Starting a new business is no easy feat, and it takes a special kind of person to have the drive, determination, and resilience to turn an idea into a successful enterprise. Recent immigrants, in particular, often possess many of the key qualities that make for great startup founders, and their unique experiences and perspectives can be invaluable assets in the fast-paced world of entrepreneurship.

One of the biggest advantages that recent immigrants have when it comes to starting a business is their willingness to take risks. Immigrating to a new country can be a daunting experience, and it requires a certain level of bravery and adaptability. These same qualities can serve recent immigrants well when it comes to starting a new venture, as they are more likely to be open to trying new things and willing to take calculated risks in pursuit of their goals.

Recent immigrants also often bring with them a strong work ethic and a determination to succeed. Many immigrants leave their home countries in search of greater opportunities, and they often have to work hard and overcome numerous challenges in order to make a new life for themselves in their adopted country. This same drive and determination can be incredibly valuable in the competitive world of startups, where long hours and hard work are often required to get a business off the ground.

In addition to these personal qualities, recent immigrants also often bring valuable cultural and linguistic skills to the table. As the world is now interconnected, with clients and partners often in multiple geographical locations, businesses that are able to operate effectively in multiple languages and cultures can have a significant advantage. Recent immigrants have firsthand experience navigating different cultures and societies, and they may be able to bring valuable insights and connections to their ventures as a result.

Finally, recent immigrants may be more open to trying new approaches and ideas, as they may not be as tied to traditional ways of doing things. This can be particularly valuable in the fast-changing world of startups, where the ability to think creatively and try new approaches can be the key to success.

In conclusion, recent immigrants can make great startup founders due to their willingness to take risks, strong work ethic, cultural and linguistic skills, and openness to new ideas. Their unique experiences and perspectives can be invaluable assets in the world of entrepreneurship, and they should be celebrated and supported as they pursue their dreams of starting and growing successful businesses.

Why recent immigrants make great startup founders was originally published in Badhouse Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.

Despite the inventiveness that permeates the world of tech startups, the fundraising roadmap dispensed to founders just starting out has not changed much over the last few decades. That’s a problem, and not just for startup founders, but for early-stage angels and VC firms.

Fundraising is seen as a pipeline.

All advice material meant for startup founders, from the last couple of decades, chart the fundraising steps as “love money / friends & family” → “angel investor(s)” → “Pre-Seed” (though rarely cited until more recent years) → “Seed”, “Series A”, etc.

A startup journey is rarely a straight line; even non-tech entrepreneurs are keenly aware of this. Fundraising is part of that non-linear adventure, a roller-coaster even, so models and advice are just guidelines. However, one thing is pretty clear: Unless you have a very large bank account (maybe from an inheritance, or a past startup exit), there will be a need for outside capital. [While certain startups, especially software-only ventures, can bootstrap their way, the vast majority will need to seek additional investment.] Just like a real fair ride, not everyone can get on. That first gate, a first investment, is that ticket to get onboard. But in many cases, despite doing everything right — making a strong case for the vision and the founder-product fit, validating the opportunity through research and/or a rudimentary prototype, demonstrating commitment, skin in the game, etc. — a friends & family round is rarely going to be possible given one’s family background, geographic region, previous occupation, or all of the above.

Despite a lot of love, the money may be absent.

Not everyone has wealthy friends or family. So, what happens when raising funds from one’s entourage is not possible?

• ⏰ Missed opportunities: Slower progress, potentially by continuing to work at a regular job full-time (or trying to work two jobs to accumulate savings to invest in the business) and advancing on the startup part-time. 🏃‍♀️ One of the largest advantages of startups is the ability to move fast; working part-time is a huge headwind, slowing things down so much that opportune market timing could be missed.
• ⌛️ Time wasted: Filling out tortuously long grant applications in hopes the square peg of the startup venture fits in the round gate of the funding agency’s requirements. This is rarely a solution as in many jurisdictions grants are doled out on a matching cash basis or on a refund basis, meaning that one still needs to somehow have money upfront!
• 😰 Founder fatigue: Being a startup founder requires a lot of energy and perseverance, but without that early financial and confidence boost that comes from a friends & family round, stress is amplified, escalating the likelihood of burnout, and giving up on a potentially successful venture.
• 🛑 Premature end: In some cases, there are no other options. Without the presence of patient love money, a venture will have to stop dead in its tracks.

Founders whose entourage doesn’t permit for a friends & family raise are clearly at a big disadvantage! They’re often unable to get their business off the ground, let alone be able to perform tests, adapt, and grow their business as quickly.

A friends & family round: Signal or noise?

I’ve listened in on many founders pitching angels and early-stage VCs, both in private and in public, at pitch events I’ve organized. I’ve also had numerous pre-investment analysis and diligence discussions with potential co-investors considering participating in the Pre-Seed round of various startups. In a high proportion of these interactions, there’s a noticeable sense of comfort when it’s discovered that there’s been a prior friends & family round. It’s normal, knowing there’s been some prior investment, even if it’s not smart money, is somewhat reassuring; it’s human nature not to want to go into a dark tunnel first.

Though love money is not explicitly a requirement for angel investors and “early-stage” VC firms, it is a source of judgment if absent; questions might come to mind as to the capability of the founder at pitching and selling the vision of the venture. There’s a chance these seeds of doubt could lead to passing on investing. That’s unfortunate, as the mere fact of having had a successful friends & family round might simply indicate a founder’s privileged background, rather than anything pertinent about the startup’s potential future success.

This surely limits diversity downstream.

It is well known that, collectively, the population of successful startup founders lacks diversity. Could it be that this lack of diversity is aggravated, if not originated, with the situational luck of privilege that facilitated a friends & family round in the earliest days of those startups? Sadly, the magnitude of the problem has not been rigorously quantified (I was not able to find any study of the socioeconomic diversity of friends & family-funded founders), but it seems like the venture funding system, as it is now, is heavily skewed to support those with well-to-do, well-educated families and the social circles that come with that.

Putting aside the moral implications, one must ask if, both as investors and as a society, we’re potentially missing out on world-changing, impactful startups?

Solutions?

I don’t claim to have “the” answer, but the unmerited disparity in access to friends & family startup fundraising should certainly be alleviated by an increase in risk-tolerant external investors, investing at the very earliest stages of a startup’s life. There is potentially a great opportunity to invest in previously overlooked ventures, where a friends & family round just wasn’t possible.

About me: I’m the founder of Badhouse Ventures, a nano-VC firm in Vancouver with a concentration on the very early stages of startup development (aiming to invest first in software-focused ventures), combined with a geographical focus on Western Canada. A central thesis of Badhouse is that the existence of an active institutional investor, investing earlier in startups compared to other investors in a region, should contribute to increasing the socioeconomic diversity of funded startup founders.

The “friends & family” chasm in the startup funding journey was originally published in Badhouse Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.

We have high conviction in the opportunity, but the story starts with the founders. We first met the initial founder, based in Calgary, Alberta, when he participated in a Badhouse Pitch+Learn event last year, pitching a completely different startup. OK, not quite completely different, as it still involved the creative collection of data for health & wellness promotion, but it was for pets! To make a long story short, we kept in touch as he pivoted to human health, joined forces with a co-founder (currently based in NY), participated in a blockchain-focused acceleration program, and grew a huge community of engaged beta testers at lightning speed. Each check-in chat was always full of news of scrappy progress, in parallel to credible evidence of a real market opportunity.

Forever Today is surfing on multiple trends: the quantified self movement, the rise of play-to-earn games, the use of NFTs for creating alternate digital identities (such as PFPs or avatars in a metaverse), the proliferation of connected wearable devices, and the use of apps providing personalized, often AI/ML-powered, health promotion recommendations. Broadly speaking, the company is building a web3 ecosystem for personal health data, gamifying wellness using NFT and metaverse technology stacks.

For the Forever team, Step 1 was building a competition platform pitting teams from different cities to walk the most over a period of one month. You might have heard of a big “Miami vs New York” steps competition this spring; it was this team’s clever idea to onboard a large number of early users very quickly.

Step 2 has been the release, just earlier this week, of a dynamic “Mebot” NFT that’s a bit like the old Tamagotchi toy from the mid-90s, except that now the creature’s characteristics and health is a reflection of the owner’s health, as it is affected by the health data aggregated by your mobile device (e.g., Apple Health on iOS devices), starting quite simply with steps walked, heart rate variability, and sleep time. Pretty cool way to promote healthier habits, don’t you think? It’s what is typically in industrial contexts called a “digital twin”. It’s also a nice way to make this web3 initiative less attractive to speculators with no long term interest in the ecosystem; having a large collection of Mebots won’t do you any good, as you won’t easily be able to maintain multiple ones in health in hopes to resell them one day.

Upcoming on the roadmap is to allow the Mebots to interact in a metaverse environment, as well as adding in support for other health-related data sources.

And this is only the tip of the iceberg… The Forever product roadmap includes adding personalized recommendations (all the while ensuring individual privacy), wide-scale anonymous health research opportunities that could remunerate participants, and potentially much more. The ambitions of this startup certainly fit into both the Badhouse investment themes of “smarter communities” and “smarter data systems”! Unlike many other web3 and metaverse-related ventures that have started in the last year, the use cases are real, representing challenges that can’t easily be addressed using centralized web2 technology stacks.

We’re anxious to see the next developments, and bullish for this and other ventures that are connecting the virtual world to the real world. For now, we’ll be going outside and walking a bit more to ensure that our Mebots “hatch” in the best conditions.

A new addition to the Badhouse portfolio: Forever Today was originally published in Badhouse Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.

Meet the 4th, 5th, and 6th early-stage startups in the Badhouse portfolio

• Bandit Labs: Bandit is an AI and conversational analytics startup that has its roots at the University of British Columbia with a team of Natural Language Processing (NLP) researchers and engineers. Unlike other Badhouse investments so far, the connection was initially made because co-founders Chantelle and Patrick had applied to pitch at one of the Badhouse Pitch+Learn events (Chantelle ended up being both the audience and the guest investor jury’s choice for best pitch at the November event!). 👉 The opportunity 💡: In addition to helping to improve the performance of customer support teams, one of the main use cases for the Bandit Labs platform is giving product teams additional visibility on the customer experience via smart reporting on customer support interactions. As a former startup product manager, support teams were often my ears to the ground, but the information passed on was generally anecdotal and hard to integrate into roadmap priorities; with Bandit Labs, product and UX teams can now get quantitative, actionable reporting.
• BlockSurvey: BlockSurvey is privacy-protecting form and survey SaaS taking advantage of the Bitcoin blockchain technology stack. And it’s not just the product that’s based on decentralized systems, the team itself is decentralized, with collaborators and first users distributed globally from day 1, as is increasingly the case with many web3-first startups. The relationship with one of BlockSurvey’s co-founders, Wilson, started while he was participating in the Stacks Accelerator’s first cohort. 👉 The opportunity 💡: Unlike products like Typeform, SurveyMonkey, and others, BlockSurvey has zero visibility on the questions you ask your target audience, nor the data from their responses, as they are end-to-end encrypted. This privacy and data security by default should be the norm, but is especially important when collecting sensitive data, such as in the areas of mental health, sexual health, or social and political activism. In addition, survey respondents can, if they wish, build up a secure “wallet” of their answers to be re-used in other applications in the future, in a permissioned manner.
• Trunkit: Trunkit is a collaborative transport marketplace matching individuals & businesses who need to move/deliver items between cities and drivers who have already planned, compatible trips. The makeup of this startup’s founding team breaks the mold by being intergenerational. Though it’s still very early days for Trunkit, they’ve already had an impact on their home region of the Lower Mainland of British Columbia, with their platform facilitating the moving of equipment and goods during the multiple inclement weather events in the last couple of months of 2021. 👉 The opportunity 💡: In a similar fashion that carpooling reduces the number of vehicles on the road by increasing the number of passengers, Trunkit has the potential to reduce vehicles further by optimizing the use of empty car trunks, pickup truck cargo beds, and deadheading commercial vans.

The 2022 roadmap

Now supporting 6 portfolio ventures working towards product-market fit and revenue traction to attract next-round VC investment, 2022 will also be a year of continuing to pool together the resources of the growing Badhouse network of investors and supporters.

Are you the founder of a ridiculously early-stage software/web3 startup?

Are you at the stage where your alpha-version is still a bit embarrassing? 🙈 Have you pitched to self-described pre-seed/early-stage VCs and angels who say that your startup is “too early” for them? Those are signs that we need to talk, especially if you’re working on an opportunity that’s in one of the problem spaces listed at the bottom of the Badhouse website! Share us the details here → https://badhouse.ca/apply (Warning, it’s a relatively long form.) Do know that the Badhouse investment thesis is presently heavily focused on investing in founders with some link to Western Canada, but that could include a plan to immigrate here or grow part of your future team here!

3 new Badhouse Ventures investments was originally published in Badhouse Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.

Two startups in our Badhouse portfolio have commercialized SaaS applications quite germane to the post-pandemic “new normal”: Aboard (HR / Remote work / Future of Work) and ioAirFlow (Proptech / Cleantech). As part of an investor-focused event held in mid-November 2021, I had a chat with co-founders from each team — Evan Hallward @ Aboard, Matt Schaubroeck @ ioAirFlow — to discuss recruiting employees and keeping employees happy. Listen to the 10-min segment below.

Badhouse Pre-Seed Portfolio Spotlight — Aboard & ioAirFlow: “Keeping employees happy” was originally published in Badhouse Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.

Brief history of an ongoing story

It’s a long and winding road raising a VC fund. Doubly so for a first fund. Even more so as a first-time fund manager. It’s no surprise then that the last year has been quite an interesting one! Pandemic be damned, Badhouse Ventures was legally born the same week that Canadian workers were urged to stay home if possible, and its first bank account opened the last day before most branches temporarily stopped allowing walk-in meetings.

Since that time, what started as a crazy notion — that there’s an opportunity for a new hands-on VC writing cheques ridiculously early for software-powered startups with a “West of Toronto” 🇨🇦 centre of gravity — has evolved a good deal in form, but not in spirit. Most notably, the anticipated model originally involved having a physical space, somewhat like an incubator; thank goodness that part of the plan was quickly scrapped. The focus remains squarely on helping founders fill the gap from a beta-version product to a VC-led Seed or early Series A funding round.

The past year and a bit has been centred on people: E-meeting wise souls who’ve started VC funds for advice, potential investors in the first Badhouse fund (aka LPs), larger “next” investors (typically Seed and Series A VCs), supporters of entrepreneurship in various communities, and, of course, plenty of early-stage startup founders.

One of the best forums for bringing folks together turned out to be the Badhouse “Pitch+Learn” series of events (badhouse.ca/pitch). These events provided pitching founders extra visibility to new investors, as well as useful feedback. Of all our event winners, nearly half have successfully fundraised a first external round within a few months after their respective event. Founder-judge interactions at each event has also been particularly educational for soon-to-be founders watching in the virtual audience.

As time went on, we met some potential LPs who were as enthused as we were to get started sooner, rather than later, and making some pre-fund investments with Badhouse. Which brings us to today’s topic!

Meet the first 3 ventures in the Badhouse portfolio

In the quarter that just ended (Q2 2021), we invested in three remarkable early-stage startups that align well with our dual investment themes of “smarter communities” and “smarter data systems”:

• Supportbench: An enterprise-focused customer support CRM built for companies with high-touch, high-value customers, and complex product offerings. 👉 What we ❤️: A well-balanced team that’s accomplished a lot with limited outside investment previously. They’ve lived their customers’ pain points and are passionate about the problem space.
• Aboard: A SaaS solution facilitating the planning and execution of engaging, multi-step employee journeys, especially well-suited for remote employee onboarding. 👉 What we ❤️: A geographically distributed team that eats its own dog food. We’re entering a period of increased worker churn across various industries and anything that can help companies reduce the time from onboarding to optimal productivity for new hires will be immensely valuable.
• ioAirFlow: A suite of data analytics solutions to diagnose energy efficiency and indoor air quality in commercial buildings. 👉 What we ❤️: A tenacious team away from the distractions of a large tech hub that’s been plugging away building up their product offering. They’re enabling the digital transformation of energy auditing, and with all the older commercial buildings requiring retrofits to meet climate targets, there’s plenty of growth ahead.

The road ahead

We’re already rolling up our sleeves to support these three companies and quite delighted to be doing so! The Badhouse modus operandi involves pooling the resources of our growing network of supporters and partners to help portfolio ventures figure things out strategically, to set a good operational foundation as they work towards product-market fit and revenue traction to attract next-round VC investment.

In parallel, we’re meeting an increasing volume of early-stage founders that are now coming to Badhouse by word of mouth and founder introductions. It’s been noted in the US that former founders and operators (the make-up of the Badhouse brain trust) typically see startup deals 9+ months before more traditional investors do. When founders are refining a concept, preparing to release a first beta-version, or figuring out pricing, they typically don’t call VCs for guidance. They call startup folks who’ve likely had similar experiences.

Get in touch.

Badhouse has started making investments! was originally published in Badhouse Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.

Since starting our operations as a nano VC, we’ve seen a lot of early-stage startup pitches; even more so as we’ve been running open-call virtual pitch events since the beginning of the global Covid pandemic (see badhouse.ca/pitch): Some have stood out, many have been OK, and in full honesty, some pitches we’ve seen have been downright terrible. Fortunately, being good at pitching is not a gift, but something one can improve with practice. (I’m quite thankful for that, back when founding my first startup, my early attempts to pitch were quite dreadful. Gladly, I’ve improved a bit since then, leading to getting buy-in from various investors, customers, and team members over the last decade.)

A good pitch is a combination of appropriate content and good delivery. It’s also crucial to adapt to the anticipated audience (potential investors? potential customers?) as well as to the context and medium of delivery. I’m focusing here on pitches delivered live, whether in person or online.

There’s plenty of good content out there, just a Google search away, about what startup pitches should contain in different contexts, whether the short elevator pitch or the longer format pitch, from topics to cover (problem, solution, market, team, etc.) to slide order and slide counts. I’m not going to reproduce these here. In fact, take all that published advice with a grain of salt, as there’s no magic formula ensuring 100% success (e.g., closing the sale, getting the investment) in how to tell the story of your startup, despite what some experts may claim!

Instead of diving into preparing your pitch as if it were a formulaic exercise, I’d argue it’s much better to start by taking a step back, thinking of the bigger picture, to consider the primordial issue of how to convince your audience. That’s what pitching is about after all: Convincing! In doing so, your mindset will be different. Instead of cranking out a perfect slide deck and practicing its delivery, you’ll be envisioning how to get to a “yes” given the time constraints of the format, and, at the very bare minimum, how for it not to be so awful as to leave a bad impression with the audience!

Let’s start with that very low bar — how not to stink… What makes a healthy pitch? Though I’ve refined my own pitching competence over the years, to answer this question, I asked a much more seasoned expert: Christoph Sollich, aka “The Pitch Doctor”, who’s coached more than 2000 entrepreneurs over the last decade. Christoph graciously accepted to be our guest speaker at the last Badhouse Pitch+Learn event. We recorded his presentation, which you’ll find below.

In summary, the 5 “pills” to a healthy pitch:

• Realize how people react to pitches.
• Answer the 5 big questions: Why? Why you? Why now? Economic engine? Any proof?
• Search for the holy grail: Precision.
• You’re not Brad Pitch. (Pitching ≠ Acting)
• It ain’t PowerPoint’s fault if your pitch sucks.

Hope you find this helpful! Let us know your thoughts on Twitter.

💊 5 pills for a healthy startup pitch was originally published in Badhouse Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.

We just held our latest virtual “pitch+learn” event where we showcase a small selection of very early-stage software startups (alpha-version product, generally only limited/early revenue) from a backlog of spontaneous submissions, as well as sourced by the Badhouse team. Today’s theme was, very broadly, applications of AI. We heard from founders about products ranging from a system for AI-assisted content marketing, to AI to help home builders optimize between cost and energy efficiency, a chatbot for employee engagement, and machine vision for tracking eggs. (Yes, 🥚!)

Post pitches, during judge deliberation, we welcomed guest speaker Annika Lewis (from Vanedge Capital, a VC firm based in our hometown of Vancouver, Canada). Annika covered a topic that’s front of mind for most startup founders once they start to get some early validation (first users, first paid customers, etc.): How to plan for a seed fundraising found? What sort of things should one measure and how to argue “traction”? Our live audience requested to have access to the slides and so, with the speaker’s gracious permission, here there are below!

👉 Join our announcement list to be notified of future Badhouse pitch+learn events: events.badhouse.ca/participate (You’ll also find on that page a link to the form to be added to the backlog to be considered to pitch.)

Preparing to raise a seed round? was originally published in Badhouse Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.

Last month, for our June 2020 edition of the Badhouse Ventures “Provocative Startup Stories” pitch+learn event series, we focused on the themes of B2C and social. The finalists pitching were showcasing alpha-stage products ranging from a matchmaking site to connect female apprentices with mentors, a next-generation service looking to disrupt Meetup, a social game discovery platform, and a hybrid Instagram-TikTok app helping anyone become a micro-influencer and connect with local businesses for paid gigs.

For the “learning” portion of the evening (held while the judges were deliberating on the pitch winner), we invited our friend Benjamin Watson to share some of the marketing wisdom he’s accumulated from his time as a product marketing leader at Hootsuite, Yahoo, and Microsoft. Here’s the recording of his talk and the subsequent Q&A.

Making early-stage startup marketing more awesome was originally published in Badhouse Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.

Since the early days of the COVID-19 pandemic we’ve been running online pitch events for early-stage startups, striving to combine interesting software-focused startups with experienced judges (e.g., ex-founders, like Eric Ly, co-founder of LinkedIn, VCs from around the world, angel investors in North America, and corporate innovation leaders). To fill the time while judges go offline to deliberate on a session's winner, we hold an informal learning session, led by a different subject-matter expert each time, on a topic of interest to most early-stage startup founders and investors.

For our May 2020 event, we invited a partner at the international law firm of DLA Piper, Michael Reid, to give the audience the good, bad, and ugly on SAFEs — the so-called Simple Agreement for Future Equity created by Y Combinator in 2013 as an alternative to convertible debt. The SAFE was designed to be a standard template that’s quick to execute. As a result, it’s become a very common way through which early-stage startup founders raise their first funding from angels or investing-accelerators.

To get an understanding of how SAFEs work, we encourage you to take a look at the super educational document that Michael’s team has created stemming from the presentation he gave to the Badhouse community: https://www.dlapiper.com/en/canada/insights/publications/2020/07/demystifying-safes [Link updated 2020.07.30]

Demystifying SAFEs was originally published in Badhouse Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.