The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
00:12:01 · Carles Reina, Harry Stebbings
[00:12:01] S0: Depends on the product that you're building, right? If you're building something in the healthcare space, it's an absolute no brainer, need to actually go to healthcare. But you can still take a very broad approach within the healthcare space, right? So you can actually target hospitals, can target like clinics, you can target bigger ones and smaller ones, you can target like practitioners. You can target across the entire spectrum of your vertical. Target as many people as possible because truly, you might have a guess or you might have an intuition of what's going to be performing, but the best companies in reality started in one end, ended up winning really good traction in a completely different end that they were not expecting, right? So if you can target as many people as possible, you will understand what resonates, what doesn't resonate, how quickly they're moving, and essentially then you can fine tune your pitch and your name account list in that area. [00:12:45] S1: If we go back to the outbound element on the leads that we have, what did we look for that suggested a great lead that was a qualified lead that we would go after? Was it the fact that they had an email extension that was exantia dot com or whatever that was, and it was a company name? Was it usage patterns? What was it?
00:13:03 · Carles Reina
[00:13:03] S0: Nothing at all. It was like so random, like I had absolutely no idea. Like in the early days, we were signing like enterprise contract with Gmail accounts. So we remember like, this is like early days of ChatGPT. People were building applications left and right and thinking like, I might need to add some voice here or there, even if it's for dabbing or for voicing some of the narrations and all that stuff. The reality is there will be all of these developers, like single developer shops using a Gmail account saying, Well, I want to add boys, but your self-service plans are not enough because they have some limitations on caps, and essentially I would need all of these additional things. I was like, Okay, fantastic. Then enterprise is the right path. We'll customize it for you. Blah, blah. And what I used to do is it got to a point where I was doing thirty minutes calls, I would do maybe 50, 60 calls in a single week back to back. And I would tell them, within thirty minutes, I knew if they were qualified or not. I knew they were interested, if they could move quickly. So what I would do is I would set up a trial by the end of the day. I would commit on the call on the spot being, By the end of the day, you will have heard from me. I will set up your trial. You will have access to the contract so that you can start reviewing it. And if you need anything, just ping me at any time, and this is my WhatsApp. What you end up creating is this dynamic that you would end up building a very close relationship with those companies. They will message you on WhatsApp, and even up to date, if one of those very early ones have an issue, they message me on WhatsApp, and essentially we try to fix it. Right? But that is the type of relationship you're going to be building with your first customers because essentially they will be there for you forever. They're not going to switch away because we have such a good personal relation it's an absolute no brainer. Just if we go through that, questions to ask, which really clearly showed that they were a great high quality lead. In those thirty minutes, if you were to advise me, I'm
00:14:52 · Harry Stebbings
[00:14:52] S1: a technical fan, imagine I'm Matty. Dude, how do I know if they're a good lead? What questions do I ask?
00:14:57 · Carles Reina
[00:14:57] S0: For me, it's like slightly different from what the traditional sales methods are, right? But I wanna know, like, what are you building and what is your vision for your company? How are you thinking about, like, the entire market that you operate? Essentially, who are you? Are you technical? Are you not technical? What are you gonna be doing with the product in general? Do you need to involve a lot of other people or not, right? For me, those are the core questions in the early days, specifically on developer economy, or if you're targeting developers, that tell me if you are ready to actually buy this, you're only playing a little bit to understand whether it makes sense or not, or how hot things are gonna be playing. Because if you think about it, different markets have different type of profiles, right? It's like in The U. You need to be very direct, and it's a lot more aggressive sales in nature. In Europe, we're always in the middle, right? But if you go to LatAm or if you go to India, people don't have an incentive to actually tell you no. So you end up getting stuck. You don't qualify well, you end up getting stuck in endless loops of trials, chaser emails, and so on of people that, for a cultural perspective, they're not going to tell you no, but they're not going to buy. Every single market has a lot of variations, and because I've actually built all of them across the world for ElevenLabs, I know all of the details for all of those pieces, right? So if you tell me, like, Okay, I'm building a company in Mexico City, then I can tell you, like, These are the core items that I would like to understand from a qualification perspective in the first few minutes.
00:16:21 · Harry Stebbings
[00:16:21] S1: What ACV does it make sense to have reps on? And what I mean by that is you said there are 50 to 60 calls. Is it like 10 a year you can start to have a rep led approach? Below that, it's gotta be PLG. How do you advise founders on that?
00:16:36 · Carles Reina
[00:16:36] S0: I think it needs to be at least $1,000 a month, right? The trick is how much money do you feel that you can put in your credit card without having to explain anything? If you are comfortable putting $1,000 a month, absolutely fine, then your threshold should be $2,000 right? But if the majority of people putting $1,000 on their credit cards, even if it's for a business transaction, they still need to explain quite a lot of stuff. So then that's the moment in which they need handholding, they need convincing, they need to show ROI. That's the one that you want to tackle them because then you treat it as like a PLG motion with a land and expand. It's like, Don't worry. We'll sort everything. We'll help you. Dollars 12,000. It is a lot of money. Acknowledge that it is a lot of money for them because it is a lot of money. Then work with them on an expansion plan. But if you do it much higher, then I see a lot of founders telling me like, No, no, needs to be like investors have been telling me, I need to go proper enterprise. Proper enterprise, 6 figure deals and so on. I'm almost like, Forget about it. It's gonna take you months to get that contract done. The beautiful sight is if you sign a $12,000 contract, there is probably one layer of approval. Maximum two layers of approval for a bigger company. If you wanna sign a 6 figure deal, can this be like at least three or four layers of approval. If you wanna sign a million dollar contract out of the gate, it's gonna take you a long time. But if you actually land in a very, like, small deal, then you start expanding it, those approvals have disappeared completely.