Startup Fundraising Strategy & Pitch Practice Office Hours Replay! [VIDEO]

Our free Startup Fundraising Video Office Hours help early stage company founders worldwide learn how to raise money for their startups. 

The fun, friendly live video Q&A sessions answer financing and strategy questions from entrepreneurs from all over the world with FREE expert startup advice.

The latest free session hosted by our CEO, Scott Fox, was March 31.

To watch the new Startup Office Hours replay click here.

Startup Founder Discussion TOPICS This Month

In this episode of our free Startup Fundraising Office Hours, StartupCouncil.org CEO Scott Fox took lots of questions from startup friends worldwide - both on camera and via chat. These mostly focused on helping startup founders accelerate their fundraising process to raise money from angel investors and venture capital firms including:

• Mustafa, Irvine, CA: A medical doctor and AI developer, he pitched his company A1 Diagnosis, which uses a blood-based AI platform to detect age-related macular degeneration risk years before vision loss occurs. He is raising $1.5 million for lab certification with a 70% target net margin. Scott praised the pitch for its clarity, unit economics, and strong team credentials, and suggested Mustafa slow down when stating they are the first platform of their kind, and consider restructuring the ask to either $500K or $3–4M to avoid the difficult middle ground for investors.

• John, Tustin, CA: He asked two questions — first about the purpose of a side letter accompanying a SAFE agreement, and second about how often investors expect financial updates after investing. Scott explained that side letters supplement the simple SAFE document by adding investor protections like information rights and most-favored-nation clauses, and advised founders to overcommunicate with investors on a regular cadence, since ghosting investors damages future fundraising relationships.

• Michael, Corona, CA: An MBA student at Cal State Fullerton who was laid off the same day, he pitched The Mollisk, a media and marketing agency built around adaptive storytelling and ethnographic research, seeking $50K initially toward a $200K raise. Scott commended his delivery and clarity on target campaign sizes, but noted that an agency model typically does not fit the venture capital investment thesis since it scales through people rather than software, and recommended he network with marketing and agency professionals instead and explore events through the OC Startup Council.

• Manuel, Orange County, CA: He asked whether investors partner with general contractors to split profits on construction projects. Scott acknowledged this was outside his software and tech investing expertise and redirected Manuel to the SBDC and SCORE for more relevant guidance.

• Sunil, Patna, India: He asked what the single most critical capability is for a war-resilient and globally dominant startup. Scott answered that revenue growth is the most important factor, and added that diversified supply chains and distributed remote teams are increasingly valuable for resilience.

• Aaron, Dallas, TX: Asked about the differences between Reg D and Reg CF for early fundraising. Scott explained that Reg D targets accredited investors for larger raises while Reg CF allows the general public to invest smaller amounts up to $5 million, and recommended crowdfunding works best when a founder already has an audience and a product the average person can understand and get excited about.

• And (as usual) everybody wanted to know the best resource to find early stage investors interested in their startups. Answer: Google + https://www.StartupInvestorsDirectory...

And much more, as usual!

Watch the free replay for startup founder pitches, and the expert investor feedback they got!

To watch this month’s Startup Office Hours replay click here. 

And see a complete TRANSCRIPT BELOW.

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Visit https://www.StartupCouncil.org now to join us for lots of startup resources, expertise, publicity opportunities, events, and much more - including FREE email newsletters - and discounts to find investors using https://StartupInvestorsDirectory.com's unique investor research tools.

Plus, get details on StartupCouncil.org's worldwide network of Meetup groups that can help you to promote YOUR local startup events in YOUR city, too.

Great to see everyone and congratulations on progress you are making with your startups! 

JOIN STARTUP OFFICE HOURS LIVE NEXT TIME to WATCH & COMMENT:

The Startup Office Hours livestream is the 4th Tuesday of each month at 900pm PT / Wednesday 1200am ET. Questions and practice investor pitches are hosted LIVE by Scott Fox, CEO of the Startup Council/Angel Investor/Serial Founder/Author/Startup Expert.

You can watch LIVE here later this month on April 28:

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Subscribe to the YouTube channel here!

MasterMinds Startup Fundraising Office Hours TRANSCRIPT for March 31, 2026:

0:00

startup. It's time for Startup Fundraising Office Hours. I'm Scott Fox and we're going to spend the next hour

0:06

or so together unpacking the challenges, obstacles, and the opportunities that

0:11

you have in Startup Land. This is a free show that I do as part of our work at Startup Council and we're here to help

0:17

you answer the questions and and figure out the next steps so that you can find success as a startup entrepreneur.

0:24

There's a lot of challenges and it can be a lonely job as well to be a startup founder. So, I'm here to help you based

0:30

on the benefits of my years of expertise to help you negotiate the twisting and tortuous path, especially around raising

0:37

money. The language of venture capital and angel investors is different than that of normal people. So, we're here to

0:43

help you demystify some of that and take your questions and practice your investor pitches and come together to

0:49

help each other really here in our chat rooms and in the follow-up communities that we host both on LinkedIn and over

0:55

here at startupconsil.org. If that sounds like fun to you, you're in the right place. Thanks for joining me. We've got people checking in tonight

1:01

from all over the world as usual. I've been doing this for a long time, but we're really trying to help people. I know that sounds silly uh and maybe uh a

1:08

bit disingenuous, but the fact is that it's hard to be an entrepreneur. And when I started out with my first company

1:15

back uh in the dot 1.0, the web 1.0 boom, which was almost 30 years ago now,

1:22

there weren't any resources really at all. And it was really hard. These days,

1:27

the world is more focused, more appreciative on entrepreneurs and there's a lot of information out there. The blogs and podcasts and AI. I mean,

1:34

there's all kinds of tools you can find, right? The problem these days is actually there's almost too much information. It's hard to get straight

1:40

answers from real people who've actually done this stuff who won't charge you $1,000 an hour for their time, right?

1:46

So, this is community service charity work that I do based on my years of expertise and uh I'm trying to help.

1:52

Here we go. Right? So, let's do this together. And if you're here um checking in from around the world, we are happy

1:58

to have you here and want you to be uh enjoying yourself and asking questions and um participating as much as you can

2:06

so that we can add some value in your life as you build your startup going forward. So who am I? Why do I have the

2:11

microphone? Well, like I said, I'm a longtime I'm a serial entrepreneur that they call that, right? I raised my first

2:17

venture round back in web 1.0 know and I've been building and helping and consulting and now mostly investing in

2:23

early stage startup companies all over the world for several years, many years now. I've written these books behind me

2:29

over here. Uh the three in the middle are in English. There's a bunch in other languages as you can see, Japanese and

2:34

Turkish and Polish and Vietnamese and so forth all over the world. And those books are about my journey from being a

2:40

corporate person who realized he didn't really like corporate work and trying to reinvent myself as an entrepreneur. And

2:46

those books I wrote to try to help other people do the same thing. So if that's interesting to you, check them out. Uh the newest one, Click Millionaires, uh

2:53

is about 10 years old, 12 years old now. So a little bit out of date, but the principles could still be helpful to you

2:58

if this is the path that you're on. In the meantime, I'm working on a new book which we'll be previewing uh a little

3:04

bit today probably, but certainly in the next couple months about specifically how to raise money as a startup

3:09

entrepreneur because I've moved from the founder side of the table where I'm asking for money to the investor side

3:15

where I'm investing the money. So, I've got both perspectives and hopefully that can be helpful to you both in upcoming

3:20

book but also here during this show. So, we're here. live on uh Facebook and

3:26

LinkedIn and um uh there's another one, Facebook and LinkedIn and YouTube,

3:31

right? And YouTube and uh if you're watching this on any of those, I would love to hear. I'm going to turn on the chat here so that folks can chime in and

3:38

say hello if they would like. And uh looks like there's some people in there already. And um yeah, go ahead and let

3:45

me know what uh what networks you guys are on. Make sure you can hear me and see me also. Um I think you can see me probably, but sometimes we have trouble

3:51

with the audio. But please let me know if linked if anybody's on LinkedIn please say hello and if you're on

3:56

YouTube say hello and if you're on what's the other one Facebook um just let me know things are working uh

4:01

because we would like to make sure that everybody's included because that's the way we promote this right is that it's in multiple channels and it's free right

4:08

so can't can't argue too much about that I hope so um happy to help you and we're

4:13

going to get on backstage I can see it looks like my is that my friend Mustafa back there yes Mustafa is here and so

4:19

we're going to bring him on in a minute and I think he's probably going to want to practice his pitch Michigan. He's a very smart guy and his pitch he's he's

4:25

smart in general. In fact, he's a medical doctor, but um he's smart also

4:30

because he comes back here uh repeatedly and his pitch gets better every time. So, proud of him for taking advantage of

4:37

the uh of the opportunity. Um sorry, I turned that off. Too many

4:42

buttons here. Okay, chat. Turn the chat on. And they put this overlay thing on

4:48

it. Remove the overlay. No, that's not what I want. I just want this thing to get out of my way. Well, I guess it

4:53

won't. All settings. Here we go. Overlay on. Message alignment. Message opacity.

5:00

Wow, you can all customize. Man, these get help fancier all the time. Okay. So, okay. So, there's some confirmations.

5:06

Great. Dr. Sanjay Praash Sahu or Sabu. Sahu says LinkedIn. Thank you, Sanjay.

5:12

And, uh, Harit Vitvus. Oh, Harl, you you're here in Orange County, right? YouTube. Nice to see you. And Chuck on

5:19

YouTube. Okay. and and live from LinkedIn also. Where are you guys? What um it looks like Oh, John. John's from

5:25

Tustin. That's right near here. And the rest of you, where are you in the world? Are you um Orange County, Southern

5:30

California? That's where I live. Or are you I don't know, are you in England or India or Australia or uh Minneapolis?

5:36

And there's lots of places. Uh and I know we get people from all over the world here. So, come on in and let me know where you are. And go ahead and

5:42

post your questions in the uh in the chat as well if you'd like. And if uh anybody wants to come backstage as well,

5:48

we can do that as well. Let me put up the the invitation link there. Yes. So, this

5:55

should work to get you on camera if you want to uh chime in and join me backstage, but only if you have a

6:01

specific question or an investor pitch you want to practice, okay? It's not just a hangout sort of thing. Uh

6:06

otherwise, I'll I'll work out of questions on the chat room, right? And I'll just talk about them and uh we'll be as helpful as we can, of course. But

6:13

if you'd like to come backstage, that's the way to do it. So, okay. So, here's a couple more people. Chuck is in Seal Beach. That's near here. And Mars is

6:20

John in Orange County. And Michael from Corona. And from DC. There we go. Finally, I had everybody from Southern

6:26

California. That's unusual. So, Hannah. Okay. From DC, Delhi. There we go. Thank you, Dr. Sanjay. I know. I know we're

6:33

worldwide. So, it's good to have the rest of the the uh the globe represented. So, okay. And there's

6:39

another one. Silk Kumar Singh from Patna. Okay. Oh, yes. Okay. From Fatna. Excellent. Bihar. Excellent. My a lot of

6:46

friends there including yes, Mr. Anamansha. Good good friend of mine. Okay. So, let's go on and Oh, sorry. I

6:53

have to do the disclaimers and then I'm going to bring um if you want to come on camera, like I said, use that URL or let

7:00

me know if it's not working. I haven't updated that lately. But let's talk about um Oh, there's a good question,

7:06

John. Uh aside letters for safes. Yeah, we can definitely talk about that. Let's

7:11

uh I need to do the disclaimers. Okay, here we go. and then I'll get to the to the real stuff. Okay, this is not

7:17

qualified legal or financial advice. Please consult your own professional advisors. I have a lot of experience.

7:22

Um, but these are all just my opinions, okay? So, you should not act on them. I'm just some guy you met on the

7:28

internet. So, please hire your own attorneys, accountants, uh, medical doctors, whatever it is you need to get

7:35

the, um, advice that is specific and appropriate for your situation. All right? So, this is not to be relied

7:41

upon. This is for entertainment purposes only. I'll do my best, but uh as Seth Goden likes to say, your mileage may

7:48

vary. And then also, this is being recorded and will be replayed. So, um don't say anything crazy or too

7:54

confidential. And we will be posting it. It's actually literally live already or else you guys couldn't see it, right?

7:59

So, this is a uh a worldwide broadcast and it will be archived on YouTube and a lot of other places around the internet.

8:05

So, hope that uh sounds like fun to you. And what else? Uh, okay. Let me just do

8:10

a couple more here since we got it. Uh, come and find us on LinkedIn. Happy to say hello. The Startup Council has a big audience there, as do I personally.

8:17

Happy to see you there. And I guess I should say this show is, we don't have sponsors on this show right now, but

8:23

Startup Council, that's this organization that I run. You should all be members there. I literally, we built it for you. It's a platform that

8:30

connects all the resources and helps you connect with each other. And um, it costs, it's we're just launching right

8:36

now, so it's only $49 a year, not a month. and then you can get listed and get in the mix with the investors that I

8:42

know and all this stuff. And I'm trying to I'm trying to get a a situation where we get enough momentum together that the

8:49

whole becomes greater than the sum of the parts as they say, right? And we get some real momentum. And in fact, there's some amazing discounts that we got

8:55

already because we're starting to get some critical mass there. If you are in the market for uh especially software

9:02

like SAS services like Dropbox or Zero or QuickBooks or AWS or there's hundreds

9:09

of offers that we've got on the site that can way more than repay the uh the

9:14

small membership fee. We just charge the membership fee to keep out the knuckleheads and to cover the basic costs, right? It's a break even oper.

9:20

It's charity work that I do essentially, right? So visit startupconsil.org if you uh would like to participate

9:26

because we'd love to see you. Oh, there's sorry. Here's a better explanation of that. Okay, so that's

9:31

enough preamble. Let's get to I think we'll get to uh let me just say hello to anybody else in the chat room and then

9:37

Mustafa, I'm going to bring you on. Let me let me just see here. What's Make sure

9:43

nothing's on fire here. Okay, so Sil, yep, good. I'm just looking at your

9:49

questions. Okay. Yep. Yep. Those are all good questions. Um,

9:55

Manuel and banana banana bread and John. Yes. And then I saw something about

10:01

somebody losing their job. What was that? There we go. Michael, this is incredible. Hold on. What is this about?

10:07

Just link nonprofit today. I'm going to fundra for my own business. Oh, okay. Great. Okay, Michael. Well, we

10:13

will definitely talk about that. Just hang tight. I guess you got time, right? You got You lost your job. I'm sorry. I don't mean to make fun of that. Um, you

10:20

just got let go today, but yeah, you've got some time. Let's figure this out. happy to help and uh we'll see if we can put you on the right track. Okay. So,

10:26

let's bring on a live um let me put up the link once more uh for uh how to join

10:32

me and if any of you who are here want to come on and um participate live then we can talk to each other right

10:38

otherwise I will just keep talking and reply to the questions just as I did there when I put it on screen. So,

10:43

that's the URL and let's bring Mustafa on and see how he's doing here. Click

10:49

click click with this. Let's click with this. Uh oh yeah, please like and subscribe. Oh yeah, invite your friends.

10:56

Right, we're just getting started here. We got about an hour. So if you have friends who could benefit from this, please go tell them right now. Um why

11:03

not right here? Just tell them to come over to YouTube. We're happy to help. And um the more the marrier and you can

11:08

help each other, too. I don't have all the answers. Okay, there we go. All right, so here's

11:13

Mustafa. Okay, Mustafa. There he is. He's back. Hey, doc.

11:18

Hi. Hi, everyone. Good to see you. Good. Good. How are you?

11:24

Nice to see you, too. Yeah. Where did I see you last? I saw you recently somewhere in person.

11:29

Red Bull. Red Bull, I think. Oh, that's right. At that Red Bull event I hosted, right in in Santa Monica. Yes.

11:35

Yes, that was great. That was a surprise to see you there. I'm glad you made the drive. Yeah, that's fun. Yeah, I'm I'm happy to see you too at

11:41

that time. It's was really nice. And and also last week I was in U Stanford

11:46

University. We have a AI healthcare conference. We attended it was great and I presented over there

11:53

15 minutes. Wow. Which was great. Wow. About the company or something like research or something?

11:59

Uh this is a AI healthcare conference and I presented a A1 diagnosis our

12:04

company. Oh, about the company. Fantastic. Great. Well, that's you're getting around.

12:09

Yeah. Thank you. and also just before the uh uh co-founder of uh

12:18

tax genomics company. This is a $2 billion company. What what was the name it broke up

12:24

there? Oh, sorry. Uh if my internet might not be great. Uh the the company name is 10x

12:31

Genomics. Uh maybe you heard that 23 and me. Uh you may heard that the founder of

12:38

the same founder of the person he opened up another company 10x genomics right

12:43

now is $2 billion company right now in the market cap. Wow.

12:49

I presented just before him. Oh

12:54

great. That's pretty good company. Good for you. Good for you. That's exciting. Okay. Well, do you want to do your usual

13:00

uh pitch practice? Yeah. Yeah, I'm happy to do that. Okay, let me um let me just tell the audience

13:07

here how this works. So, what we do here on this show is a twominut pitch. So, no slides, just talking. And this is

13:15

clearly an artificial um exercise. is, you know, there it's rare that in the real world you would do a two-minute

13:21

pitch, but I picked that number because it's long enough to get the ideas across and it forces the founders to really be

13:28

concise because the one thing you don't want to do is have a 10-minute pitch that could have been done in four minutes because we investors will all

13:34

fall asleep or start, you know, looking at our phones, right? So, you being concise is really important because we're all in a hurry. So, uh this is a

13:42

two minutes only verbal and I'll set the timer. He's done this u u Mustaf has done this a few times so he shouldn't be

13:48

any problem time wise but if anybody else wants to try that that's that's how we do this and then here's the key I'm

13:54

going to give him feedback because I listen to pitches all the time and I have lots of opinions but also would

13:59

love to have your opinions those of you who are watching who are in the chat room if you have opinions about things

14:04

that he could do better or differently or things that he left out um that would be really helpful to hear as well and

14:10

you can put those in the chat room right and that way we all help each other because like I said I do not have all answers. I'm just kind of the master of

14:16

ceremonies here. So, okay, with that preamble, here's here's Mustafa. Go ahead and whenever you're ready, doctor.

14:22

Okay. Hi, everyone. My name is Mustafa. I'm a medical doctor and AI developer

14:28

and CEO of A1 diagnosis. 20 million Americans have ACE degeneration which

14:35

cow central vision loss. It is irreversible. It is detected after damage happens. Our AI powered

14:42

laboratory platform detects H8 rates moleular degeneration

14:48

uh risk hrates macular degeneration risk years before vision loss. This is the

14:54

first bloodbased risk assessment platform for hrates macular degeneration. I would like to explain

14:59

our technology in a simple language. When we get older, some cells in our eyes start dying. Where do these cells

15:05

go? They go into the blood. Previously, we couldn't detect them in blood. Now we

15:10

can how it works. The patient go to the eye doctor office. Blood is drawn send

15:16

it to our laboratory. We analyze it with our AI platform. We provide this

15:21

assessment result to the patient and doctor before vision loss happens. Unit of economics price is $250

15:29

uh $60 variable cost and $50 fixed cost. Target net margin is 70% at scale. Who

15:35

we are? I performed research at University of California Irvan for six years and wrote AI algorithm. Co-founder

15:43

Dr. Murat Bada is a Stanford scientist who raised over $10 million who has a regulatory and commercialization

15:50

experience. What we have done proof of concept study is completed. We are raising $1.5 million for clear

15:56

labification. Our model is B2B insurance reimbursement opportunity. Revenue start first quarter

16:04

2027 A1 diagnosis. See the future clearly. Thank you.

16:10

Wow, that was awesome. Seriously, man. That that that was

16:15

that you were nailing it there. I you I Wow, that was really good. You you you

16:21

must have been listening to me. At least it's the kind of pitch I like. Um, yeah. I mean, okay, so before I get

16:28

too enthusiastic, everybody else who's listening, if you have suggestions, I've heard this pitch a few times, and I've

16:33

heard a lot of pitches in general, so I may already be a little bit uh biased in a positive way, right? So, if you were

16:40

new to this and you're not a doctor, like I'm not a doctor either, uh, put your comments in the chat room like what

16:45

didn't you understand or what suggestions you have because that's why he's here. He's looking for feedback from real people, right? We can all ask

16:52

our mom and and mom all mom always thinks what you're doing is great. That's her job, right? But you gota have

16:58

other people, you know, validate you. So, um, okay. So, any suggestions from the audience would be super. So, okay.

17:04

But I want to highlight some things you did really well. I have I always have a couple suggestions, but this is the is

17:10

this third or fourth time you've come here, I think. I think the fourth time. Yeah. With your

17:16

suggestion is getting improve and improve. Yeah. That was that was dynamite. it. And what's interesting about it is that

17:23

it wasn't so much a story because a lot of people who do pitch coaching want you to tell a story and that is a valuable

17:31

approach if you're not talking to experienced investors. You want to tell a story for people who

17:38

if you have more time first of all, right? Because you didn't have a lot of time. So a story is good because it brings people in emotionally. But if

17:44

you're talking to professional investors, I don't really care about the story. I want the numbers, right?

17:50

Because the story can be great, but unless I know what the numbers are, it's just fiction. So, what you you are you

17:56

are a victim of my advice because I like that pitch a lot because you're doing what I want to hear, which is numbers.

18:01

So, you gave um you said uh you gave unit economics, you gave margin, you

18:07

mentioned that your team member, both you and your team member were not only qualified, but that he'd raised $10 million previously. That always gets

18:14

investors attention. um you're you you talked about what stage you're at the

18:19

proof of concept you're moving from this to this so we knew how far along you were and then you were specific about

18:25

the ask which is really why you're here right like what do you actually want because I see so many pitches I'm not

18:31

telling you because you figured this out but everybody else listening um so many pitches people want to come in and tell

18:37

a story and it's it's this vague thing about like and I don't mean to make fun of it but I see so many pitches like I'm

18:43

going to cure cancer because my grandma died of cancer and that's a lovely and noble thing but I need to hear about the

18:50

business right and because I want you to cure cancer too of course but we can't

18:55

help you unless you give us the numbers so this is this is great um and if if I

19:01

were an investor in that area I now have heard enough to know whether I'm interested or not because the other big

19:07

trouble that we have as investors is people talk and you're like okay this is interesting he he's an aerospace company

19:13

and I'm an aerospace investor But I'm they leave me unclear as to how far along they are, right? And I'm like,

19:20

okay, so do you have the airplane built or is this just on paper still or somewhere in between? And you also you hit that like I am this is where I'm at.

19:27

And that is important be and the reason I say this is because investors have a job and they are given a job by their

19:33

investors, the limited partners, which is usually to they don't just invest in general. They invest like at companies

19:40

of a certain stage of development. And that's an important thing that founders often miss. We don't invest all the way

19:46

from the earliest stage companies to late stage companies. Most of us have a focus. And if you gloss over that, we

19:53

can't help you. So anyway, I I I'm very excited about this. That was great. So

19:58

um Okay. And go ahead. What was that?

20:05

I I said the investor every investor has a investor hypothesis. So we need to make sure also when we reach the

20:12

investor they matching actually their hypothesis and then our our exactly exactly yeah our hypothesis if

20:20

you make it easy it's like anything else if you make it easy for us we'll make it

20:35

are we back hopefully we're back I can't hear you.

20:41

Okay, it disappeared there for a second, but I think I'm back.

20:46

Yeah, I can hear you. Okay, I froze. Yeah, I think I think it was me somehow. I don't know. That's

20:53

been a while since that's happened. Sorry about that. Okay, so Michael says, "Uh, love the enthusiasm and humanity

20:58

you brought to the pitch." Yes, you're excited about it and um it's personal for you. That's great. I think that's

21:04

that's a key thing. So, if I was going to improve it, and I think that's why you're here, hopefully. Can you hear me?

21:11

Are you still with me? Yeah, I'm I hear you. I I hear you. Okay. You know, if you don't mind, I'm

21:17

going to turn off your camera. Um, and that might reduce bandwidth load. Okay. But hopefully you'll still be able to

21:22

hear me. Um, okay. I can still see you backstage. Can

21:28

you give me a thumbs up? Can you still hear me there? Okay, good. Okay. Okay. And you can hear me now says too. Okay,

21:33

good. So, I'm just going to give a little more response to Mustafa, but I took him off camera because that might have been you, you know, it takes

21:39

bandwidth. Okay, so here's a couple thoughts for improvement. We've talked about this before, and it's still, and

21:45

this is because I'm not a medical person. If you're talking to a room full of doctors, they'll probably get this much quicker than I am. Um, but you talk

21:52

about it as a laboratory platform, and then you mention the word assessment. I would love just one more sentence that

21:57

says something like um you know we take a sample of blood

22:03

and we use a a special device in the lab to create lab results that tell us what

22:10

we're after or something like like because I don't know what happens right and it's it's my ignorance not this is

22:16

well established stuff obviously in the medical world but I don't know exactly and I'm still not clear we've talked

22:21

about this before are you software are you hardware is there a device are using somebody else's device like do you have

22:28

some dependency on a supply chain that I couldn't quite hear and that might be a

22:33

more advanced topic for two minutes you did great but to me a laboratory platform I still and again it's me I

22:39

don't know what a laboratory platform means right so just a little more explanation about that I think would be

22:44

helpful um another thing you said about the platform though is you said you were the first platform to X Y and Z that's a

22:51

big deal like when you have a big deal like that slow down like we're the first

22:56

platform, right? Bang. Let that hit. You know, it's like this is a we are pioneering with a dramatic pause. We are

23:04

the first like, oh, okay, you know, like like let people absorb that because that's significant. And um it means

23:11

opportunity, right? It means risk also, but it means opportunity. Um and then I'm just looking at my notes. Your unit

23:16

economics are great. I love the fact that you and your team member were are both um very accomplished. I liked at

23:22

the beginning by the way you introduced yourself as a medical doctor and AI developer. That right away is very

23:28

attentiongrabbing at least to me. Like how many of those do you meet? You're doing both. That's that's pretty cool. I

23:35

think um and then your partner had a great record I think you said about regulatory and compliance and that's

23:40

that's very good too. You also discussed the business model which was great the insurance reimbursement and so forth. Um

23:47

and explained where you were in the process. I mentioned that already. The other suggestion I would have, and this is more strategic, is that $1.5 million

23:54

is a hard amount of money to raise. I don't know if we've talked about this before. It sounds easy, and that may be

24:00

the number you want. The problem is that it's too big for angels and it's not big

24:07

enough for venture capital. So, I would wonder if there wasn't a way to

24:13

restructure your plan just to make it easier on you to raise either $500,000 or say three or

24:22

four million or something like that. Right. And I have to say this is you're in the medte space which I don't know as

24:28

well. So I'm using um software industry sort of benchmarks which are my expertise but at least in software I

24:35

anybody ever says they want to raise a million or a million and a half or even two million I always try and stop them because there's no there are few

24:42

investors in that space. There's a lot of angel investors who could together,

24:48

you know, each write you 25,000 or $50,000 checks and you could get up to, you know, two, three, four, $500,000.

24:54

Especially if you go to a group like a Tech Coast Venture Group or something like that. You could and then there's

25:00

certainly venture firms who will write you uh a $2 million check or or they'll lead a round of$2 or $3 million. They'll

25:07

put in say you know I don't know 750,000 or a million but then they want to do a

25:12

round so that there's a two or three million raise to try to raise one and a half million by itself in my experience

25:18

at least in software is very difficult. You're kind of in a no man's land. So that would be something to think about.

25:25

Um and I know that that is difficult because you have obviously you didn't pick that number

25:30

out of the air. You have capital requirements and goals and that there's a reason for that number, right? But I'm

25:35

just telling you, it's like it's like trying to uh I don't know. It's like trying to buy a car that's exactly

25:42

$47,000, right? There's lots less than 40,000 and lots more than 50, but if you're right in this one spot and you

25:48

have to be right there, it's hard. So, you can do with that what you will, but that that's my experience. I hope that's

25:54

helpful. So, um and we can talk about that more next time I see you.

26:00

Okay, cool. So, Michael's in backstage as well. Thanks for showing up and nice to see you. I hope that's helpful. Um,

26:06

let's see the uh next thing. So, Michael, we're going to bring on here in

26:11

a second. There was I want to do a couple of the uh Michael, if you can hang on a sec, I want to bring in a

26:16

couple of the chat uh questions because um then we can go back and forth, right?

26:22

Keeps it more interesting. Okay, so where were those other questions?

26:28

Okay, so here's a good one. Let's start this. Please explain the purpose of the letter that accompanies the safe. Great,

26:36

great question, John. Um, so a safe is a simple agreement for future equity. This is this is right in the sweet spot of my

26:43

new book, actually. So, I'm going to take your question down and I'm going to put up Don't I think I have a little

26:48

promo for the book? Oh, yeah. Here. Okay. So, this is going to be coming

26:53

soon. So, if you're not on the email list, we have a special email list just if you want previews of the new book. And it is all about exactly this kind of

27:00

stuff. just what I was telling Mustafa like how much to raise uh who to target and then what are safes what are side

27:07

letters what's the best deal structure all that it's like but in plain English like the way I talk it's was literally

27:12

me talking right so okay so aside with safes I was just it's funny you asked because I was just working on this on

27:19

Sunday uh this chapter in the book so a side letter so this let's start with the safe safe simple agreement for future

27:25

equity is a templated deal that early stage companies use these days to raise

27:32

venture capital style money. It's not usually used necessarily with venture capital firms, but more often for

27:37

friends and family and angel investors who want to get in early without a lot of expensive paperwork because when you

27:44

do a real venture round to do priced equity can cost tens of thousands of dollars and eat up a lot of what you're

27:50

raising, right? If you're only raising say hundred grand, you don't want to spend 10 or 20 of that on the documentation. A safe is a simple

27:57

letter, a few pages that you can sign and be done in 10 minutes. It's a very standardized template.

28:03

The problem, and there's a lot more details here that I'm glossing over that we'll do in the book or if people have follow-up questions, the side letter is

28:11

what has evolved because the safe is so simple and so easy to document that it

28:17

doesn't protect investors as much as they would like. For example, it doesn't have standard information rights or it

28:23

doesn't say what happens if things go this way or that way in a bad way. You know, there's there's protections that

28:29

adventure investors want. Most favored nations clauses, pratas, things like that which are all addressed in a side

28:37

letter. So, as lawyers are typically wanting to do, the simple two or three

28:43

or four page safe template now generally has a side letter of of several pages as

28:49

well, which is negotiated and which does take time and money to negotiate. So, um

28:55

those are the kinds of things that we're we're talking about. And the purpose to answer your question is that investors

29:02

want to protect themselves. They want some of the benefits and legal protections that they would get if they

29:07

had signed a more elaborate and more expensive deal but without the full

29:13

monty without the full investment in all that paperwork basically. So they are fairly standard these days. A real um

29:21

active venture capital firm will have kind of a standard side letter in many cases. they'll actually just give you

29:26

that and they really won't even want to negotiate it much. If you're just working with an angel investor uh or an

29:33

angel investor group, they might have a sort of more of like a suggested format that you can negotiate. Like everything

29:40

in venture, it's negotiable. But the basic answer to your question is the investors are trying to protect themselves because a safe by itself is

29:49

an agreement to give you some uh a certain amount of equity to be determined later. And that's lovely in

29:56

terms of its flexibility and it's low cost to document but it leaves the

30:02

investor kind of unprotected uh if things don't go as well as everybody hopes which often happens of course

30:08

especially in startups. So I hope that answered the question but you can ask a follow-up or or two if you'd like uh in

30:15

the chat room there John. Okay, let's see. That was our first question and

30:20

then um let's do this one and then Michael, I'll bring you on if you don't mind. Okay.

30:27

What are some good practices and habits to get into as well as pitfalls to avoid as an entrepreneur? Well, I'm literally

30:32

writing a fourth book about this. There's three of them behind me already. So, there's I could go on and on about

30:39

this. I maybe you could be more specific, but let me pick a few if just to try to be helpful. Good practices and

30:45

habits to get into. Um, geez. I mean, because we could talk

30:50

about management, we could talk about marketing, we could talk about investors, we could talk about, you know, product development. There's there's lots and lots of questions

30:56

there, but I guess, man, I'm not even sure where to start. I

31:02

mean, it's it's really about work ethic and and delivering what you promise. Um, in the context of this show, we mostly

31:08

talk on this show about fundraising strategy. So, let me let me take a lens on that like so that investors will want

31:14

to work with you. Investors are looking for someone who can deliver what they

31:20

promise. Uh it may not work out the way you expect, but the key is that you are

31:28

adaptable and will work hard to succeed anyway. They call that resilience or

31:33

grit. And that is really what I think we're looking for when we uh meet

31:39

investors, sorry, when we meet founders, especially if they have new ideas that are sort of unproven, which is the

31:45

exciting stuff to be honest. There's this metaphor in investing about

31:50

whether you invest in the jockey or you invest in the horse. And the horse is the business, the business model, the

31:56

team, um the market opportunity. It's all those other things. And of course, the jockey is the CEO, the founder or

32:02

the co-founders who are the people to do this. And at the earliest stages, which again what this show is mostly talking

32:08

about, early stage investing, the jockey is critical. And the thing we're most

32:14

looking for, there's the obvious things. Are they smart? Will they work hard? Are they honest? Uh can they attract other

32:20

people to work with them and believe in that vision and contribute to it? And other people means not just um

32:26

customers, but it means also teammates and colleagues as well as investors, right? You've got to convince everybody

32:32

that you're going to make this happen. And that's what I'm leading to. The best practice to get into is to demonstrate

32:38

resilience. You are the person who is going to make this not only possible and

32:43

not even just probable, but inevitable. That's who we want to invest in. We want

32:49

to invest in the person who's going to really make something happen. And that's a rare thing as you know

32:56

right there's very few people in the world who actually make things happen. Um as the old joke is there's three

33:03

kinds of people in the world. There's those who uh make things happen, those who watch things happen

33:10

and those who wonder what happen, right? And most people are the third. So we're looking but we're looking for the first

33:15

those who make things happen. Um, and that's the opportunity is to to try to

33:20

be inevitable, impressive, and confident. And uh, like Paul Graham, the founder of Y Combinator, is famous for

33:26

saying, how do you get an investment? Be investable. So, that's kind of vague.

33:33

Maybe that didn't didn't answer your question, but but a lot of the other more specific tactics that you might

33:39

have been asking about fold into that, right? So, do you have to get up at 5:00 a.m. every morning? Not really. Do you

33:44

have to have gone to Harvard? No, of course not. Uh, you know, there's lots of other things, but it comes down to,

33:50

are you a person who's going to get done? That's that's what people want to see. Okay, so I hope that's helpful. You

33:57

again, you can be more specific. Uh, if you'd like, uh, banana bread. Okay, Michael, uh, if you are still with me

34:04

here, I'm going to bring you on and let's hear what your situation is. There we go. Hey, Michael the Mollisk.

34:12

Hey there. Yeah. Hey, how are you today? Good. Nice to meet you. What's going on? Oh, it's a pleasure to meet you. I uh I

34:18

think we may have met at a TCVN event. Oh, okay. That's the connection. Or maybe if you're affiliated with Cal State

34:24

Fullerton's startup incubator. Sure. Sure. Yeah. It's it's really nice to nice to

34:30

see you. Great. You too. So, you lost your job. I'm sorry to hear that. No, no, it's okay. I uh I pivoted around

34:37

three four months ago. Um, I had the opportunity to work with a nonprofit that works with foster youth and uh,

34:44

mental health uh, patients who were dealing with complex trauma. And so taking that pivot away from being in

34:52

sales positions, I'd worked with startups. I took it on because I really enjoyed the message and I had a

34:57

colleague that worked uh, uh, he worked there and he went to university with me. So I kind of not to say I I he he really

35:07

believed in me in my undergrad and I kind of owed him in that sense. I really wanted to pay it forward and kind of be

35:14

like a driving workhorse to see his vision through. And I was able to do a lot in kind of that short time. And the

35:21

reality of nonprofit is again it's the first thing we get cut oftentimes is marketing. And so that was the reality

35:27

that I was dealt today. It was a a rainy day. Yeah. Yeah. Okay. Not a bad thing at all.

35:33

Yeah. Well, so what's next or how can how can we help? Yeah. So, I have been working on it

35:39

quite a bit. Um, I'm currently pursuing my MBA at Cal State Fullerton. And my

35:46

interest in marketing at the core of it is human connection and an ethnographic

35:51

approach. And with media marketing, with doing workshops, with traveling, uh, and

35:57

being an MBA student, my biggest bottleneck is funding. and simply getting from point A to point B,

36:04

leveraging a digital platform has significantly helped and I've been able to get a good following. But it's those inerson environments, uh, I've seen that

36:11

working in the foster system with those students and these youth there and having that presence is way

36:18

more impactful than, you know, coming down or zooming in, sending them a video.

36:23

For sure. This is for video to inspire, but also to have that presence, show the community you care, uh, to take action.

36:30

That's kind of my my bottleneck. So, what's the question? I hear you. I agree.

36:36

I guess I have a pitch prepared for the Mollisk. Uh that's kind of my my company

36:41

with marketing if uh Okay. If I would if if I am to to pitch it if that's okay.

36:47

Sure. Yeah. You want to do a pitch? Okay. Yeah. Cool. Let me put on Oh, go ahead. Sorry. Let me put on the timer. It's two

36:53

minutes. Did you hear the explanation earlier of the format? Yes. Yes. Um, uh, it's sort of an

36:58

elevator style. Yeah. Okay. I'm hoping I got it down, but I I

37:03

will be going off of notes, so I hope I'm not cheating. That's fine. We're here to practice. No, no sweat. Nobody's writing checks

37:09

tonight, and you don't have to be perfect. So, it's cool. I appreciate that. Thank you. All right. Okay. Here we go.

37:14

Yeah. Go ahead. Most brands don't fail because they lack creativity. They fail because they can't

37:19

adapt fast enough. Hi, my name is Michael Burak. I'm the founder of the Mollisk, a media and marketing company

37:25

built around adaptiv adaptability. I have to adapt to that word myself. In nature, a mollusk like

37:31

an octopus survives by reading its environment and adapting instantly. That's how brands need to operate today.

37:38

Before building the mollisk, I worked with organizations like Adobe, Rotary International, and the Walt Disney

37:43

Company, which shaped how I think about storytelling, community, and brand at scale. I'm also pursuing my masters in

37:48

marketing to pair creativity with strategy. I saw that most brands are too rigid in a constantly shifting world and

37:54

that's where I come in as the mollisk. I focus on adaptive storytelling using an ethnographic approach to understand how

38:01

people act are actually behaving and building campaigns that resonate and convert. At its core, I'm investing in

38:08

people helping them believe in their ideas and finding the right mediums to communicate effectively. Whether that's

38:13

workshops, storytelling sessions, and live events, I look to open doors to larger campaigns. Right now, I have a a

38:20

live website, a strong portfolio, and the foundation in place. The bottleneck isn't capability, it's distribution. I'm

38:27

raising an initial $50,000 with a path toward 200 grand to scale production, client acquisition, and reach. This

38:34

model is built around 2,000 to $10,000 brand packages with expansion to larger campaigns and experiencing our

38:40

experiences targeting $25,000 to $75,000 in monthly revenue as I scale. Beyond

38:47

capital, I'm looking for reach. So, media, strategic introductions, and strong networks. I'm also exploring

38:53

opportunities like that of Small Business Administration, California Arts Council, and Hello Alice to raise

38:58

additional funding. At the end of the day, I'm building this regardless of funding, even if it takes the shirt off

39:04

my back to do it. And the right support just accelerates it. So, the Mollisk is a creative partner and platform for

39:10

people and brands that want to evolve, not just go with the current. So, I hope you'll take your bets on me.

39:16

Wow, that was You hear that? It just kicked off. Hey, two minutes. Exactly. Two two minutes. Nicely done.

39:22

Well, that was very nicely done, Michael. Um, I'm not sure you're in the right place, but I want to try to I'll

39:30

share you benefits of my experience. Anyway, that was very well done. You have a very nice, honest approach and

39:35

you're well spoken. Um, I can imagine it would only be better if you had it kind of internalized and weren't reading

39:40

notes. You're going to be very good at that part of it. That that I don't have any concerns there. Congrats. That's that's not easy to do.

39:47

So, um, yeah, and it's compelling. I mean, you you I think people would would be interested in hearing for for people

39:54

that do that kind of thing, they would be interested in hearing. The issue is that

40:00

it's not a venture capital type business. So, um, so more like, so I don't have any

40:06

problems pitch. Well, I guess, okay, let's one thing at a time. The pitch, the pitch was very good. I like in the

40:11

sense that it gave you a sense for what you want to do, where you see the need. you were good about saying like who the

40:17

target customers are. I particularly like the fact that you quantified them campaigns of two to 10,000 and then

40:22

growing up to up to $75,000 campaign. Like that gave me a sense of the market range which is very helpful because

40:28

again investors eat numbers like we need the numbers to to size things. So that was that was good. Um what I didn't

40:36

understand is and you don't have to answer me but this is for you like why do you need the money right? if if this

40:42

is just you and you're a brand guy, what's the money for? And don't don't answer me. We don't have time to debate

40:48

it, but I'm just like a venture capital pitch is usually I need more than 50 grand because most most venture

40:54

investors like it or not, they're rich and they'll just say get that from your

41:00

friends and family or put it on your credit cards and you may not I certainly didn't have friends and family that kind of money or credit cards of that credit

41:06

limit when I was starting out, right? So that's not a fair response, but that is the response you'll get. Like if I put

41:12

you in front of a bunch of my vets friends, they'd be like, "Well, just do that yourself." So I don't know for you whether that's possible or not, but

41:18

that's the reaction you're going to get. It's not enough money to interest investors. So it's kind of like what I said to Mustafa a few minutes ago. He

41:24

wanted a million five and I said you should probably do 500 or 5 million for you. If it's under 100,000, nobody's

41:31

even going to talk to you because it's not that's not a venture investment. that's a get a job and or or sell your

41:38

car or you know something more like bootstrappy, right? Um and the problem with that and the

41:44

reason that is is because um the business model of an agency generally is

41:49

not a venture capital backed model because it scales when you hire more people and software type investments are

41:56

grown based on the uh the scaling of software, right? So if Facebook adds another thousand users, it doesn't cost

42:04

them hardly anything, right? because it's all just software. If you add another thousand customers, you're gonna have to hire like 900 more account

42:10

executives, right? From what I'm understanding, and maybe misunderstanding, but so unless you have an AI or software play in there that

42:18

scales this for you, it doesn't sound like a venture investment. That doesn't mean it can't be a fabulous

42:25

business. I mean, I have an uncle who kind of had a business like this back, you know, back in the day and he did great, you know, but it was a people

42:31

inensive business and he's out smooing and taking people to lunch and playing golf and, you know, and that's a great life, right? I mean, if you can do a

42:38

million, two million, 10 million a year, dude, you don't need venture capital. Go do that, right? So, it's just a

42:44

different model, right? So, um, so like as your friend, I think you're a great pitcher. I can see you'd be good at what

42:50

you're claiming you're going to do. I don't know that you're in the right room for me or people like me to help you.

42:56

So, what I would suggest is to more network with people who have had success in the marketing world or the agency

43:03

world and get them to be friends and see if they'll invest because they would understand and appreciate the model more

43:09

than say tech investors will. I I appreciate that. Thank you. That makes sense. Yeah. I think if if there's an

43:15

opportunity, if there's anyone in VC who is looking for a marketer or someone to help tell their story

43:21

or even in that sense if they know someone who can point me to those maybe tech companies that would like to again

43:28

if they would like to get involved and whether they have a piece of hardware or it is a software that could you know be

43:33

promoted through this sense. I already have again the Adobe network is interested in being a part of it through their educational backing but

43:40

getting more support of there's the software the hardware and then kind of just like the the landscape I guess to

43:48

which it's performed. So interesting. Well it sounds like you might have something there. Maybe the

43:53

pitch just needs to evolve a little bit and talk more about this kind of network idea that you're building because that's

43:59

another form of leverage. It doesn't just have to be software. If for example, you had a YouTube channel with a million subscribers already,

44:06

you'd be you'd already have a sense of a different kind of leverage, right? And um so yeah, you might have something

44:13

there. You're here in Southern California, right? You think we met somewhere? Yes. Uh I I live in Corona, California.

44:20

Corona. Okay. Yeah. Um so the the Orange County Startup Council that that I run, as you probably know, um you um you're

44:27

probably on the email list. That's probably how you heard about it. But um uh there's a lot of resources there and

44:33

the events there um that we we have a calendar there. You should just go to the events and meet people and there are

44:39

a lot of people who um Yeah. Like TCVN, right? Did you

44:44

mention T? Yeah. Like Tony, you know Tony at TCVN? Oh, he's he's amazing. Yeah. And Yeah. Yeah. I mean like you should you

44:50

should contact Tony and see, you know, if you can help him out or get involved somehow. I think to the uh the point too

44:56

of the event space like when I found out that I did get laid off I was kind of like wow I have so much time to go to

45:03

Rotary meetings to go to these kind of events and when you're working in nonprofit

45:09

I think that there's a certain demand and there's there's a willingness to really overperform because every time

45:14

you make a video it's an appeal that can then get the kids Legos or it can get them toothbrushes or or whatever it is. And

45:21

so I think as much like I was working really hard and like a lot of hours to to do it

45:27

and to reallocate that and like the framework and the structure that I had developed while I was in this position

45:33

too. The different kind of nurtured mindset you know again like a nonprofit versus a startup kind of culture.

45:40

Yeah. Changed my approach a bit. It was more of a walk through the garden in a sense rather than like through the fire and

45:47

the flames of like you know startups how they kind of start. Yeah. It was a different a different tone, which was was nice. And I think

45:55

it's like if I stay in one industry for too long, I kind of am I'm eager to see what else is out there and how I can

46:01

apply what's going on to something else. Well, that suggests that you're in the right place in terms of thinking about an agency because that's one of the

46:07

benefits of an agency model is that you get different projects. You work in hardware this week and restaurants the

46:12

next and then sports, you know, like you can mix it up for yourself and take clients that you want. Um,

46:18

yeah. Well, I wish I had more specific advice for you, but I I I feel like you've got something there. You're just

46:23

going to take some massaging and um look at the calendar that we have on the OC startup council site. There's a bunch of

46:29

events coming up. Um and I think you should like get out and mingle and just talk have this same conversation with 10

46:35

more people. Um like give yourself a goal. Find 10 more people to have this conversation with in the next whatever

46:40

three weeks or something. And I think you'll level up quickly because you're you're at that point now where there's

46:45

something but you're not at least I'm not quite sure what it is. And and you're kind of massaging it and and I

46:51

bet uh bet you could find something pretty interesting. I appreciate that. I think one way is

46:56

even articulating like my presence when I do go to set events because I don't want to like Palmer Lucky is like overly

47:03

casual when he goes to events like that. But also being too corporate looking like I think

47:08

even just the network or someone to give feedback in that regard of how professionals look. Again, I apologize.

47:13

I'm in actually we're in t-shirts so it's Yeah. No, we're both were Yeah, it's fine. Uh but uh I think that piece of of

47:20

those best practices or you know like that adaptability and I like that you said evolving because that's the theme

47:26

of them all is because you start as one octopus and then you like usually there's only one octopus in an

47:31

environment which is the most challenging thing when there's another octopus. It's like sometimes there's a little bit of a standoff, you know, like

47:37

a Texas showdown. Um, but ultimately it's there to protect the ecosystem and

47:42

make sure that everybody's like looked after. And you know, as much as I have eight tentacles, like they're all spread

47:47

thin because I'm doing consulting, marketing, you know, right? Graphic design. And I think as a grad student especially,

47:54

like that's that's true to the uh Chipotle bowls that I eat, you know, it's Yeah. We're gonna have to move on here,

47:59

but one last quick one. You said you're MBA student at Fullerton. Is that what you said? Yeah, Cal State Fullerton.

48:05

There's a new director there. Maybe you've run into Scott Taylor. Yes. Yes. Um he proposed uh doing some

48:11

work and I think the the funding just wasn't there quite yet to I see to merge and to have that work done. But

48:18

I I proposed however I can support you know in that way of letting you know. Yeah. Well even if I mean of course you

48:25

need to be paid but if you got to volunteer to start sometimes that's a good way to get started. Um, and last

48:31

and I'm going to have to go to get on to some other people here, but the um in the fall and October they're going to do

48:37

the um SoCal Celebrates Entrepreneurship thing, which is a consortium event. Um,

48:42

and I'm sure that we're gonna I'm part of that peripherilally. I'm sure we're going to need marketing help, so that

48:48

might be a way to get in on things. I would love to to help however I can. So, I I appreciate you taking the time

48:54

tonight, too. Thank you. All right. Yeah. Well, nice to see you again. Hey, great, too. Thank you.

48:59

All right. So, that was Michael from Corona, California. And uh interesting story there. I don't know. Am I crazy or

49:05

did he have some interesting ideas there? I hope that uh I think he's going to land on his feet. It might you might

49:10

have to bounce a few times, but hopefully hopefully that's going to come together for him. Um all right, I'm

49:16

going to head back to the chat room here and uh see what else we can do to help people here. Let's see. This is the

49:24

point of the show where I often get people actually want to know if they can work with me directly. So, I I don't do

49:30

a lot of one-on-one work anymore because I do a lot of this. I speak and at events all over the world and I uh judge

49:36

pitch competitions and I write books and and I broadcast. So, if you want to work with me directly, this page will uh talk

49:44

about that. But it's expensive. I'm just warning you. So, because I don't have much time, but if that's if you really

49:50

do and you're ready, especially if you're like a growth company and you're in revenue already and you can afford it, I can I can help you like one-on-one

49:57

with calls and things like that if that's uh what you are interested in. Um,

50:03

yeah. Okay. So, then um

50:11

let's see. Okay. So, yeah, I wanted to put this up. We have several groups on

50:16

LinkedIn that I don't talk about much. Um, but this is a private group just for

50:21

uh startup council friends and family. So, if that's interesting to you, um, go

50:27

go join us there because that's free. And then, of course, visit startupconsil.org to join us as a member

50:33

because that's really where the action is these days. All right, let's get back to the chat and see. I know a number of

50:38

interesting questions have come in here. Um, let's look for

50:46

where were we? Okay, we did that. We did banana bread. So, Manuel says,

50:51

"Have you heard of investors partnering with general contractors to build and split the profit at the end of the

50:58

project?" Uh, I guess you mean construction projects. Um,

51:04

I No, I haven't. But Manuel, that's not my expertise. This show is really about technology investors and investments

51:11

like software and hardware or maybe medtec devices. Um what you're saying makes sense logically, but it's not my

51:18

expertise. So I don't know. Um I'm trying trying to be helpful

51:23

investors partnering with general contractors. Um yeah, I don't I don't have any insights there for you. I'm

51:29

sorry. This is really about a venture capital kind of investments. Um, just as

51:34

a thought, you might look for I don't know where you live, but you might look There's two resources that I often

51:40

recommend that might have helpful advice for this. One is the SBDC. I'm assuming

51:46

you're in the United States. Anyway, I can't really tell, but um, Small Business Development Corporation is a

51:51

taxpayerf funed service, meaning your tax dollars. And SBDC um, they have

51:58

offices all over the country and they do business consulting for free. So there would likely be someone there who would

52:05

have an opinion on this that would be better than mine because I'm like I'm a software guy. That's kind of the opposite of what you're asking. Um so I

52:12

would Google SBDC and the other one is the um score uh S is just like it sounds

52:18

S co and it stands for service core of retired executives and that is also a

52:23

volunteer uh the SBDC has actually paid people with the score is a volunteer

52:28

group of retired executives and there are people from all kinds of industries who volunteer to help coach um people

52:35

who aren't retired younger people right of with their expertise. So, I don't know this because again, for the third

52:41

time, I'm not a contractor sort of person. Uh, but I'm sure if you're Oh, you're in Orange. So, you're here. So,

52:47

if you're in Southern California, there's a lot of contractor expertise, right? So, I wouldn't be surprised if

52:53

some of the people at the SPDC and at SCORE would have the kind of expertise that could be helpful to you. Uh,

52:59

because unfortunately I don't, but um I wish I did, but um I So, there you go.

53:04

Does anybody in the chat room have suggestions for Manuel? maybe they have a better answer for you. But maybe those

53:10

uh hints, those clues will give you a step forward on your on your pursuit. Good luck because that that sounds like

53:15

a good opportunity. And that's the way you know every I will say every project has a financial partner or sponsor. So

53:24

again, I don't know that world, but I do know that you know you've and you know better than I do like construction loans

53:30

and there's lots of ways to finance things and if you can offer a compelling return on your investment then there are

53:36

people with money around the problem is just of course finding them. So I would start with uh uh uh help uh with the uh

53:45

SBDC and maybe score. So um okay score. Thank you. Thank you Harl. Score is

53:51

good. Thank you. And Dr. Sanjay says he can help Manuel. Uh so maybe you two can

53:56

find each other on LinkedIn. Um and Manuel says thank you. So of course yeah happy happy to help. I only have have a

54:03

lot of different expertise but that ain't one of them. So um all right let's go on to the next one. As startup

54:10

council was the single most critical capability a founder must build today to create a

54:16

war resilient and globally dominant startup. Wow that's a good question Dr. Sil or no you're not doctor sorry Sunil

54:24

Kumar Singh um the single most critical capability a founder must build today well revenues I mean maybe you probably

54:31

meant something more sophisticated than that but um it's surprising to me the number of

54:37

founders who forget that they're in business to make money and the point of

54:44

revenues is that not only will they pay for what you have you know you're doing

54:49

today your expenses today, but they allow you to keep going and grow, right? So, um, if you have good revenues, that

54:56

covers over a lot of other problems. Product defects, customer service problems, legal battles, bad staff, good

55:03

staff, time zone differences, what, you know, whatever your problems are in your startup, if your revenues are going, you

55:09

know, up up, you're going to figure it out, right? Because you can pay people to do it. So, that's the thing I would

55:15

really look at growth as the number one answer. Uh I particularly your question is timely of course Sil because of the

55:21

war resilient and globally dominant startup. Um I think maybe you said you were in India right so I think you're

55:27

probably feeling the um Iran attacks u more than than we are here all the way

55:33

in California right but it certainly is a factor and it's making everybody question their supply chains and the

55:38

resilience of their infrastructure. Um so uh I don't have a single factor for

55:44

you but um

55:49

yeah diversifying your risk trying to keep growing um and demonstrating

55:54

demonstrating resilience and uh trying to um have a diversified approach to

56:01

your supply chain and to your team even like it's turning out that having remote teams is actually good in some ways

56:08

because you know uh if one area the internet goes down or they don't have enough oil to keep the lights on, you

56:14

know, then you have people in another region maybe who can pick up the slack. So, this is kind of a new hybrid work

56:19

environment. We're working with all of us to figure out how to be resilient. And everybody thought data centers, for

56:25

example, nobody thought about how vulnerable those are to drone attacks, right? And it turns out they're big

56:31

targets, big bullse eyes on the roof essentially, and that's a problem. So, I

56:36

think you're right to be thinking about that. Um, and I wish there was a single answer. Um, and anybody has suggestions

56:43

in the chat room again, let me know. I'm happy to happy to dialogue about that. It's complicated. Um, I just wanted to

56:51

say hello to to South Korea. Nice to have somebody in

56:57

from South Korea as well. I don't get too many of you folks. So, nice to nice to see you. Uh, I do this at this time

57:03

zone so the people in Asia and Australia and India can join us easily, right? It's nighttime here in Southern

57:09

California. So, I'm glad to see you here. Uh, Mong Duckley and uh, Harl was

57:17

uh, clapping for something we said, I guess. Uh, great executive summary. Oh, that was for you, Mustafa. Mars thought

57:23

you did a good job, I think. Let's find these last few questions before we wrap up. D. Okay. Regggd D versus Reg CF.

57:31

Yeah, that's a good one. Um, thoughts for early raises. So what Aaron is asking about there is these are two

57:37

different uh legal regimes. This is in the United States. So the different two

57:43

different securities laws um sections that allow startups to raise money.

57:50

You can't just sell stock to the public, at least in the United States. And I think that's true in most countries

57:56

because people get into lots of games about ripping each other off basically. Um, so, so at least here in the United

58:04

States, you can't just sell stock to the general public. If you're going to sell stock in an early stage company, it's

58:10

supposed to be to what we call accredited investors, which people who have real assets, a few million dollars

58:15

sort of thing, who can afford the loss basically. So, um, the regggd and reggg

58:22

cf reggg stands for regulation. So, regulation D and regulation CF and the CF starts stands for crowdfunding. So

58:29

the difference between them very roughly speaking and I'm not an expert here so anybody who's listening go ahead and

58:35

chime in and correct me but more or less regggd is for um sophisticated investors

58:41

and larger amounts of money. Very simply put regf is this new thing called

58:46

crowdfunding which means that people without millions of dollars in assets can invest like small amounts like a

58:52

$100 or $500 or $1,000 and they don't have to be accredited. uh but you can

58:57

only raise up to I think it's $5 million. So it's kind of a different vibe basically. One is kind of like the

59:03

big boy insider game that has traditionally been uh the paradigm that Wall Street has operated under. And then

59:10

reg CF is this new thing. It really kind of got started in 2016 with the jobs act under President Obama, but now it's 10

59:15

years old and it's quite healthy with platforms like Weefunder and Start Engine and uh Republic and um uh Net

59:24

Capital and Title 3 things like this. So they allow you to list your company

59:32

publicly and promote the investment to say come buy shares in my company to the

59:37

general public. So that that's historically not allowed since the uh the glass

59:43

deagle act and the uh the different laws that were passed after the great stock market crash back in 1929. And at least

59:50

here again this is all in the United States. Um so regggd is kind of for 5 million or more

59:58

from sophisticated investors and institutions. REGG CF is more for smaller uh crowds of people who may not

1:00:05

be as sophisticated. So thoughts are um it depends on who you know and what kind

1:00:12

of uh reach you have. So regggd is for bigger investors with more

1:00:20

money. If you know them and you can raise say 50 million or hund00 million then do that obviously I mean if you

1:00:26

have good use for the money of course. Um the real question kind of inherent in your question is reg CF crowdfunding is

1:00:34

amazing like it's a there's a a platform I'm in I'm literally investors not both

1:00:39

on but in uh start engine and we funer and king's crowd and a bunch of companies in that space. I think it's

1:00:44

amazing and and exciting. It's a whole new asset class and um uh in fact

1:00:49

actually Erin you should watch for this um on the 13th through the 15th of

1:00:55

April. Anybody that's interested in crowdfunding, the um investment crowdfunding week is coming online. It's

1:01:02

a three days of virtual seminars and uh presentations and panels, all free

1:01:08

sponsored by King's Crowd, this platform I just mentioned. They're like the leading data analytics for the crowdfunding space. And it's all free

1:01:15

and I don't have the link on me, but you could Google it. Kings Crowd, that's one word, Kings Crowd, Investment

1:01:21

Crowdfunding Week, April 2026. and you'll find the links and you can go and there's going to be amazing like Tim Draper and a bunch of big speakers and

1:01:28

stuff and um I was posting about that on LinkedIn today. You go find me on LinkedIn and you find the links as well.

1:01:34

But anyway, um crowdfunding is great if you don't know the big boys and also if

1:01:40

you have an audience that is likely to want to invest in smaller amounts.

1:01:46

And there's two parts of that. Smaller amounts meaning they're not accredited investors. But also the first part um

1:01:52

that you have an audience and that's the key with crowdfunding. It's not magical like you put your

1:01:58

offering up on one of these crowdfunding platforms and then suddenly people show up and throw money at you. You need to

1:02:04

have a campaign, a marketing campaign to reach people who are interested in your

1:02:10

company or at least your kind of company. Ideally, in other words, you come to the crowdfunding platform and

1:02:16

use them for the administration of the offering, all the legal and uh documentation uh follow-up sort of

1:02:23

administration because that stuff is important and it's it's legally required. Um but the outreach is not

1:02:31

something you can necessarily count on them for. You need to bring your own audience. So now that I've given all

1:02:37

that background, if you have a company that needs large large amounts of money

1:02:44

for stuff that is not easily understood or is technical like say an advanced medical device or some deep tech thing

1:02:50

or something that's going to take many years to to develop and is kind of

1:02:56

sophisticated, I guess in a sense, regggd is probably what you're going to have to do. Reg CF works best with

1:03:04

things that the average person is going to understand and get excited about. So, as I don't know how much experience that

1:03:10

everybody here has with um crowdfunding, but like some of the big products there were like a a cooler that uh had

1:03:18

Bluetooth speaker in it and rolls, you know, like oh, everybody can understand that and a bunch of people bought it,

1:03:23

right? or, you know, specialized uh consumer products or like gluten-free food or or like one of the first

1:03:29

crowdfundings I ever did. How how many of you remember the movie Robocop? Roocop was set in Detroit. I grew up in

1:03:37

Detroit and like 15 years ago, this is really one of the first crowdfunding things ever. Um there was a Kickstarter

1:03:43

campaign. This wasn't equity crowdfunding. It was just general crowdfunding, but uh was we all contributed to build a statue of Robocop

1:03:50

in Detroit. So that's the kind of thing like if it catches people's imagination and they can chip in 50 bucks or 500

1:03:57

bucks instead of 50,000 or 500,000 then that's more the vibe for crowdfunding in

1:04:04

general. So um probably again some of you have um experience with crowdfunding

1:04:09

and if you want to post in the chat room or later if you're watching this later in the replays on YouTube you can post questions or comments to follow up

1:04:15

there. I hope that's helpful. John says, "Uh,

1:04:22

hold on here. What else we got?" Okay, this look like this might be our last one.

1:04:29

Oh, okay. I just want to put the John I'll answer that question, but Banana Bread uh appreciated my enjoying their

1:04:35

uh name and uh general advice. So, I guess I hope that was helpful.

1:04:42

Let's see. Okay, so this I think will be our Yeah. Okay. Our probably our last question this evening. Yeah. So, John

1:04:48

says, "How often do angels or VCs want to examine a startup's financials after an investment?" That's interesting. I

1:04:54

get this question a lot about uh the financials before an investment, right? The um Oh, Erin. Okay. Sorry. Just I

1:05:01

want to hit that back to Erin. You're still here. So, if you have any follow-ups on that, go ahead because I can hit that again before we leave. It's

1:05:07

there is a big distinction between D and CF, but it depends a lot on the specifics of your company, right? Um so,

1:05:15

if that was helpful, fine, and we're done, great. But if there's a follow-up, let me know. Okay. So, John, um, usually

1:05:21

people ask about what financials, the proform as they call them, the projections are needed before they raise

1:05:27

money. And again, that'll be in my new book. But, um, how often do they want to see it after? That's a great question.

1:05:33

You know, there's not a straight answer on that. The general idea is if we're

1:05:39

talking about early stage startups, which is what we're usually talking about here, you will have developed a

1:05:45

relationship with your investors ideally anyway, right? If you have investors who you only talk to every other year or

1:05:52

maybe once a year when you issue the K1s or something for the investment, they're not the type of partner

1:05:59

investors that I would recommend. Uh, and that can be okay, right? Sometimes people have more money than help or they

1:06:05

just maybe they love you. It's your uncle or aunt, you know, and they put in a million bucks and they're fine with it. You know, if you have family like

1:06:11

that, congratulations. Um, but if you're going to um if you're

1:06:17

going to report after you've raised the money, they're going to want to know

1:06:22

depending on the strength of your relationship is what I'm trying to say. So, would they love monthly updates?

1:06:29

Sure. Is that going to take a lot of your time? Yeah. Uh the number one problem I would say that uh maybe not

1:06:36

the number one but certainly a absolutely recurring problem that we have as angel investors is we put money in and then we don't get updated

1:06:43

financials. Sometimes people just ghost us completely. Right. Uh sometimes it takes legal action to find out even

1:06:50

what's going on. This actually goes back to the first question of one of the first questions of the night which might

1:06:55

have been from you actually about side letters. That's one of the things that goes into a side letter that you have to

1:07:01

give us updates at some cadence, you know, monthly, quarterly, something, you know, and you and we have information

1:07:07

rights that we if we don't if you don't hear from us, we have a legal right to come in and look at stuff and find out

1:07:14

what's going on because you took our money, right? So, that kind of thing is exactly what the side letters are for.

1:07:20

and they're going to want to know as much as they need to feel like their

1:07:26

money is being well guarded, you know. Um, so, uh, the reason I made the

1:07:32

distinction about early stage versus later is because once you get into a later stage and you start selling, uh,

1:07:38

like series A type stock, the preferred stock agreements will have

1:07:43

more specific requirements built in like there has to be a board meeting every X

1:07:48

months. The board meetings will require preparation of these kind of financials that shall be delivered on this these

1:07:55

periods to the board. You know it will all get formalized and so it's really

1:08:01

the question it will become clear what is expected in the deal for the early

1:08:07

stage. The problem is that um if you sign a safe it doesn't say any of that.

1:08:13

So everybody's kind of like you know the founder's like I'm busy leave me alone. I'm building your company. Leave me alone. When the investor's like, you

1:08:18

took my money. Like, you got to tell me at least what's going on every now and then, right? And it's just it's a tension that we see a lot. I I'm doing

1:08:25

it gently. It's actually more like this. Bang. And it's a problem. And um that's

1:08:30

why these side letters exist. So, I think that was you that asked and those two questions actually dovetail. Exactly. Um so, the short answer is um

1:08:37

they want to see it as often as they need to to be reassured, right? Um and

1:08:43

uh my recommendation is that you overcommunicate. You want to keep those investors on your side. Not only did

1:08:50

they believe in you early and um both you in terms of your company, but also

1:08:55

you personally, right? They're betting on the jockey. So these people have a personal stake in you and they believe

1:09:00

you, right? You owe it to them to keep them updated even when things are bad because the sooner you tell them when

1:09:06

things are bad, the sooner they can try to help you because they've got their money in it too, right? And their reputation. So we are incentivized. We

1:09:13

want to help but we can't help unless you tell us, right? And of course if things are going well, we like to hear that too. The problem is it takes a lot

1:09:18

of your time to deliver that. This is where AI is really going to help a lot, right? Because increasingly things are

1:09:25

platformized and um you know you can run your QuickBooks reports with a couple clicks and then maybe use AI to massage

1:09:31

it and send it out kind of automatically. So this is gradually evolving. But as a founder, as a human,

1:09:37

you have to be in the default setting of I'm going to communicate because if you don't, not only can it lead to um upset

1:09:46

formerly friends and legal action, but on the positive side, these people are you're most likely future investors,

1:09:53

right? Unless you're never going to raise money again, you need these people. And even if like say your next

1:09:59

round is going to be 5 million and you're too big for angel investors, well, who do you think the the VCs are

1:10:05

going to call for references? They're going to call your old investors, right? And if your old investors say, "Yeah,

1:10:10

you know, I like those folks at the beginning, but they, you know, they wouldn't give us any information and they were a pain in the ass to deal with

1:10:16

and they ghosted us." That's not a good look. So anyway, that's uh that's kind

1:10:22

of that. So I hope that's helpful and I think we're about done here. What else we got in the uh chat room? Uh thank

1:10:28

you. Good. You guys contact each other. Erin says, "Thanks." Otisier

1:10:35

says, "Great points and pointers." You're welcome. And uh John, excellent. All right, gang. Cool. Well, that was

1:10:42

fun. I hope it was useful to you. We'll be back again uh before too long to do this again. And let me remind you before

1:10:48

you leave. Um let's see. Oh, not that one. Oh, actually that one too. If you want, if you go to conferences and you

1:10:55

like conferences about startups and stuff, this is the only worldwide calendar I know of startup events that

1:11:00

we built and it's free. But that wasn't what I was looking for. I was looking for this one. Yeah. Come. Oh, like and

1:11:08

subscribe. Actually, that's the thing. Can you please click to like and subscribe, whatever platform you're on, LinkedIn or YouTube or whatever. Leave a

1:11:14

comment, please. Like and subscribe, forward to your friends, all that stuff. Blah blah blah. all those clicks really

1:11:20

do make a difference uh in terms of the algorithm and it means that I can keep doing this because if I do it, you know,

1:11:25

for only a couple people and nobody reacts and I'll just stop doing it. That's fine. I got other ways to spend my evenings. But be happy to I'm happy

1:11:32

to try to help. Um and would love you guys if you could uh return the favor with a couple a couple clicks. And the

1:11:40

uh real point here, the takeaway is go join Startup Council. um it's for you and it's full of discounts and services

1:11:47

and um all kinds of stuff that I wish that I had had back when I was a firsttime founder. So there you go.

1:11:54

Thanks for watching. Hope to see you again soon. Tell your friends, like and comment and click and come join us at

1:12:00

startupconsil.org. We'll see you next time. Thanks for watching.