20VC Unscripted: Pricing is Crazy, Pre-Emptive Rounds are Normal, Pricing at 200x Revenue Multiple is Common, There is More Cash Than Ever. What Happens Next; Market Analysis with Ryan Denehy, Founder and CEO @ Electric

The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch

The Twenty Minute VC

Finance, Venturecapital, Tech News, News, Siliconvalley, Technology, Investing, Startups, Business

4.4 • 637 Ratings

🗓️ 4 November 2021

⏱️ 35 minutes

🔗️ Recording | iTunes | RSS

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Summary

Ryan Denehy is the Founder & CEO @ Electric, the company that provides a modern IT solution that's simplified. To date, Ryan has raised over $188M for the company from the likes of GGV, Bessemer, Slack Fund, and 01 Advisors to name a few. As for Ryan, he is a 3x entrepreneur with his first company being acquired by USA TODAY Sports and his second company, Swarm Mobile being acquired by Groupon in 2014.

In Today’s Episode with Ryan Denehy You Will Learn:

1.) How Ryan made his way into the world of startups with his first startup being acquired when he was still in college? How have experiences raising $180M with Electric, impacted how he thinks about the venture market today?

2.) Is Ryan concerned by the lack of due diligence investors are doing today? How has the DD process changed over the years? What materials should founders provide to investors? How should founders reference check investors? What do many founders do wrong here?

3.) Should founders always take the most money at the highest price? When thinking about price, what do you founders have to think through? Why are some of the prices we are seeing today so crazy? How can founders outcome scenario plan to come to the best price option? When are founders and investors misaligned when it comes to price?

4.) What does Ryan mean when he says, "sales and product-market fit are more closely related than people think"? How does Ryan advise founders on when to really raise big? Does Ryan believe in the notion of "skipping a round"? Does this ever happen? Does Ryan ever believe the "this will be our last round before we breakeven" statement?

Transcript

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0:00.0	So in 2,800 recordings of 20 BC, this show today is a first. This is the first time I've ever
0:05.3	done a show where we didn't even start with the schedule of what we were going to discuss in this
0:09.0	episode. It all started with two friends talking about the craziness of the market, pricing,
0:13.5	preemptive rounds, current rounds, and then we thought this would be a super interesting episode
0:17.3	to do. And so with that, I'm thrilled to welcome a dear friend Ryan Danahey. Ryan is the founder of Electric. With Electric, Ryan has raised over $188 million
0:24.5	for the company from the likes of GGV, Bessemer, Slack Fund, and 01 advisors, to name a few. As for
0:30.8	Ryan, he's a three-x entrepreneur with his first company being acquired by USA Today Sports,
0:35.3	and his second company, Swarm Mobile, being acquired by Group
0:38.2	1 in 2014.
0:39.7	But before we dive into the show state, did you know that more than 80% of US public stock
0:43.9	is owned by just 10% of Americans?
0:46.1	This divide is even greater in the private markets.
0:48.6	Carter makes it as easy to issue equity to your employees as it is to issue payroll, and
0:53.2	for employees, as easy to accept it
0:55.2	too more than 16,000 companies issue equity to their employees through Carter whether you're
1:00.2	just getting started or getting ready to go public the team at Carter can help check them out
1:04.5	at Carter.com and then another incredible product you have to introduce is Secureframe
1:09.4	Secureframe helps companies get enterprise ready
1:11.9	by streamlining SOC2 and ISO-271 compliance. Secureframe allows companies to get compliant within
1:18.6	weeks rather than the painful months that is today. Join companies like Stream, Hussura,
1:23.8	Benapos, and unlock more sales with Secureframe, and 20 VC listeners get 10% off at
1:28.9	Secureframe.com forward slash 20VC.
	...

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