Zyper helps brands connect with their superfans to build community. They work with large companies like Kellogg's and Nike to identify and engage with the top 1% of fans for co-creation or brand ambassadorship.

How difficult is it to raise pre-Y Combinator funding?

Raising pre-YC funding can be very difficult. Iba Masood mentioned that raising the first $100k was a challenging process, even after securing a $10k grant from MIT.

How long does a Series A fundraising process typically take?

The duration of a Series A process can vary significantly. Amber Atherton's process from first meeting to term sheet was 9 days, though the closing took about 60 days. Iba Masood's process took around 60 days for fundraising and longer for legal completion.

What is an investment memo, and why is it important?

An investment memo is a document that VCs use to evaluate potential investments. For fundraising, founders can proactively write their own investment memo to present to VCs, essentially doing the VC's job for them by outlining why the company is a good investment, the problem it solves, market size, and potential risks.

What are the key differences between raising a Seed round and a Series A round?

While the video focuses on Series A, the speakers highlight that the Series A process can be more structured, especially with programs like YC's Series A batch. Key differences lie in the stage of the company, the amount raised, and the investor expectations regarding traction and team maturity. The emphasis on finding the right partner and process remains critical for both.

What are important signals to look for in potential VC partners?

Look for VCs who understand your specific industry, ask insightful questions, show genuine enthusiasm for your product, and demonstrate experience in category creation. It's also crucial if they have a similar long-term vision for the company and exhibit strong people skills.

How can founders create a sense of urgency during fundraising?

Founders should be honest about their process and avoid fabricating offers or urgency. True urgency comes from having a hot deal with great product and traction. While managing a pipeline and seeking clear yes/no answers is important, creating artificial pressure can be counterproductive.

What are common mistakes founders make during fundraising?

Founders should avoid optimizing solely for valuation, as it can misalign incentives. They should also be wary of pressure tactics from VCs and stay true to themselves. Over-optimizing for brand name recognition without understanding the VC's expertise in the space is another pitfall.

How should founders approach the 'how big can this be?' question?

Founders need to balance conviction with realistic optimism. While it's important to believe in the company's potential, avoid making outlandish claims. Authenticity, a clear vision for growth, and the ability to convince investors you're backing the right horse are key.

What are the biggest shifts after raising a Series A?

Post-Series A, a major shift is prioritizing company culture and values, attracting and retaining talent, and potentially moving headquarters. Building a strong founding and leadership team becomes paramount as the company scales.

What advice is given for founders raising their first round?

Focus intensely on the partner you will be working with, as it's a long-term relationship akin to a marriage. Have a structured process, stay organized, and cultivate confidence and resilience, as fundraising is challenging. Persevere, as someone will eventually say yes.

Key Moments

Amber Atherton of Zyper and Iba Masood of TARA on Raising a Series A as a Female Founder

Y Combinator

Science & Technology3 min read63 min video

Dec 18, 2019|7,173 views|63|15

YC Y Combinator

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Key Moments

TL;DR

Female founders share Series A fundraising insights: process, partner selection, scaling teams, and founder psychology.

Key Insights

Series A fundraising involves a structured, intense process, often taking around two months, with a focus on building a strong pipeline and investor relationships.

Selecting the 'right' investment partner is crucial, emphasizing shared values, market understanding, and long-term alignment over solely maximizing valuation.

Founders need to be authentic and true to themselves, avoiding pressure to adopt 'male' characteristics and focusing on product-market fit and team strength.

Post-Series A, prioritizing company culture, values, and building a strong founding/leadership team becomes paramount for sustainable growth.

Developing a clear vision for company culture and defining measurable OKRs (Objectives and Key Results) are essential for guiding team performance and alignment.

Effective board meeting management requires preparation, clear communication, and leveraging board members' expertise for strategic decision-making.

SEED FUNDRAISING AND COMPANY FOUNDATIONS

Amber Atherton of Zyper and Iba Masood of TARA share their early fundraising journeys, highlighting initial seed rounds and key pivots. Masood's TARA evolved from a careers platform for graduates, initially raising $200k post-YC, before pivoting to its current product management solution. Atherton's Zyper, focused on connecting brands with superfans, also successfully navigated seed funding before their Series A. Both founders emphasize the difficulty of early fundraising and how their initial research and market understanding informed their pivots and subsequent successes.

THE SERIES A FUNDRAISING PROCESS

The Series A process, particularly within structures like Y Combinator's program, is described as informal yet intense, typically spanning about two months. Key strategies include meticulously mapping out potential investors, preparing a detailed investment memo that anticipates investor questions, and maintaining a structured approach to managing the pipeline. Founders stressed the importance of crystallizing their pitch, clearly defining the problem they solve, market size, and potential risks, effectively doing the investor's job for them.

PARTNER SELECTION OVER VALUATION

A significant theme is the prioritization of selecting the right investment partner over maximizing valuation. Both founders emphasized that Series A is the start of a long-term partnership, akin to a marriage. Founders should meticulously vet potential partners, looking for individuals who deeply understand their market, share their vision, and align with their company's values. Tactics like aggressive offers or blank term sheets are seen as red flags, indicating a focus on deal-making rather than genuine partnership.

AUTHENTICITY AND NAVIGATING GENDER DYNAMICS

The discussion highlighted the unique challenges female founders may face, including pressure to conform to certain 'male' archetypes or communication styles. Both Atherton and Masood advocated for authenticity, encouraging founders to be themselves and focus on their product's traction and team. While acknowledging progress in diversity, they noted the importance of founders being evaluated on merit and business fundamentals, rather than assumptions about gender or background.

POST-SERIES A STRATEGY: CULTURE AND TEAM BUILDING

After securing Series A funding, the focus shifts significantly to building a strong company culture and assembling a high-caliber founding and leadership team. Both founders stressed the importance of defining core values and intentionally recruiting individuals who align with them. They also shared insights on hiring early-stage talent versus experienced executives, emphasizing the need for individuals who understand the 'hustle' and are willing to grow with the company, even when facing offers from larger corporations.

OPERATIONALIZING GROWTH: OKRS AND BOARD MANAGEMENT

Implementing clear Objectives and Key Results (OKRs) and effectively managing board meetings are critical post-Series A. Founders advised setting realistic, measurable OKRs with strong team buy-in. Productive board meetings, typically held quarterly or bi-annually, require thorough preparation, clear communication, and leveraging board members for strategic insights. Founders suggested using existing all-hands updates to streamline board deck preparation and focusing board discussions on enabling key decisions and strategic direction.

Mentioned in This Episode

●Software & Apps

●Companies

●Organizations

●People Referenced

Common Questions

Tara AI is a company building an end-to-end solution for product management. They help product and engineering managers spec out products, gain insights into their development lifecycle, and monitor progress within software development.

Topics

Technology & Innovation Business & Entrepreneurship Team-building Startup Growth Venture Capital Founder Psychology Series A

Mentioned in this video

companyAmazon

A large company from which engineers may have received offers, influencing hiring decisions for startups.

personAmber Atherton

Co-founder of Zyper, a company that helps brands connect with their superfans to build community.

companyKellogg's

A Fortune 500 company mentioned as a client of Zyper.

organizationMIT

Iba's company received a $10k grant from MIT for research into GitHub repositories.

personDavid Keith

Lead engineer at Tara, recruited for the early engineering team.

companyTara AI

A company building an end-to-end solution for product management, helping product and engineering managers spec products, gain insights into their development lifecycle, and monitor progress.

companyZyper

A company that helps brands connect with their superfans to build community, working with Fortune 500 companies like Kellogg's and Nike.

companyNike

A Fortune 500 company mentioned as a client of Zyper.

companyCrew Capital

The current name of Aspect Ventures, which invested in Zyper.

companyAtlassian

Company from which Tara recruited early software engineers.

companyGitHub

Iba's early research involved analyzing GitHub repositories and programmer commits to identify patterns and top programmers.

companyNest

Company from which Tara recruited early software engineers.

companyPayPal

A large company from which engineers may have received offers, influencing hiring decisions for startups.

companyGoogle

Company from which Tara recruited early software engineers.

personIba Masood

Co-founder and CEO of Tara, a company building an end-to-end solution for product management.

companyY Combinator

A startup accelerator program that both Iba and Amber went through. Amber applied twice before getting accepted.

toolJira

Tara integrates with Jira as part of its product management solution, connecting specs to issue tracking.

companyAspect Ventures

A boutique fund that invested in Zyper, now known as Crew Capital.

personDavid Goggins

Mentioned as an inspiration for developing a winning mentality during fundraising.

companyApple

Company from which Tara recruited early software engineers.

companySequoia

Mentioned for their post on effectively running board meetings.

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Amber Atherton of Zyper and Iba Masood of TARA on Raising a Series A as a Female Founder

Key Insights

SEED FUNDRAISING AND COMPANY FOUNDATIONS

THE SERIES A FUNDRAISING PROCESS

PARTNER SELECTION OVER VALUATION

AUTHENTICITY AND NAVIGATING GENDER DYNAMICS

POST-SERIES A STRATEGY: CULTURE AND TEAM BUILDING

OPERATIONALIZING GROWTH: OKRS AND BOARD MANAGEMENT

Mentioned in This Episode

Common Questions

Topics

Mentioned in this video

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