- Platform: meet
- Source: Read.ai 01J6A28B0RAHW6VZ31A51BCP1M (via Ben Ornstein’s account, imported 2026-08-06)
Transcript
Seb Haugeto: Ben, it’s me. I’m sorry about that. How are you? Ben Ornstein: Oh, you’re good. No problem. Nice to meet you, Seb. How are you doing? Seb Haugeto: I’m good as well. It’s been a, or we’re about to end a pretty good month in a company. So I’m happy. Ben Ornstein: Congratulations. Excited to hear that. Seb Haugeto: Thank you. Ben Ornstein: Awesome. Well, yeah, no, I’m, I’m really pumped to learn more about deal flow. And I mean, I just checked out the website. It looks awesome. I love the branding, clean branding. Seb Haugeto: Thank you. Appreciate it. Ben Ornstein: Yeah, of course. So what, Do you want me to give like a brief introduction of, you know, kind of what this is and what we’re doing here? Seb Haugeto: Yeah, that’d be good. And maybe since we haven’t met each other, we could just do a quick intro as well. And then I’m more than happy to just answer your questions and then go through your process. Ben Ornstein: Amazing that sounds great awesome well I guess I’ll introduce myself so I’m ben grew up in new york I have worked at banking in banking like morgan stanley I work for an early stage startup that pivoted a couple times and went through. You know, everything that can kill a startup, I probably saw in those three and a half years. The company’s still around, but I’m not actively in the day to day. And they’re looking to, you know, potentially have some sort of small exit, which, which would be nice. Seb Haugeto: But exactly. Ben Ornstein: And through that company, I met Hawk, who I know, you know, from launch house, I believe. Seb Haugeto: Yeah, correct. I was there for a month and a half in Q1 of 22. So I guess one of the last batches they ran professionally. Ben Ornstein: Really cool. Yeah, no, Hauk only had great things to say about you. And he, I met Hauk through that startup, because I actually interviewed him on a podcast that I was hosting. And we created a relationship there. I reached out to him and long story short, we’re working together on this, on a couple other things. And I’ll stop there. Seb Haugeto: Well, I’m very impressed and I’m very happy for you and Hoke on the success you’ve had with the newsletter. It seems to be sort of one of the rising newsletters in the tech world. And I think it’s very cool what you guys have been able to achieve. So congrats on that. Ben Ornstein: Thanks. I’m, I’m not actively working too much on the newsletter. We’re doing, um, a bunch of other things, which I can tell you about in a bit, but yeah, I’d love to learn more about you. Seb Haugeto: Yeah. Um, do you want me to do like a quick intro now and then maybe go deeper into interview or how do you want to. Ben Ornstein: Yeah, let’s do, let’s do a cool, uh, you know what, let’s hold off the intro for the actual case study. I think that might even be more interesting. Um, cause then I’ll hear more about you and we can get right into it. Um, but so, uh, just to give you a brief background on this. So, um, one of the things Hawk wanted to do was. Create a resource for founders to learn how to fundraise successfully. And we figured, you know, why not? Reach out to actual founders who have fundraised. That’s probably the best way to do it and ask them pointed questions about their entire experience. And so how this interacts with the newsletter is I’m going to ask softball questions, things you’re going to have no problem answering. And this is only going to be payment gated behind the newsletter. So only the premium subscribers are going to have access to this. So what that means is you can be, you know, pretty, pretty open and blatant about things that that can include things like when we’re asking you about your fundraising journey, you can bring up valuations and obviously things you’re only comfortable with. But, um, your audience is startup founders here. And so, or aspiring startup founders, you know, everything in the Hauk’s newsletter kind of world. Ben Ornstein: And so yeah, we’re also launching a podcast alongside this. So a lot of interesting things coming there as well. So yeah, a lot of content being generated around this, but yeah, I mean, that’s basically it. Do you have any questions? Seb Haugeto: Um, no, it sounds good. I’m more than happy to answer your questions. And I’ve, uh, I think I’ve successfully raised four rounds in my career so far. Cool. Areas sizes, I think in total, um, a little over 2 million, 2.2 maybe. Um, and I’ve raised in the bear market, I’ve raised in the bull markets. I’ve seen some different patterns and what works and what doesn’t. So I I think I could provide some valuable insights for you guys 100 No, this is going to be a great one. Ben Ornstein: I can tell for sure. Yeah, and so so after we’re done with these questions, um, I’ll you know Take the reason we have the read ai guy in here is we use them for the transcript so I can use that To generate the the document it’s going to be like a text And um, you know once we’re done with that I’ll go ahead and send you a draft you can tell me what you don’t like what you do like and uh And then it will be turned in and yeah, that’ll be the process. Seb Haugeto: I really like that you guys sent the draft over to me for approval before publishing. I think that makes me a lot more comfortable with everything. A hundred percent. Ben Ornstein: I mean, especially when you can, if you’re being more open, you know, we want you to have like a good experience here and make sure anything that’s said either accidentally or things you wanted to add that you didn’t mention, you have a chance. So for sure. UNKNOWN_SPEAKER: Okay. Seb Haugeto: So I’m ready. Let’s do it. Great. Ben Ornstein: Okay. Well, if you could briefly introduce yourself and your startup, I think that’d be a great place to start. Seb Haugeto: Yeah, cool. Well, my name is Seb. I’m the founder and CEO of DealFlow, a next generation invoicing platform for online SMBs where you can send and pay invoices in one place. My educational background is mathematics and computer science. And I left high school with one of the best diplomas in the country. And for two years after high school, I was a professional cross-country skier. So I guess I’ve always been very competitive and I’ve been I was very motivated to work really hard to win and aim for number one. Prior to building DealFlow, I was founding CMO and B2C fintech app, where we created a cashback solution for consumers. I played an instrumental role in raising the first institutional VC around there, and also building a growth engine that later took that company after my exit to several hundred thousand users in Norway and Denmark. And I think my somewhat unique cross-domain expertise of numbers and growth gives the product I build a very clear strategic advantage when it comes to product-led growth and distribution. I’m also the first Norwegian in history to be on the Forbes 30 in the 30 list in finance. I’m a Sigma Fellow and an EWAR Fellow. And I think generally I’m obsessed with winning. And I think I have a knack for betting on the right strategy at the right time, but being very aware of what roles I play really well and what type of profiles I need around me for the team to really excel and win together. And also, when I was studying computer science, I was also a sort of travel influencer, where I traveled around the world, made travel content as a vlogger, staying in different hostels, and just being on an adventure. Honestly, traveling more than I studied, but I had a great time doing that, and effectively running my own little mini video agency during that period. It led me to discover just how cumbersome and stressful and inefficient it is to send and pay invoices using traditional banking infrastructure and B2B payment terms, which is exactly what it’s like the core problem that we’re solving in deal flow. And that frustration and the realization as sort of the first-hand experience with how real that is, has been a very important driver and motivator in my journey as a founder building DealFlob because I know the problems, I’ve seen it myself. It actually caused me to stop the whole adventure thing because it was the financial part just didn’t work out that well and it gives me a lot of fire to sort of stand up for the little guy and help those who are trying to build something but is limited by financial reasons. Limited because of financial reasons like I was once you know back in the day and And now I’m not in the same way, but I still clearly remember the feeling. And it gives me great strength to know that that’s what I’m fighting for. So I think it’s really worth the mission that we’re on. It’s about giving financial superpowers to those that dare to build a future, business owners, creators, and those that are actually out there with their hand on their plate and building. Seb Haugeto: And that has been quite successful so far. We just raised 1.1 million euro seed round a few months back on the back of, I’d say, quite insane waitlist growth, where I think our waitlist grew more than 10,000 in a couple of months in volume. And now we’re in a position where we’re just building and releasing the product to those companies on the waitlist. And we are The platform is already working. We’re running hundreds of transactions per month. I think now our revenues levels is already at a point where we’re covering our expense levels in double-digit percentages. So break-even is already on the horizon for us. And I think that is very promising given that we still have 10 million or something euros on the in monthly volume on the wait list. And given that we need three to four to break even, I think we’re heading into very exciting, exciting territory from a company perspective, from a financial perspective, and also for a seed round perspective, because I think very few companies are in a position like we are now in a pre-seed stage. I think we’ve been able to progress very quickly on the things we’ve been doing. And I think our customers absolutely love the product. So if we remove the product from them now, they would be really angry. And I’m hearing good feedback from them. And I’m very proud of what we’ve built. Ben Ornstein: Amazing, cool, amazing background. And it seems like the company’s crushing it. Yeah, could you dive deeper into the fundraising journey so far? Seb Haugeto: That’s the most exciting one. It’s been so many problems and so many challenges that I’ve had to overcome to do that. And not many people know about this because I think, you know, as a founder, you get really good at telling an external story that builds confidence in external stakeholders, so they trust you, as you know. But internally, in the early days, it’s usually just chaos. And it’s like things flying around, things not working. It’s just a facade and you’re trying to be bigger than you actually are by telling that story and posting on social media or whatever. And I think we’ve done that quite well. Especially considering how many problems there have actually been on the fundraising journey. It has been the most challenging thing in my life. By far. The second most challenging thing doesn’t even come close. It’s like a completely different dimension of challenge. And it starts with the first round we raced, which was an angel, planned to be an angel man, and it turned into like 1.2 million monster angel round very quickly. And I, as a brief summary, I actually, I decided not to take it because of various reasons. It’s a whole story to that as well. So this is back in 2021, during the heydays of the bull market that has been going on since 2010 and sort of the recovery after financial crisis in 08. And people were raising the biggest round in history, in recorded history, and money seemed to be available like tap water. So there were parties everywhere, champagne, and people were going crazy and doing a lot of dumb stuff. And that was sort of the environment. And in that environment, I had just raised 500k. Euros for my first company. I started with the CMO and first employee. But I was actually let go right afterwards due to strategical misalignments with the CEO. So we became successful right around and then I was let go and replaced me with someone else, a more experienced guy. And it was very tough for me because at that time I had just dropped out of university. Left everything behind in my small hometown in Norway and moved to another country, which is Denmark in this particular case, to join this company. So when I was that girl, I felt like I’d lost everything. I was in a country where I really didn’t know anyone. And I didn’t have an education. So it was a bit of a I’m fucked moment. Seb Haugeto: And but I think somewhere, you know, along my journey, And I learned that each crisis in itself is a great opportunity to level up if you find the courage to do so. And so I think in my darkest moment there, I decided to start my own company, do the hardest thing. You know, a lot of friends in my family at the time, they said, like, you’ve had an interesting journey, good ride now, you should come home, have a job, go back to uni. Yeah, you had a good run. But I thought, you know what? I did well, and I think I could do better. So I’m going to start my own company now, instead. And I didn’t know exactly what I was going to build or who I was going to build it with. But I decided to bet everything on myself at that moment. And I think, you know, in retrospect, it’s definitely like those moments where you’re down and you’re broken. And the choices you make then that really determined sort of the big movements of your life path. And that moment was definitely one for me. And this decision is what later then became DealFlow. And from there, it took me six months to go from zero, nothing, not even like a name or anything written on a paper, to I think 1.2 million euro committed from investors from VC funds and angels and a 7.2 million euro valuation with no product and no traction in nothing with the idea of building a bank for creators. And the mission was very much the same as I felt myself as a travel influencer and being a creative, was to support those that dared to create the future with financial superpowers, with cutting edge financial technology, which I’d worked on in the first company. I was this 24 point, a paper millionaire and just very overconfident in my own ability. And thinking back, I think that success was mostly because the market was incredibly optimistic and investors were generally looking for things to invest in. So I timed it well, I guess you could say, with the market. However, in that time, I sensed that the co-founder that I had teamed up with to raise the round was not such a good long-term match after all as we started to work together. I just saw too many red flags so quickly. So I decided to fire him and let him let him go, essentially in the middle of the round and therefore also turning down a lot of the capital because it was contingent on us staying together, working. And so I think, you know, when it comes down to I value my my long term spiritual health way more than money. And this made decision. Which was kind of controversial at the time and picked up by a lot of newspapers in the Nordics, a very clear choice for me. So I changed around and I teamed up with my current co-founder, a new team that’s way more suited, better match, and we closed a small round of 400k instead from a group of angel investors who still believed in me. And this whole process took seven months and I learned a lot about my own limits and what it takes to win, even though, you know, things seems to be falling apart, which is what I did there in the darker moments of, you know, turning down all the money. And these insights were very valuable for our pre-seed round, which was, even though, you know, this sounds like there was a lot of challenges, but the pre-seed was like a different monster of challenges. Cause it was, And we use the angel money to hire some people, we built the first version of the product, we got some traction, we learned a lot about, you know, working some payments and invoicing, building the first version, and build some expertise in the company, but our runway is still way too short. So we had to raise again. And this decision came, raising again, came right after in 2022, when YC sent a now famous recession warning, where like, don’t whatever you do, just don’t raise money now, hunker down, become profitable, you’re going to fail, the market is going to kill you, it’s going to be so difficult to raise money. And we really didn’t have any choice. So you sort of have to go for raising another round. And being I think 25 the time and haven’t really experienced the bear market professionally. So I didn’t really know what it meant, like how it felt like to be in the bear market. Cause all I’d seen like from 2010 until that point, which is growth. And I think it’s important for, you know, historical context, just, you know, growing up in that era as a kid and only seeing growth, only seeing like positive green numbers, you become delusional. Like you, you’ve never seen what, a crash, real crash, or what like fear and insecurity in the market looks like, So you have this very over-optimistic view about the future. And I think this is something that I was definitely part of myself and a lot of other contemporary founders. And I think I paid for my innocence here as I discovered that it was vastly different raising in a bear market versus a bull market. In a bull market, people pay a lot of attention to status and high-level things, signals, whatever, because they trust that the fundamentals can be figured out later, because they’ve seen that work out in the past. As long as you can create some noise and attention and people signing up, you can probably figure out how to make money. That was sort of the idea. But this is completely different in bear markets where trust and fundamentals disappear, which means that investors, they want less risk. And this typically means then more focus on product engineering and assets that are more real than status, which is very fleeting. So you have this very abrupt change in the type of founder that became successful. In the bull market, it was very much status driven. Salesy, very charismatic, overconfident type of profile that I think did well because they were able to build hype and sell and do things really quickly with everyone. And that’s a strategy that works well when people are very trusting. But when people are super insecure and they don’t trust anything anymore, then you have a different type of profile of founder that do well, which is more detail oriented, more risk averse, perhaps more inclined towards engineering. And typically, these two profiles come in very different people. But I think one of my things that makes me different is that I sort of have both. I have both that sort of math, engineering perspective on things where I can be super detail oriented and risk averse. But I also have that sort of filmmaker creative side of me, which I really you know, leaned into the bull market. And then the bear market came and I was like, okay, I need, I just need to go back to numbers now, like stop with all this, you know, sales stuff. And then let’s focus on the numbers. So I ended up doing that and relearning a lot of those possibilities. And, um, my commitment to this just drew me into a 12 month long fundraising battle where we, we almost ran out of money several times. We pivoted the business. I ended up having severe burnout symptoms like dizziness, seeing double, uh, almost fainting a couple of times and, uh, just lack of clear memory, honestly. And it was a very scary time, especially the last part. Cause then you’re like, okay, I can’t, like, I can’t think straight. This is now really a big problem for, for me and the business. Um, but I have very strong support from the team and we’ve built a super strong, you know, very good, healthy relationships in the, in the team, which I prioritized in the first round. So I think that gave me resilience to. And to continue on behalf of me and on behalf of the team. So after 12 months in the desert and, you know, I think a lot of my friends and a lot of companies that I looked up to, they all failed bankruptcy. They couldn’t raise whatever. We pulled through and we secured the, I think, 600K first tranche of the precede. And from there, it was just, you know, get the money into the account continue building, get back to product, talk to customers again, grow. And doing that, we launched our website, we talked to a lot of customers, and then our waitlist went from like 70,000 euros per month to 12, 13 million in like three or four months. So it’s like 10,000 plus percent growth. And then on the back of that, I was able to raise another 500K in our pre-seed, then in total, raising 1.1 million. And that second tranche was very smoothly executed, where I think the entire time or the entire thing from just planning execution and wrapping it up took three months, where two months was the execution time. Seb Haugeto: It was a lot. I think what helped me a lot was, you know, doing that 12 month health period where I felt like I was in the desert and it was just pain every single day. And it was nothing you can’t get away from either. You just have to go through it. And just being very authentic with myself about those feelings, everything that happened, everything I went wrong, writing, writing it down and doing like a recap of things that helped us succeed and things that helped us, didn’t help us. And created a very clear map for me of how I was going to approach the second tranche, which I was then able to execute six times faster in two months. I don’t think the market had improved that much really, a little bit, but it was still full of fear and people were not really investing in the same way they did previously. Seb Haugeto: And now we’re here, we have I think 10 plus months of runway. Break-even is on the horizon. And today we’re building an extenuation invoicing platform for online SMBs where you send and pay invoices. And I’m very excited about our vision because we’ve been so deep into this now. That our longer term vision is to build a social financial network where payments, commerce, chat, financial co-pilot and content is sort of seamlessly integrated into one smooth experience for both companies and consumers. And that’s why I guess you could say it’s a bit similar to WeChat in China, where all of these things are sort of interweaved into one app that allows you to do everything. And I think if we’re able to do this successfully, and really build that product that can deliver the experience it takes to actually pull that off, you will be able to buy and sell, run your company and discover new sources of income in a much more transparent, efficient and fair way than what is currently possible today. And it will enable a new and smoother collaboration between people and companies and not have this whole entire world is just centered around enterprise and companies, but rather create a platform and a game where the little guys also has a fair chance of entering the game. Ben Ornstein: Amazing. And that 1.1 million euros, what valuation was that at in total, if you’re comfortable? Seb Haugeto: Yeah, so the post money valuation in the second tranche was 10 million euros. Ben Ornstein: Awesome. Congratulations. Ben Ornstein: And so I’ll ask two questions in one for this, or actually prior to that, you know, when you were raising this money, what did you plan to use the money ahead of time for? Was it like solely for growth and, you know, paying employees and stuff like that? Seb Haugeto: Nothing. I mean, we have a product led strategy, um, where. We don’t spend anything in marketing. We have no sales team. We don’t do marketing. Like all, all of the money is used for engineering and product. Um, which makes our product quite unique. And it’s a funny, funny thing. Actually today we, um, we might’ve had our first successful, um, systemized invoice referral, meaning you send an invoice to a company and that company, because they got the invoice, they also become a customer. Ben Ornstein: I love that. Seb Haugeto: Yeah, very like as exponential process and it’s very hard to pull off because there’s a lot of details involved everywhere. But it looks like we might have been able to pull it off today. Seb Haugeto: That just means the customers will just come in, like, you just have to run the operations and then build a better product and you’re good. And it’s very compounding effect because if you can do that, you can just focus more on engineering because that drives growth. Have more money and more engineering, better product, more growth, better product, more growth. And then it, it sort of spirals into something very powerful. Ben Ornstein: It’s so cool. You’re focusing on building a product that is actually good. You’re not focusing on the bullshit, which is awesome. Um, that’s yeah, focus on the right stuff, which is cool. Seb Haugeto: It’s really hard because the world doesn’t really care or investors don’t really care. They care about the numbers and sales drive numbers. Ben Ornstein: So Right, and you only come from a good product. Seb Haugeto: Exactly. So it’s like a bit of a different difficult game to play. But if you’re able to get there, it’s I think I think you can do great things. 100%. Ben Ornstein: And so I’ll ask this one as a dual question. So when you were getting in touch with investors, how did you get in touch with them? And then when did you when did you decide or how did you decide they were a good fit? Seb Haugeto: I have a monthly investor newsletter where I update every investor that I’ve been in touch with. Seb Haugeto: And that has brought a lot of inbound traffic for us. And the way that works, it works in a very technical way. So investors typically, because I post a lot on LinkedIn, I have some external status because of the Sigma, Ewar, Forbes, like these things. It gives me a certain credibility in the market and then investors see that and they reach out and they typically send me an email. And when they do, I synchronize that with HubSpot and I organize all investor contacts in HubSpot. And then that is synchronized with customer IO, which is our email automation service. And then I just send out a monthly update through customer IO to all the investors that I’ve been in touch with. And I have two lists, one for potential investors and one for existing investors. Potential investors is like Basically anyone that’s talked, I think it’s like 230 investors or something now, uh, ranging from address the Harvard’s to Sequoia partners, to like angel investors in the Nordics. So it’s very varied and it’s quite a big list. And, um, potential existing investors is just our investors and that investor newsletter has, you know, we, I think we have a wait list of like 40 or 50 investors that wants to talk to us for our seed round now, because they followed along and it’s almost like I’m just telling a story, right, telling a story every month and they follow along and become intrigued because they start trusting you a little bit more because they read it and they can see you execute, they can see that, you know, you say something and then you do it. And we’ve been very focused on that, or I’ve been very focused on that, and I think we’ve done that well. So it’s worked for us. I know there’s a lot of other channels you can reach investors like, you know, platforms and, you know, doing like intro mapping and, you know, creating lists of all investors you want, having, going on LinkedIn, seeing who can introduce you to them, and then just reaching out and sending a message to all of them and getting an intro that works as well. But I think the most important thing is just to understand where you are in position as a founder and what kind of strengths and weaknesses you have and what channels you have actually access to. He’s doing something like I’m doing now. He’s not really possible if you’re first time founders just starting out with no network. That’s going to be really hard. But what you can do then, because then you’re more hungry and you have other things you can do, is to be aware of that and then choose a strategy that is suited for your position. Seb Haugeto: But yeah, if you’re in a position like me, I’ve done it before, I’ve raced around House of Credibility, then I think a newsletter works quite well. As speaking to a newsletter, I think yeah, you’d agree. Ben Ornstein: Yes. No, that’s a cool process and leveraging like storytelling is, is such an effective process and you’ve, and you’ve created a process around it too, which is awesome. Um, so you made it scalable and sustainable. Seb Haugeto: Yeah, exactly. So that’s worked quite well. Um, yeah, a hundred percent. Yeah. Ben Ornstein: And so in the early days, you know, when you were reaching out to investors, Could you provide rough numbers for like, how many people you reached out to, the subset of those that, you know, you got first time meetings with, and then the subset of those that actually ended up investing? Rough numbers, doesn’t have to be accurate. Seb Haugeto: I reached out to hundreds of people. I got so many notes, like it’s insane. Ben Ornstein: Oh, good question. Again, rough numbers, it doesn’t have to be, you know, totally accurate. Seb Haugeto: I think I must have talked to 200 people. Well appreciated in total. And we got 20 investors. Seb Haugeto: So that’s, you know, 10%. Ben Ornstein: That’s pretty high, actually. Seb Haugeto: But yeah, but yeah, I guess. Well, I got meetings with most of them. Seb Haugeto: But again, that is purely because of the status that I have in the market because of logos. Because they’re like, oh, he’s on Forbes. I’m going to take a meeting with this guy, or he’s raised before, or he has a scout ticket from Endurance and Horovitz, and I’m going to take a meeting with this guy. And I think the most important thing for founders to be aware of is that the venture game early stage, before you have numbers that prove that, OK, the machine you built works, you can make money, before you have that, it’s very difficult for people to actually differentiate between what’s going to be successful or failure. No one really knows. So just betting on what they think is familiar. And, you know, student going to Harvard is something that’s familiar for a lot of investors and they feel safe and that’s why they choose it. And there’s definitely ways to go around it. Like I dropped out and I didn’t have any logos at all in the beginning. So you can go around it, but it only works if you’re aware of of that. Like, are you a person that have already that credibility because you prioritize going to tier one university or, you know, working at a big company, then you should play on that. You should really go all in on making sure that you make that clear. If you don’t, then you got to realize that you you’re playing against a lot of players that have something you don’t have. So what are you going to have that they don’t have? Sort of Ben Ornstein: Yeah, no, a hundred percent. And well, I, I, along with the credibility that you, you built online, you probably also had an interesting pitch. So like, what, what did you emphasize in that pitch? Seb Haugeto: Um, it was different from every race. Seb Haugeto: Um, But I think you end up after raising and you’ve seen the deal, you’ve seen sort of what you have. There’s a couple, usually a couple of things that sticks out. Like that’s really great. You know, that is something we can, that will impress people. This will be exciting for people to hear. And you pick up those and you make that very clear. Um, and for example, in the second tranche, it was weightless growth, like, you know, 10,000% growth. That’s something like people see that and they’re like, Whoa, that’s what is this? You know, and then they have, you have their attention. And then from there, it’s really, it’s actually a lot more important than you think for founders to create an amazing, compelling pitch deck with a super clear storyline. Um, that just reads and the, the, um, the reaction you want from investors is. This feeling of warmth and excitement at the end of reading it, where they’ve sort of understood the story, they’ve understood how this can make money, and if you can get them to that point, I think you’ve done a lot of things right. But it took a while for me to realize that that’s actually a lot more important, I think. Seb Haugeto: I’d actually advise people to just work with your investors, or if you don’t have investors, An advisor to really make the deck great And friends of mine that are really good at raising money that raise you know Without we can raise without a product or or really a team and raise millions They one friend of mine he spent eight months just working on the deck Full-time almost and then he’d raise around after that and it takes a long time to do it like I It’s really hard because you’re sort of building a deal. You’re building, there’s so many things and you’re basically productizing your company. So you’re doing one thing on the one hand, which is like, you know, building a product for your customers and you’re trying to solve problems for them and make sure they love it. But that’s a different thing than building and raising money because then you want to turn like the product out for customers, the team, everything around it, and just package it, put it on deck, tell a story about it. That’s clear if you can understand it in like 30 seconds. That translation is really hard. It takes a lot of work and you should really prioritize being world-class at that if you want to raise money. A hundred percent. Ben Ornstein: And when, when you were closing the round, how did you drive urgency among investors? I know that may have been difficult, you know, during this, this latest funding round, but yeah, how’d you do it? Seb Haugeto: Well, actually, I had great help from existing investors using say the, uh, I think the first time is a good example. Cause that was like, hell man, it was just so difficult. It was like a year of just pain and nonstop suffering actually. And at the end of that first ranch, I had a lot of people that are interested. But no real way to close it or create that last bit of excitement. You need to push people over the edge. Seb Haugeto: And what I ended up doing there was I joined EWAR, which is sort of the YC of Europe, and it’s an investor and a startup, like an educational program for founders that helps you build companies similar to YC. Seb Haugeto: Daniel, the founder, he had a lot of people trusting him. So he already had some credibility in the market. And then I had him and I had a Unicroft founder who joined as well as an angel. And one other guy who I had to go all the way to the Galapagos Islands. Ben Ornstein: Whoa. Seb Haugeto: Because we had these two guys and I needed one more compliance guy to join before those other two guys wanted to commit to being the lead. And I couldn’t find it because no one wanted some vests. We’ve been raising for a long time, we weren’t growing because I wasn’t spending any time on commercials. I was looking everywhere and talking to everyone I knew and I couldn’t find anyone. And it was only when I traveled to Ecuador and then the Galapagos Islands that I met this banker dude from New York that wanted to join and wanted to take the risk. And then he joined and created this lead. And I had this lead, like a lead syndicate of angels. Seb Haugeto: 15 other investors that all wanted to join with smaller tickets. And what I did was I did what I call an email signature round. So it’s like a marketing tactic where you have your lead. Seb Haugeto: join you on the plan as an insider. And the plan is to send out an email to all these investors with everyone on CC so everyone can see everyone and everyone’s reply. And then you send like an email saying, hey, we’re closing this now. We have this much committed and we are raising a maximum of 400k if you have 300k committed. Seb Haugeto: And we’re closing it on Tuesday. Please let me know and this thread if you want to join and Really like risk it like that, right? And then the the syndicate they join Replying afterwards like yeah, we’re gonna do this like so excited like this is gonna go to the moon and then another lead syndicate joined to say the same thing in another and then what happens is that people they become excited and they’re like, oh there’s you know, there’s credible people doing this is unicorn founder probably know what they’re doing and And then they join and jump in as well. And then they reply to email thread. And I think just through that, we raised, we got like 50 or 100K extra. And that allowed us to close it. And so that was the thing that helped me close the first trench after a year of desert. Ben Ornstein: That’s a really interesting strategy. I love that. I don’t know why more people don’t do that if you have you know, an investor network. That’s, uh, seems like a really good strategy to employ. Seb Haugeto: Yeah, it worked really well for us. And if you have your lead investors join in as well, it’s amazing. Like it’s, you’re just creating excitement and incredible FOMO, which is very different from your real fake FOMO, but yeah, the email signature round went really well. Cause then everyone is out. They, Um, they, uh, they signed afterwards. Ben Ornstein: Yeah. And yeah. So going into a little bit of a, do you have a little more time? And I think this was scheduled for 45 minutes, but we have a few more questions. Are you pressed for time? Seb Haugeto: No, I have a bit more time, so it’s fine. Ben Ornstein: Perfect. Okay. Only have a few more questions. Um, but yeah, so you’ve already given some great advice so far, but, um, is there any other pieces of fundraising advice you’d want to give other founders? Seb Haugeto: Yes, a lot. I think the most important thing that I realized is that you’ve got to think about fundraising as a completely different thing from building your company. Seb Haugeto: You can have the same product, same company, same team, everything have a sort of average deck from that and not have it perform at all and not raise any money. And then you can have the same company, but you build the deck with an insider investor who knows the game and knows the language and you can raise 10 million from it. Seb Haugeto: It’s, it’s that, extreme actually. Seb Haugeto: And I think just being aware of that, that investors that just being the mindset they are in is like they have thousand deals coming at them. They have limited attention. They don’t want to go in depth because they don’t have time for it. And the single thing they judge your company building abilities on is your ability to tell a story in the deck. Seb Haugeto: That’s what they’re looking at. Like, can this founder communicate clearly the story here? Seb Haugeto: And that’s not the same as building your product. It’s not the same as, you know, getting your referral system to work. It’s not the same as getting a marketing campaign to work for a while. It’s not the same as hiring amazing people. So you can do all these things and be the best founder in the world and, you know, build your company and do great things and be profitable. But if you can’t translate it into a story that investors find exciting, then you will really struggle to raise money. Seb Haugeto: And it took me a while to realize that, but I think being very obsessive about recaps and learning from my mistakes, I’ve been able to gain clarity on this. Ben Ornstein: That’s amazing. Um, looking at the investors that you have, is, is there any, is it like a section to, or a chance to call out any investors you’d recommend other founders work with? Seb Haugeto: Yeah. I’d like if, I mean, in Europe, I’d recommend you to work with Daniel Dippel from EOR. Um, I think he is one of those exceptional guys that have the analytical intelligence to really break things down and go in depth, but also a very, very extroverted approach to network building and knows a lot of people and he’s young, very hungry and willing to take risky bets, actually, which is rare to find in Europe. So I think he deserves a little bit of a shout out and he’s helped us a lot also, so it’s totally fair. Seb Haugeto: Man, I should have made like a thank you list. Ben Ornstein: Like this is, you know, it’s, it’s all, you know, this isn’t going to the general public. So, yeah, no, I know, but all these guys, they read it and, um, I mean, and if you prefer, we could just take this question off. That’s also. UNKNOWN_SPEAKER: Yeah. Seb Haugeto: I think I’m just going to mention like, uh, the lead cynic in the second tranche, they put all their faith in me. Um, Daniel and Ralph Reichert from ESL gaming and, uh, Petter Mala from SumUp, one of the co-founders of SumUp. I think they really, they took a bet on me and that’s, um, they deserve, I mean, That’s, it comes with a lot of respect for me because, you know, taking risks is the only thing that really creates anything. Uh, and most people, they don’t really like to do that. They’d like to hide behind, you know, protection and whatever. Uh, but those guys really took a, took a good risk. UNKNOWN_SPEAKER: Amazing. Ben Ornstein: Are there any resources that you would recommend other founders? This could be, you know, podcasts, blogs, newsletters, books, anything. Seb Haugeto: I’ve got a lot about this question because, you know, I hear a lot of founders talk about reading books and reading and doing a lot of these things, but I did a lot of that previously. But I’ve actually found, like, for me, the fastest way to learn things, like, from really fundamentally and in a way that allows you to approach things with sort of an original mindset and first principles, first thinking. Is to take a lot of action. Like, as the founder of Clingbase Brian Armstrong said, I really like, you know, action produces information. And if you just continue executing, And having a rigorous process for recaps, meaning you do something for a month, at the end of the month you go and you go back to the target at the beginning of the month, you recap it, like what did we do well, what didn’t we do well, what do we have to change here to make it be successful next month. If you do that, that will accelerate your learning so much because You might think you know what went wrong, but I’ve found in most cases you actually don’t because there are a lot of things you haven’t thought about. And just isolating the core problem and being honest and authentic with yourself about what actually happened, even though it might hurt your ego or it might be It’s scary to think about. Like, things that are connected to your personal personality are things that are really hard to change. Like, if that causes problems, then that’s difficult to sort of process because you don’t really know how I’m going to change my personality. It’s a difficult problem. But it’s actually a lot better to know it, that this is what caused it. Like, my personality or the way we did this or whatever caused the problem. You’d be surprised how much you can learn if it’s clear. So I’d say yes, of course, you know, you can find a lot of lessons on what books you should read and whatnot. But really, I think a competitive advantage is to be willing to take risks, execute, and then be Brutally honest with yourself about the situation and why you didn’t win or why it went wrong or whatever That process is it’s really tough. It’s hard because it requires you to unpack everything about yourself really if you want to do it properly and that’s something that most people aren’t willing to do because it’s scary and Then you have your competitive advantage because there’s only a few people that can do it That’s a really cool answer to the question. Ben Ornstein: I like that a lot. Um, that’s great. And, uh, our last question is, do you have any hot takes regarding the fundraising process? Seb Haugeto: Um, yeah, yeah, too, actually like, uh, two tactical tips that I think could be valuable. So number one is the email signature round, I think is a very effective way of creating FOMO online over email with investors if you have a bunch of them. The second one is to use a, when you close the round, use one contract for each investor if you have an angel syndicate. Because that allows you to cross it continuously. And send out a contract signature money. Send out the contract signature money. And it reduces the stress to have everyone sign the same thing. So that was, I think, two tactical tips. And the third one could be that to really you What kind of uptake were you looking for? Ben Ornstein: Yeah, just things that people disagree with you on or, or yeah, yeah. Seb Haugeto: Okay. Ben Ornstein: Things that may, maybe not everyone disagrees with you on regarding. Seb Haugeto: Yeah. Um, I think VC as we know it is dying and VC investors should focus on learning how to build profitable companies instead because it’s not a very profitable career. Ben Ornstein: I like it. I actually don’t totally disagree. I think the landscape is greatly changing and the VCs that are going to win are not going to be what the VCs looked like, I completely agree with that, but it is a hot take. Ben Ornstein: So I think it is contrarian. I agree with you. There’s a large subset of people, including, you know, the current VCs themselves who would disagree. So, um, no, I like it a lot though. Seb Haugeto: Thanks Ben. Ben Ornstein: Well, thanks so much, Seth. I really appreciate it. I love hearing, you know, all the stories, everything about deal flow yourself. Um, I think this is going to turn out into a really, really great one. And yeah, I’ll follow up, I don’t know, within a week or so with the first draft. Seb Haugeto: Amazing. I have one thing I want to ask you for Ben. Ben Ornstein: Yeah, of course. Seb Haugeto: As part of the case study, we’re hiring two critical roles right now. Okay. A senior banking engineer and head of finance. Cool. And we want the best in the world to join. And would you be okay with me, us putting in that as sort of a part of the article so we can potentially generate some leads from that? Ben Ornstein: Let me talk with Hauke about that. I shouldn’t, it shouldn’t be a problem as like a PS at the bottom, but I, I’m not, I’m not going to give you like an answer. Cause I I’ll have to check with Hauke about it. I don’t think it should be a problem, but, um, and I can obviously see why you’d want to do that. So. In the email while I send you the first draft, I will give you the answer to that question. Seb Haugeto: Okay, amazing. Thank you. Of course. That’s the deal. Ben Ornstein: Awesome. All right, so we’ll have a great rest of your day. And thank you for taking the time. I really appreciate it. Seb Haugeto: Sorry, you dropped off the last three seconds. Would you mind saying that again? Ben Ornstein: Yeah, no, I was like, thank you so much for your time. And I hope you have a great rest of your day. Seb Haugeto: Thank you. Likewise, Ben. I appreciate you wanting to have me on the on the newsletter. Ben Ornstein: Of course. All right. Have a great one. Seb Haugeto: You too. Bye.