Are you ready to sell, sell, sell?! The honest truth is no matter if you decide to bootstrap or raise venture capital money, one thing is certain and that is that you will NEED to sell. You will either be selling your idea to many potential VC investors or selling your product to the public. Either way, get ready to put your sales hat on! I have sold my product through bootstrapping and I have raised money through investors. Fortunately, I LOVE to sell! I think both are just as interesting and just as fun. So, my last piece of advice is this: make sure you learn how to sell because whether you like it or not you have been in sales your whole life, selling yourself to the world. Good luck and please reach out if I can help in any way!
Founders are often faced with the nagging question of whether Fundraising or Bootstrapping is the best choice for them. What is better, having access to capital or maintaining full control over your vision and profits? What is preferred, to have the seasoned oversight of an experienced investor, or to plow forward with a disruptive and pioneering ‘can do’ attitude? Of course, every situation is different, but what standards can be used to help a founder decide? As a part of this series called “Venture Capital vs. Bootstrapping: How To Determine If Fundraising Or Bootstrapping Is The Right Choice For Your Startup”, I had the pleasure of interviewing Jon Ebner.
Jon Ebner is the CEO and co-founder of HOON. He is also a mentor at First Round Capital, founder of BTWN and president of JEbner Consulting. Jon is a loving husband, father, boxer, meditator, author, and self-proclaimed lunch enthusiast.
Thank you so much for doing this with us! Before we dive in, our readers would love to learn a bit more about you. Can you tell us a story about what brought you to this specific career path?
Thank you so much for having me! It is an absolute pleasure to be here! Yes, to jump right in, my father who was an entrepreneur, died when I was 25 years old. As a result, I needed to take over his business as an apple computer reseller. This business supported our family my whole life. Needless to say, I was pushed into being a business owner at a young age.
Can you share a story with us about the most humorous mistake you made when you were first starting? What lesson or takeaway did you learn from that?
Absolutely! I would say not having a lawyer look at one of my operating agreements. I was very close to signing a document that would have put me in a very precarious position. I learned shortly after how important it is to have your lawyer look over all legal documents.
You are a successful business leader. Which three character traits do you think were most instrumental to your success? Can you please share a story or example for each?
Self-discipline, Positivity, and Grit.
When it comes to sales, self-discipline is key. There were times where I would tell myself that I couldn’t leave my seat in the office until I booked a meeting or closed a deal. I would be hungry or have to use the bathroom and I would not leave until I closed that deal. That kind of mindset has helped me to outperform others many times over the years.
Positivity has also always been extremely important to my success. It is very easy to become discouraged in business or even in life for that matter. Staying positive is instrumental to being a leader. This allows you to lift the spirits of those around you and stay focused. There was a time when my team had a challenging goal to achieve 500,000 dollars a month in sales. The task was daunting, but as a leader I needed to stay positive and find a way to make it fun. I created prizes for each team member to motivate them to achieve their personal goal. Every day I would show up with enthusiasm and a positive attitude and this was contagious. At the end of that month, we were all exhausted, but we achieved our goal!
Finally, and most importantly is grit. Building a business and team results in many obstacles and challenges coming your way and without grit, I would never have survived. One story that comes to mind is about one of my top sales guys named Jamey. Jamey was riding his bike on the weekend and was hit by a truck! I went to visit him in the hospital and even with broken ribs and bruises all over, this guy was still reaching out to clients! Talk about grit! Not even a truck could stop this guy from selling. As his boss and friend, I advised that he rest and take it easy and allow me to help, but he was too determined to do right by his clients. Jamey is the definition of grit.
Are you able to identify a “tipping point” in your career when you started to see success? Did you start doing anything different? Are there takeaways or lessons that others can learn from that?
Yes, I think the tipping point was when I began my career in the startup world in New York City. I found a company that I wanted to work for called Cater2.me. I applied and interviewed, but someone else ended up getting the job. While I was discouraged at first, I decided to become creative in showing this company why they NEEDED to hire me. I walked in cold to their building with a package of cupcakes and was granted an impromptu interview with the founder. He would go on to hire me and thus began my journey in the startup world. The lesson here is that if you really want something, stop at nothing to go get it, even when someone tells you “no.”
None of us are able to achieve success without some help along the way. Is there a particular person or mentor to whom you are grateful who helped get you to where you are? Can you share a story about that?
I agree wholeheartedly. The first person that comes to mind is my father. He was not only an incredible businessman, but one of the most amazing people I have ever known. In my twenties, when I was in between jobs, he had me work for him for minimum wage. He would have me do all of his grunt work (invoicing, bank recs, and accounts receivable) and it was miserable. I was getting paid next to nothing and doing work that was boring and awful. Little did I know that he was training me to understand every aspect of running a business, including the less glamorous roles. After this experience, we jumped into the more exciting parts of business like sales and building relationships. Without these lessons from my father, I never would have understood the importance of doing the tedious tasks that make a business successful.
You have been blessed with great success in a career path that many have attempted, but eventually gave up on. Do you have any words of advice for others who may want to embark on this career path but are afraid of the prospect of failure?
Absolutely! First off, this is not for everyone and that is ok. That being said, if this is something you want to pursue, then go for it full force! Know that you will have failures and challenges and that is part of the journey. The greatest antidote to fear is action, so when those thoughts of fear creep in, pick up the phone, start writing your business plan, any action that will move you forward in your pursuit.
Ok, thank you for that. Let’s now jump to the main part of our discussion. Can you share a story with us about your most successful Angel or VC investment? Or an investment that you are most proud of? What was its lesson?
When starting to raise money through Wefunder.com we realized early on that it is a true grind. Non-accredited investors can invest for as little at 100 dollars. When you are trying to raise hundreds of thousands of dollars you may be looking at bringing on hundreds of investors. At the beginning, when we had no technology and were simply selling ourselves and our idea I came across an old founder I used to work for. He asked for a pitch deck and competitors and a whole slew of other details. We chatted back and forth through email, jumped on phone calls and the process went on for weeks! I answered all of his questions one by one over time until he finally had no more questions. At this point I closed for our biggest investment to date. The lesson here is a sales lesson: overcome objection after objection and when they cease, ask for the close!
Can you share a story of an Angel or VC funding failure of yours? What was its lesson?
Definitely! Unfortunately, it is much easier to remember the failures. I had spent a lot of time speaking to a potential investor in our space and felt he would be the perfect person to write a large check and get us moving forward. We chatted for weeks about the market and places to improve our product. I was waiting for the perfect time to ask for an investment and when I finally did, it was a flat out “NO.” It was crushing. That being said, I felt the pain for a day or two and then got right back on the horse. As I mentioned earlier, the failures are guaranteed to come, but just remember that every “no,” is one step closer to that “YES!”
Is there a company that you turned down, but now regret? Can you share the story? What lesson did you learn from that story?
Yes, Lyft. Before taking my job at Platterz as one of the first hires in the US, I turned down a job with Lyft. Seeing where Lyft is today and where their stock price is makes it a tough pill to swallow. That being said, in hindsight, I would not have done anything differently. The lesson I learned here is that sometimes you have to turn down great opportunities now, for even better opportunities later.
Super. Here is the main question of this interview. Let’s imagine that a young founder comes to you and asks your advice about whether Venture Capital or Bootstrapping is best for them? What would you advise them? Can you kindly share “5 things a founder should look at to determine if fundraising or bootstrapping is the right choice”? If you can, please share a story or example for each.
Personally, I would push everyone toward bootstrapping first. I have worked for and started companies that were both bootstrapped and required investment. When you bootstrap a company you have more control and more integrity. However, many companies require Venture Capital and I understand that. Here are 5 things to look for to determine if fundraising is the right choice:
1. Do you absolutely NEED the money? With all of the VC craze these days, we think we need to raise capital, but what if you can actually sell your product early on and self-sustain? When we started BTWN, there was no need for VC money as the startup cost was under 1000 dollars. We simply put together a website and program and began selling. We were able to operate in our timeline because we did not need to answer to investors.
2. How much money do you NEED to get started and where will this money go? Many times we get caught up in all the things we “think” we need money for (marketing, hiring, software), but how much do you really need? When raising money for HOON, it was simple. We needed 100,000 dollars to fund our technology. In our minds, once our tech was built, we could begin to sell and go back to treating the company like it was bootstrapped.
3. WHO will you be getting into business with? If you ask me, the most important thing to pay attention to when starting a business and considering raising capital is WHO will you be doing business with. Having the wrong investor(s) can destroy a company. When visions and missions are not aligned it is a recipe for disaster. At a company I worked at, our series A investors were the perfect fit and accelerated the company. Our series B investors, however, in my opinion were an awful fit and thus began the downward spiral.
4. Will you be building a hyper-growth company? If this is the case, many rounds of VC funding may be right for you. Many companies out there today have no initial monetization strategy and are simply looking to acquire users (think Facebook, Instagram, Snapchat). When working with an Artificial Intelligence startup, acquiring new users was essential and they required multiple rounds of funding. This company was still smart about where it spent money, but it definitely required A LOT of VC cash.
5. Finally, are you ready to sell, sell, sell?! The honest truth is no matter if you decide to bootstrap or raise venture capital money, one thing is certain and that is that you will NEED to sell. You will either be selling your idea to many potential VC investors or selling your product to the public. Either way, get ready to put your sales hat on! I have sold my product through bootstrapping and I have raised money through investors. Fortunately, I LOVE to sell! I think both are just as interesting and just as fun. So, my last piece of advice is this: make sure you learn how to sell because whether you like it or not you have been in sales your whole life, selling yourself to the world. Good luck and please reach out if I can help in any way!
You are a person of enormous influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
Love this question! At HOON, we are building software to even the playing field for all. We want to demystify the challenge of starting your own business and provide the tools to allow anyone in the world to simply and cleanly start or enhance their company.
We are very blessed that a lot of amazing founders and social impact organizations read this column. Is there a person in the world with whom you’d like to have a private breakfast or lunch, and why? He or she might just see this. 🙂
The first person that comes to mind is Mark Cuban. He is a brilliant business mind and picking his brain on business and life over a meal would be fascinating.
How can our readers further follow your work online?
Thank you so much for this. This was very inspirational, and we wish you only continued success and good health!