The Startup Kids Page #3

We went on a trip to London,

Barcelona, Vienna and Berlin

Berlin was the last stop, and

the idea was just to feel out

the city a little bit and see

if it would be were we wanted to

move. We were in Berlin and we

were there for about a day, I

think, and we immediately

thought, okay, this is the

place. There are so many

creative people here. It's a

good tech scene so actually that

same evening when we got back to

Stockholm, we were like, you

know what, screw it, we are

moving to Berlin next week. We

took one week, rented out our

apartments, packed a big

suitcase and then moved over to

Berlin, and the next week we set

up an office at a local caf

there, and, yeah, it turned out

to be even better than we

thought, so we stayed.

You know, a lot of people talk

about bootstrapped startups but

that was like, should be in the

dictionary of bootstrap. I mean

we literally, moved over with a

rucksack each and that was it,

We were in a caf, and then our

next office was a conference

room of a friends start-up, I

think we lived there for a

couple of days, then they kicked

us out. We found our own office

which was this, almost like an

old abandoned attic, were we

pulled the cable outside the

window to get internet in there.

We had five good chairs in

Stockholm, we had gotten them

from another entrepreneur for

free, so those we decided to

bring down from Stockholm to

Berlin, so I think we had a

friend who took them in his car

or something, and then we were

rolling them around Berlin.

The music scene in Berlin is

fantastic so on the weekends we

would be out clubbing at all

these fantastic Berlin clubs,

from Friday until Sunday evening

and then, you know, back on

Monday, just like coding, you

know, the whole week through,

and I thing that went on for

like half the year or something

just no break what so ever.

In October 2008 SoundCloud

launched their product after

being in private beta for more

than a year.

When we decided to open the site

for the public, we thought, well

we are in Berlin, so the right

way to do that is at a club,

so we actually threw a launch

party at a club that our friends

have called Picnic. We actually

launched at twelve o'clock at

night at the club, like, we had

Sean, our chief architect was

sitting upstairs in a small room

with a laptop deploying the site

and we were like, Eric and I

were behind the DJ desk

launching the site on the dance

floor and we were just like

okay, it's going to crash, it's

going to crash, but it survived

it survived the whole night and

the morning after, I was a bit

tired but, first thing, when we

woke up, were just like, is the

site online and it was online.

We started seeing, we had

sign-ups through the night and

from there on we were

open and full on.

Alexander drew attention to his

company in a creative way.

It involved a leather jacket

and some spray-paint.

Every time I was doing a talk at

a conference I made sure that I

had some point in the talk were

I could turn around so that

people could see this jacket,

the back of it. It's good, like,

there was pictures of this

jacket, all over the web and

people were talking about it

because it looked kind of cool

and I know so many investors

that remember that jacket so

that was actually a good thing

for us to, you know, to get the

VCs who see tens of new

start-ups every day, to actually

remember ours, and so you know,

a jacket, some spray-paint, and

a cheap H&M jacket, it was

probably, you know, a pretty

good 50 euro marketing

stunt.

SoundCloud now has more than 10

million users and 60 million

dollars in funding. Their users

include such high profile

musicians as Rhianna and

Kylie Minouge.

You know, almost, everybody in

the company, knew about it.

I had this thing that the day

that Bjrk signs up I'm going to

take the day off, then we are

done and it was probably about

6 months ago that she signed up

in preparation for the new album

and started posting this really

awesome little sound bites where

she was talking about the new

album and that just made my day

and then I was just, okay, I

have to take the day off and ten

minutes later I realized that

the only thing I wanted to do at

my day off was to work, so then

I ended up going back to the

computer and actually ended

up working that day anyway.

To turn an idea into reality the

entrepreneurs often need to meet

additional costs. That's where

the investors enter the picture.

They give the entrepreneurs

funding in exchange for a part

of their company. Venture

capital firms and angel

investors are attracted to

start-ups because of their

potential to grow rapidly

for a limited investment.

Well I think, that angels tend

to be private individuals

people who have probably had

successful businesses themselves

in the past, and now they are

looking to invest some of their

own capital into early stage

companies and they are usually

doing it partly to get a return,

to make some more money but

partly, also because they enjoy

doing it, they see it as a great

way of mentoring and working

with young people in early stage

companies a venture capitalist

is someone who is really doing

that as a job so we have

typically raised money from

bigger funds like pension funds,

like government and we are doing it,

to basically return money to our

shareholders.

If I'm loaning money to someone,

I kind of want them to succeed,

but mostly I just want them to

pay me back. In the case of

making an investment in a

business, I want them to succeed

really big.

The process of venture capital

is either we find you or you

find us and generally when we

are looking for you, that is a

good thing. When you come to

find us, it is more of a shot in

the dark, fifty-fifty.

First and second time you start

a company, it is very difficult

to get VC money instantly, you

have to know some angels and it

is also a very good education to

have some angels to help you out

who can then take you to the VCs

because if you are just fresh

out of school you do not know

the VCs, you don't even know

what a VC mean, maybe you think

it is a toilet.

You give your pitch and you meet

all these different investors

and visit

the venture capitalists

at their offices down in Menlo

Park. You give maybe a half

hour, forty-five minute pitch

and you talk to bunch of

different investors and after a

series of more meetings then

they decide if they will invest

or not.

We raised about a million

dollars and the feeling until we

finished raising was the feeling

of fear, would any investor buy

into this and would we actually

be able to raise the money.

Jessica Mah is the founder and

CEO of InDinero, a company that

creates software to help small

businesses better track and

manage their finances. Jessica

has been building businesses

since she was 12 years old. She

finished high school when she

Rate this script:0.0 / 0 votes