The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
00:31:54 · Harry Stebbings, Adarsh Hiremath
[00:31:54] S1: How do you think about the future of remote and remote versus in person? I don't think you can do nine nine six and do it effectively unless you're in person. I think that motivation, that intensity, you feel in the same room. [00:32:08] S0: Yep. And that's exactly why we do, you know, in person in San Francisco. Brendan Surrey and I all get super energized by being around people. A lot of our best ideas from Recore have come when we weren't even in a meeting. Right? We were just sitting around, chilling, discussing things, and then you have that moment. And I think there's something really, really special for in person. [00:32:27] S1: What was the worst product decision you made? [00:32:30] S0: At one point, Brendan, Suri, and I all thought that chat was the future of all UI. So one of the initial iterations of the Merkur product was just built around a chat interface. Like, there was no other way to hire people unless you use the Merkur chatbot because we were so bullish on chat. I think we've come around to that. We now, like, mix chat with with other things, where applicable or leverage LLMs in other ways. But for a while, we thought, like, the concept of a web app tomorrow would be dead, and the way you would interface with all web apps would just exclusively be with chat. So it wouldn't even be, you know, you clicking a button to hire someone. It would be you telling the chatbot to hire the person. I think, you know, it's possible down the line, but we may have mistimed a little bit.
00:32:30 · Adarsh Hiremath, Harry Stebbings
[00:32:30] S0: At one point, Brendan, Suri, and I all thought that chat was the future of all UI. So one of the initial iterations of the Merkur product was just built around a chat interface. Like, there was no other way to hire people unless you use the Merkur chatbot because we were so bullish on chat. I think we've come around to that. We now, like, mix chat with with other things, where applicable or leverage LLMs in other ways. But for a while, we thought, like, the concept of a web app tomorrow would be dead, and the way you would interface with all web apps would just exclusively be with chat. So it wouldn't even be, you know, you clicking a button to hire someone. It would be you telling the chatbot to hire the person. I think, you know, it's possible down the line, but we may have mistimed a little bit. [00:33:13] S1: In terms of funding, dude, you've got some of the best on your cap table. You mentioned GC at the start. Talk to me. You've raised quite a few rounds in quite quick succession. How did you think about that? And do you agree when the money's on the table to take it? [00:33:27] S0: An interesting dynamic about of all of our, you know, fundraising rounds is just that, like, we didn't intend on on doing the fundraising at the time, and it sort of just came to us. You know, going back to the example about Benchmark, someone introduced Brendan to Victor. Brendan said we were heads down, and then Victor, you know, convinced Brendan to to have a conversation with him, and then the rest was history from there.
00:33:27 · Adarsh Hiremath, Harry Stebbings
[00:33:27] S0: An interesting dynamic about of all of our, you know, fundraising rounds is just that, like, we didn't intend on on doing the fundraising at the time, and it sort of just came to us. You know, going back to the example about Benchmark, someone introduced Brendan to Victor. Brendan said we were heads down, and then Victor, you know, convinced Brendan to to have a conversation with him, and then the rest was history from there. [00:33:53] S1: How did that process go down? So Brandon meets Victor, and then you guys meet Victor, and you have a chat. How does that get down? [00:34:00] S0: The way it went down was Brendan had the initial chat with with Victor. And then, you know, afterwards, Brendan was like, okay. Gonna gonna get back to work. Afterwards, Victor asked Brendan if he'd ever been on a helicopter. And Brendan said, no. Before you knew it, Brendan was on a helicopter with Peter Fenton from Benchmark, and we knew that they were the firm that we wanted to work with very, very quickly. [00:34:22] S1: And so Brendan comes back and goes, hey, guys. They took me on the helicopter. Let's do it. [00:34:27] S0: Had a couple more conversations with with Victor and the Benchmark team, and it was clear that they were they were the best. We wanted to be in business with them and and work with them, and they've just been phenomenal. [00:34:37] S1: Then how many months later is the next round? [00:34:40] S0: The next round is about over... About six months later.
00:34:40 · Adarsh Hiremath, Harry Stebbings
[00:34:40] S0: The next round is about over... About six months later. [00:34:45] S1: Six months later. You don't need the money at that point. Talk to me about that round. How did you think about taking the money then? [00:34:51] S0: It's interesting because we we, again, weren't focused on on fundraising. Right? We had built a a business that was doing a lot in revenue. You know, we're paying out tens of millions to [00:35:02] S1: How much is it doing in revenue at this point? [00:35:04] S0: 8 figures in in revenue. Right? And we were we were just like, let's be heads down. But just like we we felt with Benchmark, we we wanted to be, you know, in business with Sandeep and Felisa's and and the amazing team there, which made it a no brainer. [00:35:18] S1: Do you enjoy fundraising? [00:35:20] S0: Not really. Not really. Yeah. [00:35:24] S1: Do you have a board, Adash? [00:35:27] S0: We do. It's it's, you know, Brendan, Suri, and I and and Benchmark on the board. Is [00:35:31] S1: that it? [00:35:32] S0: That's it. Yeah. And, yeah, we we don't enjoy fundraising. I think the thing that we really, really enjoy is moving the business forward. That... That's always the thing that that founders enjoy the most. So we've been, you know, laser focused on that, and sometimes it just makes sense to to do the rounds. [00:35:48] S1: You said about 8 figures in revenue there when... I think you raised that one of the rounds. Were you aware of how fast the revenue scaling was? Like, were you guys looking at each other going, this is unbelievable?
00:35:48 · Harry Stebbings, Adarsh Hiremath
[00:35:48] S1: You said about 8 figures in revenue there when... I think you raised that one of the rounds. Were you aware of how fast the revenue scaling was? Like, were you guys looking at each other going, this is unbelievable? [00:36:00] S0: We definitely had that moment. At the time we raised that round, we didn't realize how much the growth was gonna accelerate. We knew of it. We were confident in it, but just the fact that it even exceeded our expectations, you know, wrapping up q one of of this year, is something that we're we're all, you know, really, really excited by. And talk to [00:36:20] S1: me about this new fundraise. Because this new fundraise is the Felices round. [00:36:23] S0: Yep. So the new fundraise was led by by Felices with, you know, other amazing investors, including GC, Benchmark, and others participating as well. [00:36:33] S1: And how much was this round? [00:36:34] S0: The round is a 100,000,000. [00:36:36] S1: And the price was? [00:36:37] S0: It was at 2,000,000,000. [00:36:39] S1: Yeah. What a phenomenal round, dude. Like, no, really, like, it's brilliant round. In terms of dilution, you dilute 5%, you get a 100,000,000 on the balance sheet. Phenomenal round for a company to do. [00:36:50] S0: Thank you. Yeah. We're we're really, really excited to be in partnership with Sandeep and the Felicis team. They're they're amazing. [00:36:57] S1: Do you need the money? Like, what are you gonna spend a 100,000,000 on? You guys make a load of money. You you got raised not long ago. What are you gonna do with a 100,000,000?
00:36:57 · Harry Stebbings, Adarsh Hiremath
[00:36:57] S1: Do you need the money? Like, what are you gonna spend a 100,000,000 on? You guys make a load of money. You you got raised not long ago. What are you gonna do with a 100,000,000? [00:37:07] S0: I think it gets really dangerous when people raise the money and then think that they just have to spend it immediately because they raised the money. Our goal isn't to deploy a $100,000,000 tomorrow. But Harry, I think the thing about our business is that labor aggregation and building this unified labor market, it's gonna take a long time. We just wanna make sure that we have a balance sheet that is kind of commensurate with that long term. [00:37:30] S1: Listen, I wanna do a quick fire round. So I say a short statement. You give me your immediate thoughts. Does that sound okay? [00:37:35] S0: Let's do it. [00:37:36] S1: Dude, what do you believe the most around you disbelieve? [00:37:39] S0: I think being a recruiter is the highest prestige position in any company. The recruiter is the one who controls the talent inflows and outflows of every company. Pretty much you can gather all you need to know about a company from seeing the talent inflows and outflows. The recruiting function of a company is the most underrated and undervalued. [00:37:58] S1: Does the whole we should do more with less efficiency on a per human basis, not go against McCorr and the importance of recruiters?