How do you save a round after your lead investor pulls out?

Raise a series B, or sell your company for nine figures. What would you choose? Well, that's what Ed Rizio De la Cruz, founder of Arcus, had to choose between when presented these options. I dived deep into Ed Rizio's psyche and the internal team discussions that ultimately led him to choose one over the other. Ed Rizio knew he had a rocket ship on his hands, but was it time to cash in his chips or to let it ride? Keep watching if you want to hear this underdog to man on top story. Now, on to the show. Hey everyone, welcome back to today's show. Today we have Ed Rizio De la Cruz with us, founder of Arcus. Sold to MasterCard, raised over 25 million. Amazing founder with an amazing story. Welcome to the show today. Hey Jason, excited to see you again. I know, great to it's great to have another chat. You know, last we spoke we're talking about venture studios and you know, looks like you've already made that happen and with the founder school which you can talk about later. Yeah, but before we we get into specifics, I would love for you to just introduce yourself. You know, what led you to launching your company? Thanks Jason. So, um Dominican. I was born and raised in Dominican Republic and immigrated to Harlem when I was 12 years old um and ultimately went from the Air Force being airplane mechanic, Wall Street, business school and then um decided after business school I wanted to tackle a problem that I had seen firsthand which was um money transfers. The process of money transfer hadn't really evolved from the time that I took foot in the US to the time I was graduating from business school at Wharton. It was the same exact process and technology had evolved, but the process hadn't evolved. So, I I thought about how do we dramatically make this process faster, cheaper, better with technology. And I called that company Regali. And so, that's how things got initially started, but I always like to kind of bring up the fact that you started your career actually in the military in the Air Force. How did that set you up? Like, did that set you up for success and create opportunities? What was that experience like that ultimately led to this? Yeah, I think the Air Force was fundamental in my approach towards everything that I do. I think one thing the military does very well is provide a rigor of discipline and precision in everything that you do. I think anyone that knows me knows that I'm a stickler for details, for being on time, for following processes. Almost to a fault, I have to say. It is almost hard to get rid of that. But, that's one of the attributes that really I'm really forever thankful of of my time there. It really set me up for success in a lot of other aspects of life. Well, let's talk about how you kind of transition from business school to investment banker to launching Regali to what eventually became Arcus. You know, tell us about how that journey worked out and when you kind of started to realize that you needed to raise money. Yeah, so I came out of came out of Wharton, decided to start the company. I really had no clue what I was doing. I think most of us, especially coming out of business school, you think you have a clue, but you learn pretty quickly that you don't. And luckily enough, I applied to a bunch of accelerators. None of them said All of them said no. One of them actually ultimately said yes. That was YC, of course. And and very quickly transformed how I think about not only startup, but myself as a leader. And I think the the quickest way YC did that for me is just by giving me access to the right room, putting myself with other people who were further along than me. I remember vividly that our first group office hours were with a bunch of companies that were ahead of us, and one of those companies was Our World Vash. And they were really like moving very quickly, and I quickly saw what the the bar was not down here, but it was way up here. And I knew that in theory, I had never seen it in practice. And it's hard to be what you can't see, but when you see it in the flesh, it's a lot easier to aspire what what the top 1% is. That is, and I think that's why other founders have come on that come from what YC have all said, you know, similar things in terms of the impact of being affiliated to these other high-growth startups having that influence, especially 2013 was a pretty solid year, you know, to be in YC. And I got to ask, is that is that sweater actually 11 years old? Yep. Still still running around in the morning having a body on you. Yep. Yep, I never I don't think they make these sweaters anymore. They just give you a random like, yeah, a random t-shirt. Looks like you definitely wear with pride, so they did a good job. I love how you said like, "Oh, we applied to accelerators, they all said no, but YC said yes." Yeah. Yeah, that that's That's the best one to be in the draw. Yeah, luck of the draw. But no, it's Yeah, I would Yeah, don't call it the best draw. You guys probably had something pretty, you know, solid put together. Yeah, at the time was it was it just you? Was it, you know, other co-founders? How how did you guys bring together the four of us. It was four of us. So, one co-founder from my undergrad, and another co-founder from from business school, and another one from from Google. So, you know, the four of us walked in there. And yeah, I remember vividly like we walked in in there, you know, down the way all the office at the new one. And you have to the left you have like the the Airbnb, you know, boxes of cereal, like uh Obama O's, Captain McCain's, and to the right you have like this dingy little room. And then we we see like Garry Tan, Sam Altman, Alexis Ohanian, Jeff Ralston, Dalton and like they were all sitting right next to each other. Uh yeah, and it's funny thing is like when I went back as a partner they would still remember me. They still remember the interview, which is crazy cuz they've done like 3,000 interviews. Um So, so it was just No, it's a phenomenal right. I love that place. No, it's great to hear and you know, from from what I found it you ultimately raised 25 million for Argus, correct? Correct. So, walk us through that that journey. Like you're you're building this product and and give people context as to what the product ultimately was, uh servicing the Latin market, but uh when did you decide that you needed to raise money and what was that experience like coming out of YC? Yeah, I think coming out of YC the expectation to raise capital is pretty standard. I mean, it's everything's structured around that. So, you know, it's a 12-week program and everything's structured towards, you know, putting together a demo day presentation where you can show off your your growth during that 12-week timeframe. When I went to demo day, didn't raise much. Then after that really changed my pitch and I got a second opportunity to pitch at at the TechCrunch Disrupt, uh which back then was really a big deal. Uh it was kind of like the Um and I got opportunity to pitch a second Disrupt in September 2013. Uh made it to the finals. I got the one live stream on CNBC and about 6 months after that I wound up raising a total of about 3 million dollars seed. And so so which was a lot of money for back then and for seed round. And after that I was off to the races and quickly learned that nobody wanted our product. So, when the uh killing that version of our product and went up raising in small chunks a number of um a number of rounds up until we got to our A in 2017. So, let's talk about that. This is often the untold story of fundraising cuz, you know, in the press, you know, cuz you change your name. You know, you changed your name to something else. Uh so, for by standards, people that are just reading the headlines, it's like, "Oh, where did this company come out of nowhere and raise all this money? Like, oh, it's so easy for some people." And uh you know, that kind of, you know, uh external-facing lens that is not a true example of reality. So, it sounded like you had multiple, you know, pivots and iterations. Like, how did you navigate not landing P- having all the expectations of YC, raise the money, not hit, you know, uh with PMF, uh product-market fit, and then kind of subsequently say, "Sorry, we missed that one, but give us some more money and we'll try again." What was What was that like? Well, part of the the great thing about YC, and I think and I'll say this about a lot of our investors, we raised predominantly West Coast rounds. We had a lot of great folks in the West Coast. I guess that they expected, I mean, this is par for the course. Like, most companies don't hit it out of the gate right away. In fact, you know, again, when when I went back to YC as a partner, I think one of the other partners showed a slide that said, uh 90% of companies fail. Uh 9.9% of them succeed over the course of 7 years and 1% succeed overnight. So, if you haven't succeeded yet, you're on the right track. So, that gives you a little context in terms of like what the natural path is. Uh and I think when you understand that, you feel a little bit less anxious. So, I knew and believed we were on the right path and by every single pivot, of which there were many, there were like four or five, I felt like we were just getting inch and closer towards success. But yeah, it was a grind of 13 to 17 was like a number of small rounds, like a million here, a million there, putting together until on 2017, we we finally got a a term sheet for $10 million from a major bank. And as I indicated in my book on The Underdog Founder, that was pulled with 3 days left to sign. I had to hop on a plane, uh go to a conference in Phoenix, and you know, smooths left and right. I was told, "No, no, no, no, no." I got one maybe, but I got one maybe from a from a fund in Mexico. I flew to Mexico, and in 2017, we all know Mexico uh I took a separate It's on record happen. That was the day I was flying after an emergency landing into a Mexican airport, uh and uh and then my meeting got canceled and told me to go home, and I was like, "I'm not going home. For what? Like we we got like almost we got 3 weeks of runway. What am I going to go home? I will not get on a plane without a solution." So, I got a week later, I got to meet with a with the partners at the at the fund's office, and then by the time I got back to the by the time I got like I got to the airport, they told me that they were going to do it. So, I ended up raising an $8 million round A on November 2017. So, let's unpack a couple things here. Let's talk about the Mexico meeting. Was this your first time ever talking to this firm? Um no, no, no. So, they were already they were part of the round already. So, the the the was coming in the round it was anchored by this bank in the US and the Mexican fund was going to be co-lead second biggest investor. But then then the big bank kind of just do what banks banks do and just decided not to do it with no with no with zero like reason why. And and I told this bank that I'm sorry to find Mexico like give them contacts as to you know, why they have pulled out. Why in fact we were better off without it. And in fact that we were doing very well and our project trajectory and this like the last opportunity they were going to have to be part of this trajectory with us and we thought like they would add a lot of value given a lot of the work that we were doing in Mexico. And and luckily enough for us, you know, they they bought into our vision and mission and they saw it as a strength and and they came in and invested. You know, I always like to joke that as a founder when you're fundraising, you're kind of like juggling a house of cards on fire, running around on a unicycle yeah, cycling around on a unicycle and people are like throwing curveballs at you that are also that on fire and you're trying to like not You're downplaying I feel the situation quite substantially. Like you had three weeks of runway. Yeah, yes. Coming in, puffing your chest, demonstrating a position of strength to have this conversation and you know, get to a successful relationship and an investment. But like what's that stress level like? When you're in that meeting I mean it it was I've never been more stressed in my life. There were a lot of stressful moments of the company. I I would say that's one of the biggest ones. I remember I remember when I I I got the news. It was a Thursday. It was a beautiful day in New York City. Blue sky, you know, great weather. Got the news. I almost felt like literally someone swept a rug from under me. I felt like I was in free fall. I felt so many kind of just a just a just a theology to anxiety. I think it's a founder. You know, we always feel that existential angst, right? That anxiety that something bad's going to happen. And then it happens and then it's almost worse when you feel like, "Whoa, that this hurt even more." So, my anxiety was justified. And I went home. My wife and I shared like I just got married, by the way. I got married like that August. And these news came in in like September. And you know, I was expecting to get a raise from, you know, cuz I was paying myself very little. My wife and I lived in a New York classical 300 square foot apartment in New York City, where, you know, you could you could, you know, touch the window in the bathroom. And yeah, I just I got home. I stared at the ceiling for like hours. My wife came in, asked me what I was doing. I was like I just broke down and cried, man. I was just like I cried. I cried. Cried and like the next morning I got on a plane and just flew to Phoenix. And I just I just talked to everybody that would talk to me, man. And, you know, when I got the when I got like the the maybe, like I had to take the maybe and take a shower on myself and go to Mexico and and I and I think the whole everything happening was like serendipitous. I don't know, man. It's like Like, this is really happening? Like, there's something here. And, you know, I I could have easily like gotten on a plane and and gone back and and just, you know, folded to the company. Like, that's what the average normal person would do. Like, listen, man, this you know, the the world's telling you something, right? Maybe this is not the career for you. Go back with your with your little MBA and get a job like normal people. A cute cute little MBA. Yeah. I don't know, man. I was like I will not get on a plane until I resolve this in some way, shape, or form. Fight through the end. Like, you you win or you or you die trying, right? And I was like, I'm going to not without a fight. I'm not going to go without a fight. And I was like, I'm going to fight to the end, and you know And I'm glad I did because, you know, it's that was only one of many more massive obstacles that you know, like, little did I know that things were only going to keep getting harder, but I just knew that in that moment of time I needed to fight. Yeah, I love that story. Now I see why you wrote a book. You're a great storyteller. You've got a great story. Um yeah, for for those that haven't heard yet, the book is called The Underdog. Yeah, yeah, yeah. Um but uh yeah, I I love these stories because it really just kind of Like, this happens a lot. I deal with a lot of founders in their most stressful moments when it comes to orchestrating a capital raise. Like, I've seen situations where yeah, term sheets get pulled. That happened to me a couple times. Like uh you know, you you just like you can't count your chickens until they've had like you until it's like money's in the bank, you just can't recognize something being done until it's actually there. And that gets pulled out from underneath you when you thought it was going to be there. It's just atrocious. Um So uh but uh you know, I love that story, but you know, I want to take one more step back in terms of the chunks that you raised. Like, the keeping you alive, you know, capital raises. Uh you kind of had your big win, the big capital raise, all that, but like how did you convince investors to keep betting on you? Were these insiders? Did you have to go chase new money? What was kind of the insider, you know, perspective of that raise or the subsequent raises? Uh yeah, the what they call what they call now uh seed plus. I think back then they called it an extension or Yeah, roll rolling seed. Yeah, or seed or bridge rounds, which has a kind of a negative connotation. Uh but they call it seed plus now. That means we're we're we're an innovator, we're ahead of our Uh yeah, I I I it was a mixed bag of like existing and new ones. And I think uh you know, a lot of fundraising, I tell this to the founders I work with, is just it's really storytelling under massive distress. Uh you know, and you need to come from a position of leverage, position of strength. You never You're never asking for money. I think that's the wrong framework. I think what you're doing is you are inviting people to be part of the journey. Uh and investing is just a vehicle in in doing so, right? You you're partnering up together. So, please come on this journey. Yeah, exactly. So, I always approached it that way and and I really did believe that we were on the right trajectory. We just needed to, you know, launch the next feature or do the next product or attack the next market. Um and I did believe that we were on the right trajectory and I think that that belief, that conviction really helped me raise the kind of small rounds to keep us going. And and this is super common. A lot of founders have to kind of go back to the well and that's the joke, you know, founders are always fundraising all the time and yeah, it seems like that was the case for you. But you get that series A, how do you feel after that money hits the bank? It's realized, it's real, and then how do you look at your next year or so? Like how how do you How was that experience for you? Oh, it was great. I mean, I I immediately after that I entered like an immediate honeymoon phase. Quite figurative and literal, cuz Yeah, did you go on an actual honeymoon? Cuz I got Yeah, I got to go to an actual honeymoon. I was literally signing the paperwork during my honeymoon. It's a very traditional founder honeymoon. Uh and it was it was fantastic for, you know, I think 2018 and if you read the book, like it there's a like I skipped from 2017 to like 2019 is because 2018 was literally a honeymoon year. Um like a lot of things were starting to develop. We started building a team, really hitting the ground in Mexico, developing our product. Kind of you know, we had just kind of pivoted into an API for bill payments in Mexico, so we hit our stride. So, it was a very good uh you know, honeymoon phase, and it was kind of really that that the calm before the storm that came right after. It was very much necessary. So, it was a good break, I would call it. Things started to work. Yeah. Quick plug for founders looking for an edge raising capital. Companies on thunder.vc have gone on to raise over a billion dollars since joining our network. It's absolutely free. Just go to join.thunder.bc to get started. And if you leave a comment on this video down below with your company's name and the problem you're trying to solve, you'll be entered to win a free coaching session with me. Okay, that's it. Just comment down below. Now, let's get back to the show. With the capital coming in and the momentum coming, can you add a little context to the audience as far as what the product did? And I think this is also when you did the brand swap, right? You launched the uh the new brand. Uh so just walk us through a little bit of what the product and solution was. Yeah, so we when we closed the A, we uh we had just pivoted uh away from the traditional cross-border remittance product play and into more uh bill payments uh via an API. What that means is basically instead of uh neo banks and banks in Mexico launching their own consumer bill pay um interface and structure, they would just leverage us. Uh in Mexico, unlike the US, things like um bill auto pay or bill payment presentation, it's just not uh as autonomous or asynchronous as it is in Mexico. They like typically you have to take a physical bill and go to um a physical location to pay the bill and and that process doesn't really translate very well on mobile phones. So what we did is we kind of created an abstraction layer on top of all of the local billers that had the API and you know, it was be consumed by you know, any fintech or a major bank and that started to work because at the same time there was this kind of um massive tidal wave of venture capital coming into Latin America. Uh you know, companies like Nubank, Ualá, you know, they were all you know, and and a lot of companies launching wallets back then. And part of the wallet they needed to have like some basic products and one of those products was bill payments. And guess what? We who had the access to to the best bill payment um API was us. It was a very unsexy product that no one really thought about that we would just kind of niche down. Um so that started to work really well uh after we pivoted from Legali to what became Arcus. And uh you know, I know when you you sell to a big company like MasterCard, which we'll talk about in a little bit, there's certain things you can and cannot disclose, but can you share kind of what scale you ended up reaching as a company? And uh Sure. So, we were in 2020, we were turning along, growing, scaling. Uh we were probably probably 100 plus customers, 200 inside like 200 plus customers, 100 plus employees. I think we got up to like 110. Uh and then we had the metric necessary to raise a Series B, you know, typical A is 10 million, typical B is between 25 and 35 million. Um and you give it up, you know, 20% each round. That's the That's the standard, right? Um so, you know, we we were growing and scaling and you know, my wife and I moved to San Francisco to raise our Series B and early that year, and of course, pandemic happened. And the pandemic happened, we we kept raising our B. We wound up uh you know, the world kind of fell apart, so we wound up doing kind of shifting to kind of a rolling close, and that's where, you know, Citi, SoftBank, and a number of players came in. And then ultimately got an offer for a B from a major corporation uh which I can't name, but and then MasterCard came in and offered us uh an M&A deal. And and we actually did we actually did not want it. We were growing very well. We were going to we were pretty dead set on Series Series B, but after reformatting the the the the offer and the structure, we approved it internally by the board and decided to go with the 70 million offer. And just getting to play Captain Hindsight here, looking back on that decision, the desire to pursue the series B knowing what was coming in terms of the market collapse, you know, a couple years later and how it became impossible to raise money. Would you say you made the right decision or you wish you could still be, you know, growing Arcus? I mean, I look like a genius in hindsight, all right? But, no, I think for one end, like Arcus has grown financially, I think. Kudos to Mastercard for doing a very good job at scaling Arcus, well, keeping the brand first, which most, I mean, you know this better than I do, most companies that get acquired don't don't keep the brand. So, they kept the brand, you know, uh you know, changed my logo that I created with but but kept but kept the name. Uh so, they're still alive, yeah. And uh and it's it's still like wildfire. Um and but you know, you're always, you know, as a founder, you always miss operating. It's there's something wrong with us where we miss operating. So, I do miss operating, leading, interacting with the team. I think that was probably my favorite part, like coaching people and helping them scale. Um I do miss those days. But, for the most part, uh I'm very happy with the outcome. I'm happy where I left Arcus, what what's become. I think we feel privileged that that we did sell to a great acquirer that really taken under its wing and and scaled it quickly, you know, to places that we couldn't get to. So, I think it's you know, it's one of those few cases where M&A was done correctly. Right? Um So, I'm very happy with the outcome. No, that's a great story and I love hearing when that actually ends up being the case where all parties win. So, it sounds like investors won, you your team and employees won, and you know, the acquirer won. But, let let let's kind of go into that decision to raise the B. Where it sounds like you were not running an M&A process. You were running a series B process, correct? Mhm. And then two parties came in saying we'll give you cash. Or you know, we'll give you you know, we'll we'll take you off the table. Um and when it came to you mentioned that you wanted to you know, keep at it, but conversations were had, but when it came to like managing your board and like how that board meeting went. Like what was your what was going through your head? How did you look at the options and you what ultimately you know, swayed you towards the the M&A deal, which again ended up being a great option, but you know, what was what was kind of the trigger for you? Yeah, I'll provide some context and I share a lot of the details in the book. So there were there was a lot of things happening at that time. Like on a personal level, I was going through a lot of turmoil. Like you know, my wife and I, we we got pregnant and you know, so on so forth. We had a miscarriage. We had a No, we had a miscarriage. So that that was an issue and and shortly after that I I got really sick with COVID. Um and then shortly after that my grandmother passed away from COVID. Uh and then on top of that I had a lot of internal turmoil, which I put in the book. You know, you know, part of ways with one of my one of my co-founders was like one of my best friends. That really hit home. And my my other co-founder remained with me. We were just kind of fighting like every single day. Like everything was felt like a fight or became a fight ultimately. Um so so we just there was a lot going on and I actually got temporarily like fired. I I went back to the board and I told them, "Look, that's great, but we need to raise capital. And I'm done with it. Nobody knows how to do it. Like let me stay here and raise capital." And then in that process we were starting raising the capital from SoftBank and Citi and then you know, that's how came on and it to offer us USB and then the and then my super command with you know what became like MMA offer like like I'm I'm already running this process so I might as well stay stay here and run it through cuz otherwise it's like me leaving would cause a lot of friction. So yeah it's I like went through all of that and kind of went back in the company to ultimately execute while company became the remaining process. And this is why I like to ask these questions cuz like the first version was we got these offers we took what it was great I was like what was the real going on behind the scenes? Yeah man you know you know you know the difference difference between like the average podcaster and somebody that's that's done it like like you did it so Yeah it's there's so much pain so much pain. Yeah man there's so much there is and there's so many I mean you know this like your line of work is like you know you do an MMA at a particular level like there's so many different communities you have to manage you have to manage your board your co-founder your investors right your your employees as well and the acquirer and the prospective investors right you still have to keep communication so there's all these communities you got to your family and like your it's like why you're not available why you can't say one thing to that person but you can tell the other person this thing I don't know about you guys but we couldn't tell our employees until the deal was actually done you know and it's all right cuz all your employees are like why are we building this this doesn't make any sense like just trust me don't ask questions Yeah no yeah and it's like and and you know us you know we started in 2020 and we didn't you know because of a lot of regulations and and external approvals that we need to go through like we ended up taking us until November of like 2021. And quite honestly, Jason, we didn't know if we were going to sell like I was ready to like be fired and just get a new job. Like I didn't think it was going to happen, you know, we were in the middle of COVID. Uh, and then we got the approval and then we were able to kind of figure finally announce it in internally, right? Like at the last uh, I feel like we were announcing it and the people were like, "Oh, when did this happen?" Like this happened like a year ago, but we're just letting you know now. Oh, man. Yeah, I I I feel all your pain. Uh, you know, it's and that and I love having the having you on the show and just hearing the raw story just to educate founders cuz there's so much hustle porn out there of like, you know, like that you know, helps keep us going like you know, don't quit, don't stop, but like it's not like the rosiest picture. You had a six very successful outcome, but there were so much blood, sweat, and tears to Yeah, yeah. get there. Uh, and it just as long as founders know what they're getting themselves into and know that that's the fight they have to fight. Cuz if you don't, you know, if you weren't juggling all that at once and managing all these personalities to ultimately march it towards the finish line, it's rare that these things just fall into place. If you were to said one wrong thing to your chairman who then accidentally said something to, you know, one of the in you know, choir it could all like blow up. So, it's like that very sensitive you know, communication management which I spend a lot of my time with founders I'm like, "Okay, you can say this to this person, but don't say this to this person until we know that this person it's like the the logistics of managing the flow of communication. But, um I want I want to switch over now to what you're doing today. Uh, it's very relevant to to our audience. Obviously, have your book sharing your journey uh, called The Underdog uh, that anyone can pick up on on Amazon. You also have your venture studio called The Founder School. Uh so, if you can give the audience a little bit about why you started it and what's the what's the offer there? Sure. Uh so, I I sold my company uh Thinkster by a year later I wound up going back to YC uh this time as a visiting partner. I spent about a a year there and and I got to see firsthand how to how to run an accelerator from from this thing the ground up from end to end. Uh I spent from the very best, which always helps. Uh and and I found that I learned a few things predominantly around how much First of all, like how much everything looks the same at the beginning. It doesn't matter if you're building a SaaS company or a submarine company. Everybody has the same intrinsic problem at the very beginning. Um I also learned uh the right way of kind of of coaching and communicating to to young founders in order to get them from point A to point B, how to standardize a lot of like the lessons learned from other founders into very digestible bite-sized advice. And I also learned, quite honestly, that I really enjoy sharing these lessons. Uh you know, something about us founders is like once you go through the process of pain you come up almost get satisfaction out of sharing advice that will reduce that pain for others. It's just really weird. I you know, I think you and I could describe it but we but other people probably can't. Um and so, after I left YC, published a book, a lot of people approached me about giving them advice and being their mentor and and that kind of ultimately led to me standardizing a number of lessons learned into what became the Founder School, which is a 12-week program dedicated to helping diverse tech professionals launch tech startup in about 12 weeks. So, we can work with people that are mostly currently uh employed at their firm, typically engineers, people that want to know how to launch a company successfully, but don't know yet how. So, we give them all the tools, the frameworks, and they kind of and we we really go, you know, headfirst into everything from how to get ideas, how to talk to customers, how to launch a no-code MVP, how to get paid for it, uh to the point where you have a product that's ready to um you know, get into an accelerator. So, we quickly hand them off to an accelerator right after um we're done. Typically, Techstars or YC. Nice. So, it's kind of like a you know, I guess they call it more of an incubator, you know, incubator type Yeah, it's an incubator. Yeah, exactly. We are incubator uh companies into top accelerators or receipt funds. No, but it's great model on getting there very early, adding that extra value, and And is it you said you it's predominantly focused on uh diverse founders? Yeah, diverse technical founders, typically engineers, data scientists, product managers. Currently working at a at a at a series A company or or Google, a lot of those, and uh want to start a company, but don't want to take the leap and start a company or are comfortable at their job set. So, this is probably for them like a safe space to ideate and experiment. And in 12 weeks, the goal is that you have, you know, a real business that's generating real revenue uh with with customers, and then you're ready to you go into an accelerator. We've had a lot So far we've graduated, you know, six companies last year. On average this company went out raising a lot of money bucks each. We had a number of successes. Uh we had one company called Linker Financial. We just raised 3.7 million from Commerce. Uh one called Chat for she raised 3 million dollars from Capital. And just, you know, I'm just you just keep, you know, we're running the flywheel. No, it's a it seems like a good model in terms of feeding it into to other accelerators that you already have the relationships with and you know, creating that that safe space cuz yeah, getting getting someone to leave a very cush comfortable salary to make the leap, especially if that's how they started their career, is with a cush comfortable salary with a certain amount of expenses that they are associated with that. It's hard to kind of take that hit. It's like, all right, you're making 200 something a year, you know, K a year and it's like, about about maybe zero or 50K a year. How's that sound? No. Yeah, yeah, exactly. Yeah. But I wouldn't change I wouldn't change anything that I've done as far as, you know, the ability to create and control is something beautiful about being a founder and probably why not many people do what we do. So, you know, being that you have so much experience working with founders these early early stages, what have you seen in as far as like common mistakes that you see it happen and you just you just can't help but jump out of the seat and want to help someone. Like what are those common mistakes that you see? Um yeah, I think the most common mistake I saw at especially YC is just taking too long to to to to launch and getting a product in front of in front of customers. I think um I think a lot of founders fall uh victim to this whole notion of perfection and wanting to be their first product to be an extension or a representation of themselves. And it's it's hard because, you know, we learn in school and at work that things need to be of a particular standard. That's fine. I think it's fine. We have to unlearn and unwind a lot of these uh best practices that apply to the corporate world that don't apply at all to the startup world. Because the goal of, you know, your first product is not really to start a presentation of yourself. It's really an experiment. And you And people think that the first product is their business. It's not. It's an experiment. That's something that you can go out and learn. You know, get yourself out there, give yourself opportunity to learn. And ultimately you will find a way um to tell you know, I've worked now with a lot a lot of founders. Enough founders to to understand that that is a very common issue. So, you know, at the Founder School we we we force people to kind of launch a very lightweight no-code MVP in in this first, you know, few weeks of the Founder School. Cuz otherwise they just wind up spending the whole batch just kind of regurgitating on ideas and so that's been my like my number one number one That's the number one thing I I've seen you know, all founders have issues with. Yeah, I like that. I appreciate that. I hate perfectionism. Yeah. So, I want to ask a fun question here and I'm you know, I'm not sure what you'll what you'll say, but I always like to ask founders, what's in either in your fundraising experience uh for Arca or for the companies that you help, the pitch deck is always something that's synonymous with fundraising. Is there anything that you did that you felt was particularly unique or that you were extra proud of when it came to building your pitch deck? I think that's a great question. It's a great question. So, I think there's two there's two aspects to that. First of all, I'll say you know, I would say we follow a particular template, which which I'm a big fan of and and I teach that. It's very simplistic. It's all about kind of the simple concept is every slide you have a main point. Uh and you should bring up your strongest point up front, not at the end. If your strongest point is traction, you should bring that up. If it's your team, you should bring that up. It's all about the sickness and delivering very strong points and and whatever the point is should be on the headline. And everything else should, you know, support that main point. Uh because I see a lot of decks just go ramble into like random stories and like, "What's What's the point here?" So, that that's the standard thing I, you know, I I teach at the founder school as well. When we get to fundraising, which is like week 11 or 12. The aspect that I did that I think was very personal to me and I again, you know, that I think the picture's still up there for TechCrunch Disrupt. Uh I think it's still up there on YouTube. Is that I I made it very personal. And I think that was the biggest shift from like my YC demo day which happened in August of 2013 to my uh TechCrunch Disrupt presentation, which happened in September. I made it very personal. So, I brought in pictures of my uh my Tia and my Lola, my aunt, my grandmother. And I was like, "This is the reason why I'm doing this, you know, to better send the money." And it was, right? And that completely that shifted the entire feeling of the the presentation. Like it made it much more personal. Uh and and I think that was the biggest factor behind my me going from raising like zero cash to raising ultimately $3 last week. That's the story I have on that. I appreciate that. Yeah, it's uh I always get a different story and yeah, YC has its templates, but I mean, what did you break of that template out of like the typical pitch deck narrative that everyone follows, like what's your unique story? And I appreciate you sharing that. Of course, man. This has been a great conversation. Appreciate you sharing all your insights, your stories, and getting intimate in terms of the the chaos that you went through to to get to a successful outcome. What's the best way for founders that are listening to to follow you, learn more about you, buy your book? What what would be the best way for them to learn? Uh follow me on LinkedIn. Yes, and then you see all uh the list. Probably not that many on LinkedIn. Uh my book, The Underdog Founder, can be found you can find it on Amazon. Uh and you can learn more about the work I do with the Founder School. Uh just follow me on LinkedIn and and and I answer most uh LinkedIn messages as well. So, we are opening up our applications for a batch coming up in um November. That's all. There you go. If you are an aspiring founder that uh loved the Chris Ye story, then you know, maybe reach out to learn more and uh apply now. Uh well, apply when it's open. But, really appreciate you being on the show, sharing your insights. We'll make sure to include all the links to your book, the your website, and where people can apply. Actually, what is the uh the Founder School website? Uh it is phoenixfounders.com. Got it. Phoenix Founders. That's what it Oh, Phoenix. Nice. I get it. Uh well, appreciate you joining us today and look forward to to getting this out for our for our audience. Thank you, Jason. Appreciate it. See you, brother. Thank you for watching today's episode. As a reminder, I'm your host, Jason Kirby. I have built and sold multiple companies with over 135 million in transactions as either a founder, operator, or investor across multiple industries. I'm currently the managing director and founder of thunder.bc, where we help companies and founders at all stages navigate what capital to raise and who to raise it from, and help improve companies' odds of raising capital. If you need help, reach out to us at help.under.vc. If you liked today's show, please share with your friends, give us a like or a comment down below. And as a reminder, this show is published weekly. To get notified of new episodes and our newsletter, be sure to go to our website at join.under.vc. 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