funding
Perhaps the most common of all topics discussed during our events is the ins and outs of raising funding and the differences between doing so here and abroad.
On this topic, Patrick emphasizes the need for founders to understand that it takes time and patience to perfect the art of raising. "You don’t want your first hockey game to be in the NHL," he said. "Take some time and sharpen your game. Practice." In terms of it being a numbers game, it's important to remember that there's a very small ratio of startups getting funded. Anonymous Charter Member at a top 5 VC firm confided in me recently on this topic, stating that he held calls with or met over 2100 startups last year... resulting in 4 investments. Some firms are more publicly notorious for investing in one company per quarter.
Patrick advises founders to start with smaller investors that are experts in your sector, stating, "part of [raising capital] is social proof. The result is always better when there's credibility at the end of the intro."
While raising capital in Silicon Valley is far from a science, just as investing is an art, there are a few pieces of advice that may prove helpful in the process. Here are a couple of them:
· Stop focusing on Celebrity VCs. Smart money doesn't have to come from Marc himself, NEA, or some other notorious acronym.
· That being said, while many will say that "money is money", looks can be deceiving and every dime is different. Find investors who believe in you and what you're doing.
· Read the fine print. If the firm you're talking to is making unreasonable requests, walk away. $100K isn't worth it. $100M may be.
· Make sure your cap tables are clean. Document everything. A messy cap table will destroy a term sheet.
· Go with your gut. If it feels right, it's likely that everything will work out. If it feels sickening, say goodbye.
In an effort to continue supporting Canadian entrepreneurs, C100 encourages you to participate in our series by providing feedback, suggesting topics or tweeting at us using the hashtag: #C100OpenBar and @thec100.
A huge thank you to Patrick Lor for joining us, the rest of our Charter Member network and Partners who support our mission, and to the entrepreneurs continuing to making us proud to support Canadian entrepreneurship.
If you’re interested in having a drink with us and contributing to the series, please don’t hesitate to contact us.
- Andee Gardiner, Marketing Manager