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This month's TechTO was a great mix of idealism and practicality. Learnings ranged from concrete, step-by-step tips on building a company and raising money, to big-picture social responsibility practices that can help make the world a better place to live – and your company a better place to work.

The range in perspectives at this month’s TechTO reflected the speakers’ various experiences, products and approaches to tech & to business. May’s TechTO delivered tangible next steps for any tech founder — whether your business is decades old, just starting out, or still a kernel of an idea.

Justin’s Steps for Entrepreneurs to Take Before Asking for Vc Funding:

First to speak was Justin Adler, co-founder and COO of NorthOne, who was there to share his experiences raising money as an early stage company.

“If you think fundraising is ‘us versus them,’ you’re losing already,” Justin began. There is so much hype and competition in VCs and startups, he explained, that it makes the whole process muddy, when in fact it can be a straightforward sales process.

Justin outlined the key players involved in raising money: The VC Analysts, the VC Partners, and the Entrepreneurs, explaining their roles and mindsets.

VC Analysts, he says, want to do well. They need to win, and will get overly excited if they think they have found the next big thing — after all, their whole career is based on finding the next big thing. If they don’t think you’re that next big thing, then they’ll stop answering your emails.

VC Partners, meanwhile, also want to do really well. But for them, their whole day is spent having coffee with people like you, the entrepreneur. They want to demonstrate value to their portfolio companies, so can’t ever turn down a coffee because maybe you’ll be the next big thing. “We always think about VC’s as people in lordly, powerful positions, but they are under immense pressure,” Justin explained.

Entrepreneurs, meanwhile, need to do well. You only get one shot per company, Justin says, and the VC meeting is an important one. Justin cautioned against interpreting a “maybe” as a “yes” and to remain realistic throughout the process.

Justin’s Steps for Entrepreneurs to Take Before Asking for VC Funding:

  • Start the relationship well before you raise. While having coffee meetings regularly are great for face-to-face contact, it is also a time-consuming process. Providing email updates about what you’re doing is far more effective.
  • Understand that funding is a two-phased sales process. The first phase is spent selling to the VCs. Once you get your term sheet, the VCs begin selling to you.
  • Articulate a “hair-on-fire” problem. VCs want to see that you are solving for something urgent and relevant.
  • Focus on traction. Don’t get stuck thinking you have to build a perfect product. When raising, generating interest is more important.
  • Understand that VCs aren’t ATMs. An investor needs to be strategic — and they need to show you how they can connect you to media sources and find other smart people for you to hire. They’re literally becoming a business partner — not merely a source for cash.

Jennifer Couldrey: Building a Corporate Responsibility Strategy

Next up was Jennifer Couldrey, Executive Director of The Upside Foundation, which enables Canadian startups to give back by donating equity to charity.

Jen started her talk by pointing out that more and more people quit a job today because they no longer feel aligned with the values of the company. Employees are looking for more value and purpose, and 64 per cent of people won’t take a job unless the company is socially responsible, she says. Business owners can imbed the concept of purpose into their core business practices, allowing them to distinguish themselves in order to attract and retain the best talent.

Upside Foundation focuses on early stage, high growth companies who want to do good. The process is simple: These companies pledge equity to The Upside Foundation, and when the company has a liquidity event (such as an IPO or acquisition), cash is donated to the charity of the company’s choice. It’s an approach that enables startups to focus on growing their business while reaping the benefits of being a socially responsible company.

Jennifer offered some examples of companies who are doing this exceptionally well.

Salesforce was a pioneer of the 1-1-1 model of integrated philanthropy, which involves pledging 1% of equity, 1% of time, and 1% of product. When they sold in 2004, they gave $5.5 million to charity, and every employee gets six days a year to volunteer. Wealthsimple is also committed to imbedding social responsibility, being one of the first companies to offer socially responsible investing. It’s rated as one of the top workplaces in Canada — people love working there, Jennifer says, in large part because of the company’s social impact. And the founder of a new startup called Quill, in the midst of hiring, relayed that every single millennial interviewed asked her about her plan to make a difference in the community.

When you’re ready to build social responsibility into your business model, Jennifer suggested to start small, and sit down with your leadership team to review your mission, values, and what you can do to make a great impact in your community.

Marc Castel: As a CEO, Your Job Is to Raise Money

The raise of the month featured Fiix Software, which has raised $52 million in the last 12 months.

“Raising money is hard. It’s always hard, and never gets easier,” said Marc Castel, CEO of Fiix. He told the story of how when the company was small, things were going quite well. They had small seed rows, were cash flow positive, and “life was great.” At that point, the company could have gone one of two ways: They could remain a small, successful company, or they could build the company up. The founders took a vote and it was unanimous — they wanted to be a billion dollar company.

“I’m always raising money,” Marc said. “To get to a billion dollars takes a lot of hard work and capital. When you make the choice to venture you can never go backwards – you’re in it for the long haul.”

Marc’s Cheat Sheet for CEOs on How to Get Ready to Raise:
  • Build a great business that aspires to be a billion dollar company.
  • Be discoverable — make it easy for people to find you.
  • Publicly report on your progress — tell the world you’re growing at incredible paces.
  • Always keep your house in order, always be ready to raise at a moment’s notice.
  • Make your investor deck and financial model a living document.
  • Seek alignment with existing investors and shareholders.
  • Build long-term relationships with prospective funders — start about six months out.
  • Stay up to date on market dynamics.
  • Signal the market when you’re close.

As far as who they choose to invest with, Marc said that they are very thoughtful in picking investors who can help them build the business they want to become. They then align with an investor’s cheque size, investment thesis, and ensure their values, vision, rights and exit strategy are in alignment.

When asked how he balances raising money with running the company, Marc had this answer:

“Fund raising is a full-on contact sport. You need to be focused and put the time in, as it’s your job as the leader of the business. Finding great people is number two on my list, and our COO ran the business while I was fund raising. Hire great people early who can run the business while you’re out raising money.”

Marc’s Cheat Sheet for CEOs on How to Get Ready to Raise:

Yang Yu, founder of KitchenMate followed, with a heartfelt story of success born out of some pretty significant challenges.

“Five years ago I was at rock bottom. My company was failing, my family was falling apart, and I moved to my parents’ place,” Yang began.

His mom developed a dietary condition, which was very difficult for Yang, as he couldn’t use any of his skills to help her. Around the same time he flew to the U.S. to visit his daughter, and was served pizza, fried chicken and french fries at mealtime. Understanding that it’s not realistic to cook every meal from scratch, he began thinking about the consequences of eating this way.

On the flight home, Yang started thinking about a way to help his mom and his daughter — he knew he just had to do something to make a difference and decided to commit to solving problems in our food system.

“How could you make a home cooked meal at home cooked prices, without having someone to cook it for you?” Yang wondered.

His solution was to create an appliance that would turn raw ingredients into a cooked meal. His vision was crystal clear — he just had to make it a reality. He took a leap of faith and got started, learning mechanical engingeering and circuitry along the way.

While he managed to build a prototype that convinced and engineer to come on board and an angel investor to give them $50,000, he ended up starting again from scratch with just four months of money left. When investors backed out, he had to tell his team this might be their last paycheque. His mom wondered if he should stop trying, given how long he had been working with no success.

“My whole life I have been chasing ideas, but this time it’s a problem I truly care about,” Yang told his mom. “A great company is not born from a great idea alone, but from a common struggle that starts with you. It’s so hard to build something new — if you’re not deeply connected to the why, chances are you’re not going to make it.”

Last week KitchenMate reached 10,000 meals sold, and next year they plan on reaching 1 million.

Katarina Ilic: Stop Thinking about Scaling and Start Thinking about Optimizing

Katarina Ilic, co-founder of Voltera, rounded out the evening, with her lessons learned from bootstrapping.

Voltera develops 3D printers for electronics, has won international awards for its V-One product, and has been rated the 23rd highest growing company in Canada. But the journey to get here has been a very long one, Katarina admitted.

After launching, their sales were basically zero. At that point they could allocate all their resources to raising venture in Canada, or they could sustain themselves with six months of runway. They opted for the latter.

By Bootstrapping Her Company, Katarina Learned a Few Things:
  1. Take what you can get. Create a business model then generate revenue very quickly. Identify customers who are easy to access, then use them to identify new markets.
  2. Design with profit in mind. When you become obsessed with optimizing profit — because you’re literally using it to sustain yourself — you get really good at having customers give you money and cutting costs.
  3. Make your customers happy. Develop a feedback loop, find out if customers are happy, find out who your super users are, and design an entire product roadmap for those super users. This is where you’ll find product market fit.
  4. Build a team with grit. You want to know your people will be there for the right reasons.

“It’s easy to get carried away with scale,” Katarina cautioned. “Before scaling the engine, you need to know it is well-oiled and working well.”

The more than 700 attendees left with lots to think about. The next event is June 10th and is sure to once again offer different perspectives, thought-provoking approaches, and insights to spark ideas and motivate some entrepreneurial action.