How to Make VCs Ape Into Your Project

Transcript

so uh we're here to talk about how to get investors to ape into your project so if you're already an investor you can leave the room okay going once all right and if you've got any friends you want to learn how to fundraise tell them to get in here now there's only a few seats left fomo that's another lesson uh my friend here richard muirhead richard hi everybody thanks evan and people call me seven but uh real name stephen waterhouse hey this slide how does it work okay cool so uh richard looked at this definition of vaping in aping in is a term that's used a lot on the space and it's sort of irreverent um but it turns out it has an urban dictionary meaning yeah and look

you can read this you can read it later but i think the key takeaway from this is that despite the bad reputation aping might sometimes have it's actually the pinnacle of investing practices what it means is that your level of synthesis conviction around the investment you're making is so high that you go in and you hold forever with diamond hands the greatest force known to humankind now i mean joking aside we're actually not going to hold forever but that's for a long time at least he sees it feels relative to the crypto space in the vc hold period is pretty long we're actually looking at a kind of you know 10-year horizon so it's that's extremely long by you know uh crypto oh

it's all of crypto basically and but the other important thing about it is that um it's all of the things that happen before you encounter often you know a team uh with a great idea um a great market a great set of business models all of those things that have happened before that lead you to feel that this is the the set of people you want to partner with yeah it's like there's a lot of times you've got really great teams really great ideas but people just have no idea how to fundraise it's a question i get a lot so this my [ __ ] thing doesn't work okay so a little bit about who we are and then we're gonna move quickly

through this so richard go ahead yeah so uh apparently we actually met at university it's actually true both doing engineering him much more seriously than me he did help me out at least once on some maths um and then after that uh i built a telecom software company um back in the day when you know we were transitioning to data networks we had an ipo which was which was fun that's now owned by oracle uh then i helped um accel partners set up uh in europe 20 years ago now as an entrepreneur actually who knows what an eir is it's a kind of vc term no freaking idea so it an eir stands for entrepreneur in residence

which is a kind of fancy term for being given a blank sheet of paper and said go build a billion dollar company um that got me some insight into venture capital because axel were pretty storied already and they were building up a european operation i came out of that and built something that was very early in the devops and cloud space on the infrastructure side which we sold to bmc software in 2009 um emerged out of that and started investing jumped into one of my investments and ran out for a year that sold that to ca technologies but really since 2012 and in particular from 2013 when um in the spring of that year seven told me i should take another look at bitcoin

got drawn into the whole bitcoin blockchain web3 space yeah we've got something we have we really have to riff we'll just keep going uh i've done a whole bunch of stuff i'm from the uk now live in lisbon and i got into crypto in 2013 uh build a fund build a company and i work with him as well um going to move a little faster so we're looking for you right so a lot of people are like oh i don't i haven't done this i haven't done that like how am i going to raise money what's going on like why it doesn't really matter um you could be kind of almost from any walk of life at this point in crypto if you got the right team you got the right

idea you probably could make it i'm not saying you're definitely going to make it but you might make it um so experience but experience is really helpful like if you've been in this space for a little while if you started like contributing to things like getting involved in things these are definitely things we look at but the one of the biggest things we look for and it's it's less location nowadays especially after covert is strong teams we're looking for teams that gel themes that look like they're going to stay together like you know have good dynamics there's like you know kind of all the key components we're looking for there um so these are some of the things that we're really looking for anything to demonstrate good teamwork i'm going to ask do you want me to add more to this or should we go to the next slide

actually can't hear what you're saying okay good it's uh nothing to add other than that cannot emphasize more you get a very you get a feeling for meeting the people i mean even over zoom but especially in person the individuals how they complement each other and how you know you might be able to work with them over time and that's that's pretty much it i think the thing to remember is that like our job is to look at deals all day long we look at hundreds of deals a year so we can kind of smell it when it doesn't feel right when the team doesn't feel right if there's something wrong we're gonna we're gonna like you know yeah this doesn't feel right and then you'll get the message like oh yeah we're passing for blah blah blah reason but it's like usually like something's

wrong right so if you if you think there's something wrong with your team there probably is something wrong with team fix it before you try and do this stuff because once you get engaged it becomes a whole thing um yeah the biggest part of this and this is redone a lot you know like ted talks about this stuff but telling stories right and i i'm personally less interested in what's the unmet need that your new thing is going to solve i'm really interested in what's your vision of the future does that vision of the future match my vision in the future because i you know obviously have like an idea where i think things are going it may not it may be something brand new in which case we'll be like oh that's cool interesting surprise and how is what you're gonna do be gonna come crucial

and intrinsic to that future right so you think about like you know the metaverse doesn't have some like unmet need i'm not sitting there going god i really wish i had like a new outfit for my me bit it's like but maybe that is maybe that is the future maybe like fashion for me bits and other things is going to be a huge thing one day i mean when open c started people weren't sitting around going god i really watched someone spend my like money on nfts but now it's like a really big deal right yeah absolutely and and so one way i think about this is definitely that the the founders that seem most compelling and powerful literally seem like they have had that glimpse you know into the future they have come back from the future and describing how it's going to be and then

telling a story about that that is totally concrete not abstract not talking about technologies coming together and features and bells and whistles whistles and the rest of it but actually describing how it being used but it's more than that as well it's telling the story of how you came into that insight and came together as a team and then came into building that company that story is crucial as well um how do you find investors you go out right well also you stay in so it's like go out and stay and it's like like boris this thing right um so it's it's really changed even in the last year or two um but this was this was a sort of a trend i feel like covert sort of accelerated a lot of

things that we were already doing in in this space um you're not gonna find people if you don't engage you're not you're just like it's not gonna like someone's gonna like oh hey you know venture capital guys sitting there investors sitting there going trying to find you you've got to find them and then the flywheel starts another really important thing i think is is being part of the ecosystem and to the extent that you can invest even as a small amount get involved contribute sometimes sort of sweat equity there's so many ways to do this stuff now um if you're a developer like really big you know kind of active github getting involved in get coin projects these things all start creating signals and then connect you with people that then you know lead to another connections and so on but

i i also like one thing it's not on the slide but if you're thinking you need someone else to help you raise money you're doing it wrong you're not going to make it so you are going to be as the key people you're going to be fundraising forever right and well i mean until you stop doing what you're doing in the sense that you're always selling you're always selling your vision you're selling a company if you don't know how to do that you better learn how to do that or find someone in your team who's going to do that hiring someone else to do that is like usually i just walk away when i see that deal i'm like yeah this person doesn't know how to fundraise i don't want to fundraise with this other person who's taking a commission like they need to figure that out so i

think that's a strong thing to figure to figure through right yeah absolutely underline that if there's some third party involved or you know god forbid like a bank or something trying to help fundraise yeah is that a that's a full letter word here of course bank um but you know then we're not even going to look at it most most likely but the other thing to underline here is and this does not need kind of explaining probably to individuals here that how important community is and if you generate good community not just broadly but specifically in your space and people start saying great things about you that comes back that comes back to you know the investors and there's no more powerful way to understand that something is getting traction and popularity and it

could well turn out to be the next hot thing than hearing it from other people um so like once you've got some investors you're gonna you've got to keep engaged right it's it's not okay to sort of send an email out once or so you know talk to somebody once and think that they're suddenly gonna start thinking about you remember investors are overwhelmed by deal flow they just don't even know how to like process things it's like there's like special kinds of software being written for this stuff so this is like a general theory of um of just sort of how you engage with new people so you have to tell them stories you could like all these things but you also got to like um tell people something interesting each time so you might be like hey i've got

an update for you oh and by the way did you see this piece of news that's relevant to our space or something interesting that you found out you could be constantly gathering this kind of you know sort of like tip bits and so on and and then this is a really simple trick is it is that do so tell people you're gonna do something then do it and then tell them you've done it and then keep doing that and after a while they're like oh my god this person's consistent they actually do what they say and it's a very simple technique but it sends a lot of signal to investors and you know hopefully you're not tricking us but you know the idea is that it actually works out yeah yeah absolutely i mean there's a thing i think it's fred wilson talked about kind of you know having

enough dots to kind of start to see the pattern on the line and so i mean that's really what investors are looking for uh rather than just have to see the one point in time the snapshot and really just project for it from there so if you can help doing that by repeatedly come back with the update it's great but the the heart of this is don't actually pitch in a thing just be telling the story and sharing the updates and then suddenly have that story all going to make sense and unfold as certain we're just saying that's what leads into this slide is that is that um it's it's kind of like you should succeed whether or not you raise money it's kind of like the thinking process it sounds a bit like new age but but it's about like the idea is that

your your milestone is not to raise money your milestone is is way beyond that fundraising is just this little step on the way that's sort of annoying and irrelevant and we'll get we'll get done but if you can convince people that you're going to do it anyway the trainer is leaving the station whether you get on it or not then people will generally get in and create this stuff which is a sort of you know fomo thing um and so another thing here is um it's kind of like a strategy for how you select investors it's not there's not a slide on this but most people go out and they're like i've got to find you know huge fun like this you know marquee name that when i do a press release everyone will look at me because i got whoever in right another way to think about this is

instead of trying to find them and convince them you convince the smaller investors you can miss the angels people who are really influential people who talk to them and if you do enough of that and you get enough of those people in your deal the big guys will come to you anyway they'll actually find you they'll like come like knocking on the door because they'll have heard about the deal right yeah so it's about creating that inevitability you know you know right up front through your own confidence to your own attitude um and we already said it like the assumption is here you know your idea is incredible your the market is gonna be or is already enormous you know the way you're gonna put together your token design and mechanics is spot on team it's all falling into place and that you want to have the feeling that

and you want to have that feeling that you know exactly where you're going you're going to be shooting right through this first milestone of fundraising all the way through to your your vision and the reason it's so important in particular to create fomo is that despite what they might tell you investors rarely are able to have sufficient confidence around something you know just that nobody else is looking at and thinking i want to go for that generally speaking to the point that seven raised there are 200 new opportunities per month and at any point in time you're going to have a dozen that you're trying to work out either you're going to be able to you know work with them or in fact selecting the one to focus on so having that clarity of the ones that really feel this one is inevitable and is slipping out of your grasp is is key

all right that's that's pretty much the tutorial um we're available for questions just a kind of a little bit of kind of what we've done i'm not going to go through any of these actually or all of these but this is some of the deals that fabric ventures have done in the last few years um little pitch on the front we've just raised uh can we talk about this yeah okay we just raised a fund um backed by european investment fund um and we've got plenty of money to invest and we're looking forward to meeting you and uh this is a bit about the team there's a couple people in the audience two of them right there um at the front hands up let's come find these two and and pitch in your deal and there's some more people kicking around somewhere or they better be uh i see a few more people

from fabric um team is based like kind of all over the place we've got a couple people in london um and luxembourg uh two of us in lisbon berlin and france are like very like european focused um ask is anything i guess like who's got a question who wants to learn how to do this stuff is this real because it just popped up and it says 12 minutes to go he just wants us to wrap it up so faster give them some time back we'll get a freebie for that right nfc down here hey guys uh thank you for a great

presentation you both look great on the on the stage thank you very much thank you my question actually about talking race and it is you mentioned like uh you better speak first to the smaller investors like angels and then you get a bigger fund so what's the best strategy in your way fundraising for a token like do you find first the lead investor and then force all your efforts on finding a lead investor or you better talk to high-risk angels and smaller so my personal opinion having sort of done this a few different ways and then also seeing deals come to us is it actually depends on the stage so in the in the

first stage i think that many strategies can work but one strategy that i prefer is to engage with people who believe in it like angel investors people who might even be involved um you know on some other level people who are like in a lot of the projects we do people providing liquidity or partners and so on and then get them involved because those conversations are quick and easy and they don't have to go through a process they're just like hey yes here's the money let's go and then as you want to build and finish that round out then sure then that conversation will actually probably most likely go directly to some of the funds like us because we'll hear about it we're like oh hey we'll come find you um but even if it doesn't then you have um a stronger basis to have that

conversation with funds that just like we you know we have more process we have like kind of like things to do we got more it's just like kind of like it takes longer for us to sometimes make decisions than you know like some people who might meet here right um and then the next phase so the next round i think it's actually healthy to have a lead because what happens then is it's usually someone who's not been in the round before and then they're coming in and kind of like validating the round if you like often pricing the round in a different way um if it's just insiders in the first round going into into the next round it can be okay but it just sort of depends i think second stage and the only thing i'd add to that is that actually a pretty cool trick is not

to be fundraising i mean if you want to secure your lead a real lead is going to want to try and get in early so if you're saying we're fundraising we're talking to a whole bunch of people then they you know then they're gonna go well i'm late and there's a problem that's gonna be competitive or whatever but you wanna you wanna find that outfit probably person you wanna partner with and be not fundraising and then put together the round together with them next question no question i would say thank you very much and maybe they can come to you to talk uh after the talk because we are really running behind schedule and uh even behind the main stage so we really have to go on all right we're gonna we're gonna wrap this up i guess we we will actually

be canon near the little speaker thing next door and um i got some swag for awkward in case anyone wants to come and hang out and pitch their deal too all cool thank you thank you very much [Applause]