This is the second of our two part series on the Startmate Retreat 2016. Looking for Part 1?


The sun breaks early in this part of the world. Bleary eyed I cracked open the door to catch the fresh January morning in front of me. The old shearing shed was a cosy remnant of a past long forgotten, although spartan it served us well for a nights sleep, all the while remaining true to its working class heritage. Today was an early start and Sam’s preview the day before suggested it was going to be a long one. A brief shower and we trekked back to main house for some breakfast and the stark realisation that I’m not a good enough engineer to stop a Nespresso machine from flashing at me, somehow however I was able extract just enough caffeine to return to humanity.

Straight into day two with pitching practice, for most teams here it was the first time in front of a large audience. This session was about a starting point, a point in space in which to identify what you need to work on and what indeed is working for you. The feedback was great, concise if not brutal, but welcome and to the point. There are clear things we need to work on and the feedback was welcome. I thought I would share some of the key elements I heard most often.
  • If you have a product, don’t waste time being abstract.
  • Be concise but specific
  • Sell the certainty of what you’re doing – be less Australian
  • Spend more time on the team slide, describe why you’re the best in the world to solve this problem
  • get the Hook lines out there ASAP, if you have traction – show it
  • If investors don’t understand what you’re doing then maybe they aren’t the right investors for you
  • Sell certainty, remove ambiguity


Rayn Ong followed up with a very insightful talk about fundraising and the mindset of investors. Rayn is a great proponent of the Australian ecosystem. He’s engaged and active in events and activities across the community, pleasantly more so than I would expect as an investor, perhaps that’s his engineering background coming through. He knows where most of us have been as engineers so he can relate to us as founders. Most importantly he’s always good for a laugh – what’s the point of any of this if we’re not having fun. These are some of the key insights I grabbed from Rayn’s talk as well as some of the comments he made around the table:
  • Investors are a small community and regularly talk to each other
  • Investors don’t want to pass on poor leads to their friends
  • Use “true believers” to your advantage
  • Qualify your investors in terms of their deal size, considering how much you need to raise, how many investors will you need to close a round?
    • How does that look on your cap table?
  • Always have a 10x mindset
    • How do I make this company 10x bigger


I feel like I could write a whole post about Evan’s contribution to the weekend. He has such a depth of experience that it’s almost hard to absorb everything he talk about. I’ll try and be concise with what I’ve learned in my points below. The one thing that resonated with me about Evan was his incredible ability to create deals and make them work. I’ll follow up more about that in his second talk, but the focus of this one was specifically around fundraising, term sheet negotiation and governance.


  • Evan discussed the importance of building insider status in San Francisco. In a town governed by relationships, Evan outlined how important it is to have strong, close relationships of inside connections. Mindless networking can be a time kill and a bad intro could kill you even before your investor meeting. Consider that investors also rank themselves internally and build close relationships so being strategic about the introductions you procure is important.
  • Following on from Rayn’s comments earlier, Evan expanded on the ticket size per deal idea, finding investors that are the right ticket size for your deal are important. If you’re looking for close a million dollar round, then 10k ticket size investors aren’t the right fit, however sometimes investors will do larger deals for companies they are bullish about so the conversation is important.
  • Raise more than you need
  • Raise for at least 2 years of runway
  • Control matters. Expect that at some point you will lose control (e.g. Series B and beyond), but don’t give up that control too early in the journey. In terms of equity you still control at least 40% ownership until you hit later rounds.
  • Price and valuation is a function of supply and demand
    • A deal might seem pricey to an investor but if thats what the market is willing to pay, then it’s justified
    • Negotiation can also happen on terms, so while valuation is important, don’t forget that terms are equally important in the success of the company
  • Build a relationship with investors, long before you choose to raise money
  • You can build the credibility by asking  for advice and laying a few markers so you can pick up on them later on
  • New money in future deals pushes out old money in a deal, sophisticated investors will be less concerned about dilution as long as the company is increasing valuation and you’re not down-rounding
  • Is this company heading for a trade sale or IPO?
    • Potentially a third answer that this is a dividend business, but this won’t appeal to VC investors
    • Investors need to see the path to liquidity event
  • Ideal world is to have somewhere between 3 – 5 investors on the books
    • You can create competition between investors
    • You also don’t want to manage too many investors
    • There’s usually not too much conflict with 3 – 5 investors
  • If you get a No, don’t let an investor escape till you get a reason why they aren’t investing
    • Find out why you are a no
    • If they don’t say no directly, then its still a NO!
    • draw out the objections, even if their tone seems positive
  • Don’t bluff term sheets if you don’t have them – investors talk
    • but once you have the term sheet, use it to your advantage
  • Can potentially top up big investors with advisor shares
  • Pro rata rights for follow on are a good indicator to the market during subsequent rounds
    • No follow on is also a bad indicator
  • Unreasonable persistence
    • Don’t give up even on close to death experiences
    • Most great founders have been close to loosing everything more than once
    • You need to be cut out to be like this
    • Not all founders can deal with that


Evan’s talk really resonated with me not only what he and Rayn had to say about investors and investing but equally important was the conversation around the table. I felt like I was the fly on the wall of the best startup board meeting in Australia. We then headed out for some lunch by the pool, to eat and continue the conversation with Evan. The daylight strained my eyes as we left the dining room, and the day has changed from the brisk coolness of the morning to the dull heat of the afternoon. The din of the cicadas quickly reminded me of life outside, the fresh air was a welcome change.


The second half of the day was less formal but no less packed than the first. Evan continued the conversation by sharing his perspective on strategic alliances and corporate partnerships by sharing some incredible war stories from Looksmart, Better Start and Betterplace. I was absolutely absorbed by this talk. I feel like the time Evan spent at Mckinsey may have shaped some of these scenarios and their outcomes, they were unbelievably fascinating, especially his perspective on deal structure.
  • The first story focused around Looksmart, which Evan took to the US in the late 90’s. He outlined early financing with Reader’s Digest. A large deal that also saw Reader’s Digest owning most of the company for around $8m, unfortunately, structurally internally, Reader’s Digest didn’t have an appropriate budget allocation for the investment which saw some sniping from internal parties and a CEO movement saw the old guard of Reader’s Digest divesting from this new thing called “the internet”. Desperate to save the company, Evan structured the Reader’s Digest exit in such a way that it made sense for them to hang in. It would cost them $5m to wrap up the company, pay severance and wind things up. Alternatively they could give Evan around $1m (apologies I don’t know the exact number here) to keep the company going until further fundraising, drop their ownership and keep some equity. Not only did Evan save the company, but you see his exceptional ability to work a deal that appeals to both parties and works the outcome to his advantage.
  • Evan shared an analogy about a dinner party and how that plays out when doing a deal. You want to be the one that is hosting the dinner party, you decide who is invited, and who is not invited. Everyone should want to come to your dinner party – its up to you to generate interest. Since you’re hosting the dinner party, you can also decide who is no longer invited.
  • Next up Evan spoke about Better Start. Born out of the ruins of ABC learning centres, Evan described his side channel approach to beat the venture capitalists at owning the liquidated assets of ABC. What astounded me was how he structured the deal and lobbied the right people to make the deal work, let me break it down as best I can;
    • Obtain a list of investors that can take up the assets
    • Evan managed to secure some charitably organisations to put up $30m of the required $100m or so
    • Lobby the government to put the right pressure on liquidators to take the Better Start deal ahead of private equity – after all, genuinely Better Start has the interest of the child care centres at heart so the story is valid and genuine
    • Once the deal was done, Better Start returned the money to the charitable groups at a 14% premium which means they are absolved of debt but still a large ownership of a profitable company – everyone wins.
  • Although better place came to an untimely demise due to the operations of the parent company, the Australian arm had some incredibly lofty goals. Based on what Evan told us, we may have seen and all Australian electric large car and charging stations in a major brand of service station throughout the country. This is circa 2005, the renewable landscape in this country would be monumentally different should the parent company have survived. Most appealing for me was the deal structure of this deal, the key takeaway for me, was;
    • Find the outcome you want to achieve
    • Do what you can to make it easy for your opposite to say yes


Sam Maclean came next to give us a good overview of PR, Sam ran Getup and has been dealing with the media since he was 19. He described some of the challenges of dealing with media as well as when publicity is good and when to back off. Here were some of the insights for me;
  • If you are caught in a bad situation regarding media, back away. Don’t dig yourself a hole or start to fight the media coverage, it will never go well for you. If you need to, call the mistake, apologise and come back later with a feel good story about how you’ve done better
  • You need to be interesting enough to be written about, this might be because you’ve done something interesting or raised some capital. No one really wants to hear that you’re building the next Instagram though, so when you’re dealing with media contacts, give them something interesting to write about.
  • Don’t waste time and money on PR when it’s not important to your business, if you do some media too early and you don’t have a great story, then for the next 6 months that PR piece will all that you’ll be remembered for on Google


As the day drew to a close, we were spent. My brain was at capacity and thoughts were running through my head on how I can relate what I learned to CompeteShark. Its going to be a massive 5 months. Both Kiran and I are looking forward to the task ahead, we have some lofty ambitions, but with the help of the Cohort, Mentors and our Investors on hand – we’re going to get there.


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Co-founder of CompeteShark and passionate about making sense of competitive environments. Missed intel on competitor moves one too many times so decided to build a solution. Spends a lot of time writing code behind the scenes but writes the odd blog post when CompeteShark unearths something interesting.