Being The Pattern (Stax)

By Jason Yeh
November 17, 2022
Listen on Apple Podcasts

Being The Pattern (Stax)

As a first-time founder and fundraiser, finding a guide is crucial. Typically, you seek successful founders or companies in your industry with similar backgrounds and visions to emulate. But what if you're entering uncharted territory with no models to follow? This was the predicament faced by Suneera Madhani, CEO and founder of Stax. Despite lacking a guide, patterns, or representation, Suneera, driven by her solution-oriented upbringing, forged her own path. In this episode, Suneera recounts the challenges she encountered, including the need to raise funds and navigate the venture world without prior experience, ultimately leading her billion-dollar company, Stax.

Episode Summary

As a first-time founder and fundraiser, finding a guide is crucial. Typically, you seek successful founders or companies in your industry with similar backgrounds and visions to emulate. But what if you're entering uncharted territory with no models to follow? This was the predicament faced by Suneera Madhani, CEO and founder of Stax. Despite lacking a guide, patterns, or representation, Suneera, driven by her solution-oriented upbringing, forged her own path. In this episode, Suneera recounts the challenges she encountered, including the need to raise funds and navigate the venture world without prior experience, ultimately leading her billion-dollar company, Stax.

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Episode Transcript


Suneera: I remember them like, like slipping over the Manila folder to me.

and I literally look at it and just tears start falling on my face.

and I just say like, thank you. And the number has to be higher and I slip back them


This is funded a show where founders who raised millions in venture capital share the gritty side of what it actually took to get that money in the bank.

I'm Jason Yeh. Not too long ago. I was trying to get my ideas funded. And back in the day, I was a VC listening to founders, pitch me for money.

The surest way to get backed by a VC is to match a stellar pattern. Like having a successful track record of launching high growth startups or the right credentials, like graduating from Y Combinator or being an early employee at a unicorn. We call this [00:01:00] pattern matching in fundraising lingo. But it's really just a fancy way to explain something. We all intuitively know.

Unless you're dealing with a major risk taker. The easiest way to convince someone is to show them. You're like someone they've seen who succeeded before. But what do you do if you've never done something like this before? Or maybe have all the passion in the world. But don't look like someone who VCs would expect to launch the next Stripe or Figma. ,

Meet scenario. Madani the millennial who just let her FinTech startups stacks to unicorn status. They just closed on a $245 million round. This spring setting a pattern for a whole new generation of founders. Because as it stands. Research shows that in fundraising, less than a percent goes through companies led by women of color.

And that's not the only pattern scenario as a first-generation American breaks. She also raised [00:02:00] one round while pregnant. Something, even a few of her closest mentors told her to hide. And was adamant that she wouldn't budge from her HQ in Orlando, Florida. But it turns out her parents set the pattern for her.

Opening a series of stores and restaurants. That were highly influential in her upbringing. Which is where we jumped into our conversation.

Jason: so just wanna get started. One of the places that we start, with these conversations is just hearing a little bit about what you were like growing up. And Stax is interesting because you actually founded it with your brother. So wondered if you could tell us a little bit about

what you and Sal were like as kids. Um, one of the things that I think is really helpful for founders is sometimes they believe that there's like one archetype for a founder that might be really difficult for them to match their [00:03:00] engineers out there, their minorities, their women. And when they see this one hard charging kind of prototype or archetype for a founder, that's what they think they have to be.

And they can't always be that. you are. Not white or a man. So, and you, you, co-founded the company with your brother. So I would love to hear a little bit about you and Sal growing up and we'll go from there.

Suneera: Jason. Thanks, actually for asking that because that's one of the biggest things that I'm a huge proponent of is demystifying what a CEO or what a founder looks like, because there really is no such thing. And I will tell you, I'm sure we're gonna get to all my crazy fundraising experience, but I used to also try to fit into a box that I didn't belong.

And it wasn't until I finally owned my authentic CEO that the company really took off. So I really appreciate you starting us out here because there isn't a perfect, archetype of a person. And I think that that's what also needs to change in the VC world. I'm a huge proponent of like women [00:04:00] in, in business and women, you know, less than 3% of venture funding goes to women less than 1% to minorities.

And so, uh, I think that there, there is unfortunate, a biased archetype. But there, there isn't an archetype for founders. What's the bias is who's getting the venture funding, so I'm sure we'll get there, but I agree with you on this. So a little bit about my background. Um, and I think it's super important to start there.

Yes, I did co-found a company with my brother. I started the company and then he came in just shortly thereafter. I was in the payment card industry. So I was the one that kind of had the experience in payments. but Sal was the one that had aton of, you know, startup venture experience. So it was this perfect blend of two completely different, uh, experiences that we had in our professional growth.

So it was just a, a natural partnership. And then who better to do it than somebody who trusts, you know, like your family. And so, and my brother, so, uh, we grew up in an immigrant household, so my parents. are Pakistani. They immigrated here separately from Karachi, Pakistan. They met in Chicago. I was born in [00:05:00] Chicago.

Then we moved to Dallas where my brother was born and we kind of grew up in this, um, entrepreneurial household naturally, because for them, entrepreneurship was a necessity, not a, uh, it wasn't sexy. Right. They didn't have it a college education.

And so for them to get the American dream, which was to make sure that my brother and I got a college degree, like that was the American dream for them, that they didn't have to become, like we didn't have to become entrepreneurs.

So it's crazy how our story, like we're now both they're both, their kids are entrepreneurs. Um, but we learned everything from our parents. I mean, I, I wouldn't change the thing about. growing up in, you know, I wouldn't say like crazy adversity, you know, we were middle class and, uh, we, had a ton of, you know, just so much abundance as a family of family time and family dinners.

And, you know, as an immigrant kid, a lot of pressure on our studies and getting really good grades, helping out our parents at their stores. So we had a convenience store. Then we had like a pizza restaurant. We had all these different types of businesses [00:06:00] that my brother and I ended up, you know, we grew up in these businesses with our family

Jason: Yeah. Tell me a little bit about that little business, because I, I think that is very formative. Do you remember what you were asked to do and the things that you sort of built along the way in terms of personal development skills?

Suneera: yeah, I look back now and I'm like, oh my God, I was getting my MBA as like a seven year old without knowing it. Right. Like watching, watching my parents. You know, run a small business. And, you know, I remember, there was a memory actually shared with entrepreneur magazine last week. and it was on a video interview and I talked about like a vivid memory that I have as me stocking shelves.

And I was just, you know, like, Hanging out on the store, on the weekends. And then my dad would give us like odd tasks to do. And so one of my jobs was to line the cans up and then put the little sticker from the sticker gun onto cuz you didn't have point of sale systems at the time. And so you manually priced something on the sticker gun and then you put the stickers up.

So he would have like the price done for me. [00:07:00] And I had to place the little stickers on to this organized canned shelf. And one of my memories is he came back and he was. Okay, great job. However, like make sure that the labels are all pointed in the right direction. And if you're just gonna do it, don't do it quickly, like do it with quality and make sure that it's in the same spot.

And, oh, do you see that you there's dust here? So I know that wasn't part of the job that you were supposed to do. I told you to line the shelves of the, the cans up, but if you see that there's dust here, go grab a duster and then you can just dust it off. So it's so important of like doing things with quality and care and so,

things like that. Like I now look back and I'm like, oh my God, Jason. Like, those were these beautiful experiences that we had as children watching our parents work so hard. And that was it. That was the work ethic. That was the quality that was like the no job is better than like you were every hat as a small business owner.

And you know, it was all that quality down to like that simple can of [00:08:00] corn, you know, and that, that's kind of, that was how I, how we grew up. And so there is this unique, background that, you know, my brother and I shared, and there were, there were also setbacks from it, right? I mean, there was a lot of stress in the household, obviously financial instability from just entrepreneurship, bringing that home.

We went to 10 different schools in 12 years, like on the pursuit of all of these different businesses, we ended up moving to Florida. So people ask all the time why our company is here in Orlando. I was like, this is the last place I'm moving. This is the last place I moved. I moved here when I was 16 years old.

It was my third high school that I had come to. And I was like, I am not moving ever again. And. Honestly, that's how Stax ended up in Orlando, which is one of the best decisions that we made. but that's kind of a huge part of Sal and I's story growing up. And so, because we went to 10 different schools, we kind of only had each other.

So even though we were like annoyed, he was my younger brother and we definitely had our sibling moments, but at the end of the day, like all we had was each other too. And so we've always had this really. So, you know, [00:09:00] friendship, uh, and he was always my best friend growing up, cuz that's kind of like, that was home.

That was like the only piece of like home that I had was, was that. And so

we're really close and we get to, we get to do this together every day.

Jason: the, the trust between co-founders is so huge when it comes to starting a business from scratch and then scaling it. Um, I think that chemistry. Bleeds into fundraising and making sure that, um, investors see the team that is going to be running this company and, and knowing that it's like a two-headed monster that will actually tackle the things that need to be done.

Um, one other small line of, questioning around your, your upbringing. So incredible stories around just what you learned towards attention to detail, hard work, dealing with adversity and setback. These, these themes all sort of bleed into what it takes to raise money. I wonder if you were culturally or personally, just, wired to ask for things and, and ask for money.

And, and what would, what do you think it [00:10:00] felt like the first time you went fundraising relative to what you were like as a kid? was that a natural transition for you?

Suneera: I would say it was actually the opposite. I think asking for money was definitely something that, that was not some like that is, was not natural. So you worked hard for it yourself. Like you don't, you don't ask for things like you work hard for it. So I did grow up around like whatever the adversity is, whatever

no you get, you find a path through it. Um, and you don't just take no for the answer. There's another solution out there. So I grew up . In a very like solution oriented environment where there were lots of problems, but we tackled them with solution finding. On the asking for money aspect, I think that was the complete opposite.

And I think that we also, you don't see a lot of, um, like it wasn't an industry that we were ever familiar with. So even as. I went to university of Florida. I went to a great college. I got a degree in finance. I got a degree in marketing. You know, I didn't learn about venture until so much later in my life and in my career.

[00:11:00] So I wasn't exposed to what venture fundraising. Well, I wasn't exposed to even a concept that you could, get other people to invest in your business like that wasn't something that I even grew to know until later in my, you know, in my startup journey as well. And so it wasn't something that was . Natural, but the hard work portion and proving yourself portion.

That was a chip on my shoulder for.

Jason: so it's a great transition into what I want to ask you about, which is. You started the company, I think in 2014, from what I can tell online, um, given what you said just now about weren't even sure that there was an industry like venture capital that would fund early stage tech businesses. Did you start the company knowing that you would need some sort of.

Additional money outside capital or was it start a company? And then you started just getting pulled into this gravitational pull of venture capital one or the other?

Suneera: Yeah, it was, it was a ladder. I had no intention of raising venture capital. [00:12:00] Our company was just growing faster than we could keep up. And so I had, no, I, no desire or even an idea to go build a billion dollar business. I didn't even know I could go build a million dollar business, let alone a billion dollar business.

And so, and that's one of the huge re I think that representation matters so much. I never saw women, you know, starting and scaling companies at that level, less than 2% of female founders ever even break a million in revenue. Right. So seeing is a hundred percent believing and there's all these biases that we have ourselves naturally, just because we don't see people like us doing these things.

And so I didn't grow, I didn't see any of that. I wasn't exposed to any of that. I started, uh, Stax 2014. And, uh, you know, I was literally selling door to door at that point to go get small businesses onto our platform. I had no background in technology. Sal was working out in California for a startup. I was working in the payments industry when I had the idea of the first subscription based credit [00:13:00] card processor, which now seems like so natural, but in 2012, when that came about, there was nobody in the market

that was doing it. And I firsthand was experiencing what my industry was doing to small businesses. and I had that background. I knew that there had to be a better way. I pitched the idea back to my old bosses. There's plenty of podcasts on that, your listeners can go catch up on, but I got rejected and I was a reluctant entrepreneur.

I wanted to take this to my old company. I wasn't even trying to become an entrepreneur.

Jason: Oh, no way

Suneera: That's one part of this story

Jason: you were trying to help your old company and they're like, well, I guess if they're not gonna take it, I have to do it


Suneera: That's exactly how it went down. And, and then when I started doing it, we were signing up customers. I got, you know, I went to a venture accelerator, a tech accelerator, cause I wanted to build out the software component of our platform, not just the,flat subscription fees that we had.

And so I had to go get a technical co-founder and that's where I met my co-founder Jacque. Who's also become our other brothers, like what we call him. So we were like, like three-headed monster.[00:14:00] and so it's just been this incredible journey since 2014, but, you know, I didn't know that we were gonna need venture capital.

It was at a point when we couldn't keep up with the demands of our customers. We had about, I think it was at that time, 16,000 in MRR. So monthly recurring revenue on our platform and we're like, we need to go. We couldn't develop fast enough based on what our customer's needs were. We had already validated that we had a proven MVP.

We didn't even have a product. We were white labeling solutions pieced together for our customers. And then we had a viral article that went on fast company titled "meet the woman, trying to change their credit card industry" that we didn't know it was gonna go viral. So a lot of my story is like showing up every day for a job that's like bigger than the one I had yesterday.

And, and that's how it, that's how it all started. And now we're, you know, 23 billion in payments later.

Jason: Crazy, yada, yada yada moment there. And we'll, we'll

Suneera: yada, yada,

Jason: right, right. Small yada here and there. Uh, one thing [00:15:00] I just wanted to react to and, applaud you for is how much you've put yourself out there as a role model or something that other people, like you said can see, just believing that it's possible I mean, so much of just knowing what is possible. can really encourage people to, you know, take the step. Steph Curry started shooting three he's like five feet behind three point line. No one was doing that before. And once he did it, everyone started doing like little kids are practicing to the detriment of, of youth basketball.

But I, I would say that seeing someone like you Suneera, out and about, um, on magazine covers talking about the business you built is amazing. And I think the other thing, especially on a, a fundraising podcast to talk about is the path you took, which is. , you know, not feeling like you had to raise venture capital, but really that you wanted to just build a business.

Like you were just solving a problem. You, you wanted to build a thing that you believe needed to exist and you were willing and ready to do the things without capital and. Um, what I tell [00:16:00] people on a one-on-one basis all the time is that the best fundraising happens when you're like, you're not really looking for it.

It's like pulling it from you. It's like you have to, and people like want to give you money and want to invest in the opportunity. Too many founders, do it the other way around and believe because of tech crunch headlines and everything else, and the sexiness of startups nowadays, that the goal is to raise money and that's never the goal, right?

The goal is to build a great business solve problems and then find fuel for that fire.

Suneera: Absolutely. You, you said it really eloquently. It is a hundred percent now as an investor now. So I invest in startups now,

which is

so crazy to me.

Jason: Just paying it forward, right?

Suneera: Absolutely. But the founders that I wanna invest in are the ones that are building great business. When I was building a business, I was building a great business. Today,

I have an incredible business and every step of the way, I've always had an incredible business. And so, although there's a lot of adversity that we're gonna probably talk about in the fundraising process, I agree with you. I think some founders have it backwards and [00:17:00] that they almost use the lack of funding as an excuse to go build a business.

Go figure out how to get your customer, go figure out how to validate it. Go figure out how to get revenue. And then once you have more proof, investors will come and also be there too. I do think that there is some marginalization, which I know we're gonna get to, and I keep like alluding to it because there is so much bias.

But at the end of the day, if you build a really great business, You also don't need the capital. You have the control to decide what you want to do in your company. And I can't wait. Let's dig, dive like let's deep right into. I've raised six rounds of capital so far. Our last round was our unicorn round with our series D funding 245 million dollars.

And at this point, I even had two different options. I could have taken a majority option, which would've been like a, a private equity that would've come in and just bought out our current investors again and just done like a recap. but we ended up doing a minority capital raise, which means that I didn't, we didn't sell more than 25% of the cap table.

And so, you know, you're able to make [00:18:00] decisions like these when you have a solid

business. And so do yourself a favor

Jason: You your own

destiny, right?

Suneera: build a great business. Like there's no such thing as a billion dollar idea, only a billion dollar execution. If you execute and you build a great business, then you don't need to worry about anything else and you will find the right pieces at the right time to go scale on your terms.

Jason: Yeah. So then let's, um, the 245 million series D that closed at the most amazing time. March 20 22, will be the punchline. Will the thing be the thing that we get to.

I wanna make sure we onboard into the fundraising story and talk about your round in 2015, it's listed on crunch base that you raised 850 K I assume that was, coming out of the accelerator program you talked about.

but I, I wanna see if you can bring yourself back to 2015 Suneera, do you remember what was going through your mind? Like what was the thing that made you believe that now is the time. You had done enough to [00:19:00] be like, all right, I think I can go raise money. Do you remember what

was going through your


Suneera: Yeah, it was

fucking hard is what was going through my head. I mean, we were building a company, we had customers like that's what it was. We had customers, we had a demand. We saw that there wasn't a, there was a perfect niche in our marketplace, like payments were FinTech was like, it wasn't even a word into one.

Like people weren't even using FinTech at the time. So we were early at our time, we had couple of technology disruptors that had come into the space, square and Stripe and PayPal were probably ones that, you know, most listeners recognize, but there wasn't, everybody was single threaded in their solution sets.

So you had, you know, Stripe that was focused on developer solutions. You had square that was focused just on mobile or in person payments. We were here. There was nobody bridging the gap between online transactions and in person transactions. So there's so many verticals, like professional services, field services, right?

Your lawn care, you take a payment in person and then they gotta have a back office invoicing system, your dentist, you go do your copay and then they gotta bill you for your [00:20:00] kids. Like orthodontists, like your your braces bill, your debt, your braces' bill, right? And so there's so many industries, healthcare, professional services, uh, and service based industries that needed both the bridge between in person and online transactions.

And we were just, that's what we were doing. And so we felt like we had to double down. And I think in that moment I had a choice. Like I could go continue to build at the pace that we were building. But I think our customers were like growing so fast that we wanted, we knew that there was, this market was so massive.

And so that's, that was that point that we knew we had to raise capital. We did go through that venture accelerator. So that was my first footing into understanding the world of investors, And now there's so many options available. But in 2014, it was 2015, January the venture accelerator.

There was literally only one in Orlando. Like there wasn't a lot of like


Jason: So, so this is what I wanna pull apart. what you described, like, let's say we had computer AI generated mail voice describing [00:21:00] where you started, where it's like we had this business. I came from the industry. I knew there was a problem. I went out there, hit the pavement myself, signed up my first 15 of MRR.

Uh, it was happening. We just needed more capital to scale. That is the story that pattern match wise for a VC and early stage VC is like, oh, this makes sense. Right. So that would be a huge advantage. Now in 2015 Orlando or I was a venture capitalist at the time, we had a really hard time thinking about any deals that were outside of the major hubs.

It was this idea like how could you ever recruit the best talent to, so the example I'm giving is Minneapolis. We were, we were talking about this deal that we would do. We ended up doing it, but like, there's like a lot of consternation. Could we recruit great talent? Orlando definitely was not on the scene in, in 2015.

So that's one. Second is female founder. you've already talked about the numbers even today in 2022, very difficult to raise money as a woman and then three, um, [00:22:00] minority founders. So tertiary city, female founder, minority led business.

Tell me a little bit about starting the journey of fundraising. I mean, I'm sure the accelerator program did what they could to help grease the wheels to help

get your mindset right. But nothing really prepares a first time founder for what it's like to raise money. Can you tell me a little bit about difficulties or, or maybe it was easy for you, but like difficulties and, and the challenges associated with

raising that

first round of capital?

Suneera: It was far from easy. And when you just said those three things of like city, like the, a no name city, that's not a venture city, being a woman, being a woman of color. we were a unicorn to even begin with like, like we were a unicorn

to even begin with

Jason: That's a great way to


about it.

Suneera: It really was. It's so difficult.

I look back and I'm like, dude, how the hell did we do this? Like, I literally look back all the time and I cannot believe that this is our story. This is my story. Like I cannot believe it still. And it's still that pinched me like, it's hard work, like we didn't take any shortcuts. We put in the work, we're still putting in the work [00:23:00] and we checked discounts along the way for being in Orlando, we took discounts along the way for being a woman.

We took discounts along the way for being minority founders. And we gave up way too much of the company than we needed to. And so I do believe that there were so many disadvantages that we did have, but we found a way, you know, and so again, we built a great business. And so that is the one thing that I can come back and lean on is we know how to build a great business.

And I've done this now multiple times. I haven't fundraised for other companies before, but I now help mentor, you know, hundreds of female entrepreneurs. And I have a foundation for how to build a good business. And that's, that's the most important thing, but I look back, Jason. And I'm like, that was so difficult and there was not

one moment that was easy at all. First it was, you know, just getting our seed round. So you wanna do your friends and family round, but for most minorities and for like for marginalized community, like I don't have friends and family that just have like here dad, here's 25, like here's your $25,000 check.

and that's why it gets so funny to think about in the VC world. It's like, oh, the [00:24:00] friends and family around, but many of us don't have friends and family that can just fork out, uh, you know, the capital that we need, like a half a million dollar seed round is it's, it's not easy to even get friends and family or to be able to take that capital.

You asked me the question about asking for money. Okay. That is not in our immigrant DNA to go do that either. So.

That's one component of it. Two, I think the first check is always the hardest, right? It's like getting that first check. You get a lot of like people who are interested, you take meetings everywhere.

I just remember trying to meet every person in town and it's exhausting. You're running a business. You are taking every meeting possible. People are wasting your time as well, which is the most frustrating thing as a founder. Like everybody wants to have a fucking cup of coffee. Everybody wants to have a glass of fucking wine.

Everybody wants to fucking meet you. And then not like, do anything about it. Like, I don't have time to not take action. Like I've got work to do. I, I love that you were a retired ex CEO of some company that we've never heard of.

I don't know like who you [00:25:00] like, that's amazing that you've been able to do that, but stop wasting my time

if you're not gonna invest but you have to put in, you have to go like, you know, meet all of these. What do you call it to go find the, you have to meet the frogs to go kiss the frogs

Jason: just kissed a thousand frogs before you find the prince. No, I think you, one thing that, uh, I haven't talked about before is this, the angel hustle is such an interesting dynamic when you're pitching a venture capitalist,

at least

Suneera: That's all I have to say.

Jason: pitching to VCs your job to pitch their job to listen. Take the step before that, though, when you're pitching angels, you are pitching people like you described, you know, rich dentist uh, retired CEOs. You are pitching for your livelihood. This is your job. It's like a country club for them, you know, they're like, oh, Suneera I've heard great things about happy to take you out for a coffee.

Tell me about this. You know, they may or may not be doing it because they're hunting for a deal. They're probably just like looking to spend their time in a more interesting way. So the, [00:26:00] feeling and that frustration of that first hustle to get dollars

is, um, something that not a

lot of people talk



Suneera: It's so real. I actually haven't talked about it. Like this is the first time I think that I've actually talked about that angel hustle. That was really hard. And that was a lot of time that was wasted. And then we did get like, and those are the things like you don't know. Right. So you have to say yes, and that's what I look back at.

Right? Like it, it was hard, but we did get great angels too. I did meet like some of the, some of like, those angels actually are still dear friends of mine and like, we've done other deals together now. And so there are some really great things that come about it.

So you do have to put in the work, you do have to kiss the frogs.

You do have to say yes, but if I were to look back and give myself advice, I would say maybe vet them a little bit first or find from your network so you're not just having endless coffee dates and endless whatever with people who are not going to actually be able to take action. But there wasn't this like, list of like, It was Orlando.

Like there was there wasn't like, it was, [00:27:00] it was what it

was, but

got it done. Got it done.

You've probably heard me talk about the concept of an angel army before. It's a small group of investors whose main value is around expanding your network and enhancing your credibility. Instead of actual operating capital with the idea that they'll eventually help lead you to those bigger And what you just heard was a great example of raising an angel army.

A group of investors who had later come back around to help make stacks a unicorn. But when we come back, More on what it's like to be in the middle of that grind.


We all know that fundraising has long been a white male dominated space, but things seem to be changing for the better. Y Combinator has been increasing the number of minority founders in accepts. And more investment firms are adopting diversity and inclusion strategies.

But even if we're moving towards a more equitable future we're still living in a world in which being both female and pregnant can be held against you in the startup world. Scenario explains how she navigated those pressures and others on her route to becoming a unicorn.


Jason: do you remember, especially in that first raise any of the, the most difficult pitches or the conversations you

had, things

that, upset you

Suneera: So many. so many, So many.

if like the amount of times I think Sal and I were called children

Jason: Oh my

Suneera: the, I don't understand, like we're cuz we're young. Right? We were young. I was 26 years old. That was like in the first part of the raise, right? Like where people don't believe in you and they're like, well, these children can't like the child thing is like a real there's there's sexism, there's racism.

And then there's ageism too. And when you're young and you're, you, you are meeting with people who do have like a lot more life experience, a lot more business experience. That's wonderful. And I wanna learn from those things, but that doesn't discount where I am in my experience as well. So I think that there is definitely a lot of ageism as well.

That takes place, especially for young founders who haven't had a ton of business experience yet. That was one thing, but any stories? Oh my God. So many. So we got the angel round done, probably [00:30:00] plenty of stories that I can come up with. We could probably spend the next three hours going through it, but I would say like one of my most like heartbreaking stories was my series a, uh, I was pregnant for the first time with my daughter, Mila.

Who's now six or about to be six. and then my second, the series B, I was pregnant with Anna. So two fundraise I did while pregnant. Okay. So first I was told by mentors who I wanna say that they love and care about us. Like this was not like some asshole mentor who's like giving us advice, like.

To not share my pregnancy and they come from a place of protection because the venture world is just not, they're already not used to me. They're already not used to talking to a brown woman, then you're gonna add another complexity to this thing. It it's just a more, more biases and more questions. So.

Of course, I took that advice, but I look back and I wish I hadn't, but I also think about if I hadn't taken that advice, would my outcome have been the same? So I hit the pregnancy as best as I could. [00:31:00] Meaning like, you know, you just, you're not showing for a while. and, uh, you know, when we go out, there's lots of like fundraising, isn't just, it's not, it's the art of like the business pitch, but it's also all the social elements that go with it too.

Right. It's the dinners. It's the getting to know, it's the, it's the intangibles that a founder has. It's like all of these things and we're, I'm really good at these intangibles. but things like, I remember Sal and Jacque would order like, would order me a mocktail without it knowing like we had like

club soda. But like, I, I would make sure that it was like in a cocktail glass that like nobody was asking, you know, just stupid things like that. I look back at. So we were like, kind of asking it without thinking about it. Now we can sit back and laugh and talk about it, but that wasn't even going through my head at the time.

It was just like, we gotta get through this, get through the fundraise. But a story that comes to mind is like, even just while we're fi so I started to show obviously at some point and it was like, oh, well the questions that I have, two other male co-founders here, like the amount of time in a biz, we only have an hour, right,

of a meeting with you. [00:32:00] Okay. Then we wanna spend 30 minutes of our meeting talking about what my post pregnancy plan is like. Let's get to business. You're not asking. And what's crazy is that my co-founder Jacque was also pregnant. His wife was pregnant at the same time, but no one's asking him what he's, what his plan is.

And so just stuff like that, like I look back at and I'm like, girl, I don't even know how I got through some of the things that I got through. in fundraising and it, it was awful. Um, and I talk about it now. I mean, like I share all of this like very openly on interviews and I share it on my podcast and I'm trying to change the narrative in venture in like one part of the internet that I own, but it has got to change.

It is so biased and it's really difficult. It's really, really


Well Yeah.

Suneera: difficult.

Jason: Well I appreciate you being so transparent and sharing it. Um, I talk to a lot of female founders in particular, underrepresented founders, all those categories. And. One of the good things I do think is that the industry is at least talking about it. And we're, we're [00:33:00] trying to be aware of this problem.

Um, but it's not changing fast enough. And the, the harsh reality that I share with people is that unfortunately, it's people like you that are going through the more difficult times and founders that are raising now. and I think you're trying to normalize these things. It shouldn't be where that a woman can be pregnant and be an amazing executive and come back even stronger than ever, and have more to work for, to be honest.

but it doesn't happen until people see the example that they can follow. And that is what I like congratulate people for. That's what I get people prepped for and congratulate for when they go through it is that you are becoming the pattern that people after you can match against. Right. So, um, cheers for that.

I think what I'd like to do then is skip forward. So lots of stuff have happened between 2014, your first raise in 2015 to now you actually just announced a 245 million series D um, in March of this year. [00:34:00] Now a lot of things happen before announcing. I know, I know that's usually what happens. but maybe you can rewind a little bit and talk us through what's happening in the business in probably early 20, 21, where you're like, huh? There is another, you know, we've raised prob you know, probably 20 million before then. The business is doing well as that's your operating model, is to run a good business. Um, but there are decisions that you have to make around whether or not to bring in more capital. Can you talk us through that

a little bit?

Suneera: Yeah, it comes back to the same thing. It's building a great business and knowing where the market is heading to support that. I mean, we had, we've definitely raised like fright sub, um, Think it was total capital in to the business was like around 200 million. Um, and so in total, and that included also buying out our investors and not all the business, not all the capital.

I think that's where there's, there's so much about venture that people you learn as you go through these experiences. So don't let like titles [00:35:00] of like X amount. Like, it doesn't mean anything until you like, actually know where like dollars end up and things like that. So our previous raise of our series C was also a cleanup of our initial like investor base, our angels.

And then we had, uh, you know, a big chunk of capital put into the business. So probably about 75 million worth of capital over like that. We have used to go accelerate the company, but at the point where we were at this last year, it's another, it was the same, same situation. We are, you know, our growth rate.

We're at triple digit growth rate. So our business is booming. We invested heavily. So as we started off, we were a direct to business product, uh, where, you know, um, signing up customers one at a time in 2018, we focused on that last, that series B raise on our infrastructure and architecture of payments to allow software companies to then.

monetize for their customers and be that supporting arm. And we believe that all software companies are payments companies. They just don't know it yet. So in 2018 we were [00:36:00] ahead. So it's like, as we've always been ahead of where the market is going, cuz we're in it. We're we're with our customers, we're in it.

We have a direct customer base across our key verticals that we serve. So we saw it. We're like we need to go into these verticalized software. And that's where payments are gonna live. There's only a handful of companies in that space. Stripe is only one of them. There's literally five. Like there's nobody in this space and it's complete white space.

And we, we know what we're doing on both this card, present and card, not present. We need to bring our infrastructure to these companies. So that's when we needed to go raise capital because technology requires investment to go higher and to go build software at the level that we wanna do it. And payment software at that is compliance and architecture.

I mean, it's very, very complex. there's a lot of complexity in taking a transaction and taking it end to end. And so building that requires capital. Then on the other side, we have sales and marketing and for every dollar I put in, I get $3 back. So we have like this machine of an engine on the direct side of our business.

It's [00:37:00] all of the things on building a good business, but also knowing where the puck is like headed and getting there versus following the puck. And so that's kind of been the strategy for Stax and then for this last fundraise, we are also smart about building and validating before we go put the fire.

And so I wanna be really, really, really sure. And I think this is where there's a difference between female founders and male founders and men usually will, um, you know, take more risk. Right. and, and honestly, for female and men, from an investment standpoint, investors will invest in men for their potential, investors will invest in women for what they've done.

So it's almost like this own internal bias that I have that I have to go prove it harder than my male counterparts have to anyway. And so I think I've been trained subconsciously in that way. So I go build first, we had about almost 50 partners, software companies already on the side of the platform. And then, then we went out to go raise to say, okay, this is like a big area of the company.

That's hockey sticking. We need to go [00:38:00] invest. And that's where we went out to go do another capital raise. And so that was what took place. It was a completely different process at this level of fundraising. so we, we were at it for. like almost a year, I would say since the process began to like, what we officially came to market was fall, uh, like Q3 of last year.

So it's been about a year since now. but that was more, we did a formalized process. investment bankers. We did the whole road show and we were really selective about who was going to be our next strategic partner. On the other side, we went through kissing a ton of frogs again, and then we ended up just

picking our current partners. So our current partners ended up putting in more capital into the business and we ended up doing a minority capital as we brought on, uh, net new partners. But we didn't end up doing like some big, uh, deal with, you know, some of the major players that you may know of. Like, you know, I'm not gonna say that were in the process, but you know who they are that would come in at this [00:39:00] level.

And so we ended up sticking to our own path and doing a minority and then the next step would be you know, taking the company public would be probably

next or a strategic, so.

Jason: super exciting. Uh, couple things I wanna react to is, you know, that bias around the funding of men and women. I hadn't thought about that before, but I think directionally speaking that's right. And now with where the shake up in the venture capital markets have been, there's, there's been so much excess around 20 and 20, 20 to 2022 of making these bets based on the future and craziness and giving people multiples that kind of blow my mind as a ex-VC from the 2012 to 2016 era. But hopefully that bias, helps out female backed companies in this coming generation, because that is, I think that is where things are going, is that there's going to have to be much more proof around what is possible, what has already been done. So that's interesting. and then two, it's just, you know, when I think about raises that are done, amazing rounds, [00:40:00] 245 million raised 50 million raised. They always seem so like, oh, that was like a slam dunk. But you know, if you're trying to price your company competitively, and you're not trying to give your whole company away, no matter how good of a company is there. You're gonna be on the Razor's edge of people saying no.

And people saying yes. And so there must have been this moment that when it was all said and done, you were like, wow, we, we, we did it. Do, do you remember that moment? Like when, especially your insiders who were like, you know what, we should just do this scenario. We're gonna, we're gonna give you a term sheet.


do you remember that moment?

Suneera: Yeah, it's always, when you get the term sheet in hand, when it's like actually physically there and you have it, and it's it doesn't and it doesn't, it's actually not even real in that moment, because term sheets are still

like, you learn that there's still a process after that. So it's never done until money hits your bank.

Like, that's it. Then you can celebrate. So we really do. We try to have these like micro celebration moments, but I will tell you that when you [00:41:00] get that term sheet in your hands and it's validating and it's, whatever that value is. It's real. Right. And that's when it becomes at least more real and it feels like, oh my God.

Okay. That, that was worth it. Like we have something tangible in our hand. I remember I'll share a story to kind of close this out. Our last round before this was with the private equity group, Greater Sum Ventures who did that series C round cleaned out our investors. There was a big recap of the company.

Um, and it was a really significant round for the company, not only from a cash inflection for the business, but it was also where a lot of our team got to take off chips off the table. And so we've been working hard for, it was like eight years into building the company. I'd never taken off like any, I hadn't paid myself for the first five years of the company.

And so we've had a lot of, we've put our house on, you know, more like a lot of things like. Founder last minute story that you can think of not making peril, I've been there, but it was really meaningful. I remember to like that round, it was roughly like a 200, two 50 million [00:42:00] value of that last, that, that round.

and it was really sizeable and we were cleaning up the cap table. So it was a 70% buy. And as I mentioned to you. The one thing that I do regret in my, the only thing that I regret is giving up more capital than I needed giving up more equity than I needed to. I wish I would've learned the things that I know now.

because I do feel like at the point that I was in like, um, if I had more knowledge, I would've been more keen on holding onto more of it. And I, but I also didn't have a choice again. I go back and I'm like, would I have changed it? Yes. Could I have changed it? I don't know.

Right. And so, but I remember, so I, I remember flying up to meet the head partner at Greater Sum,

and this is a moment in my life. I'll never forget. It was a term sheet. They presented the term sheet to me in front of me. Okay. So like, it was like physically

in front. and it's like a, it's literally it was a movie. And so you have your, you have like a folder, like a Manila folder. And all I wanna do is look at the number, like all [00:43:00] I wanna do.

And it was the first term sheet. So we had like a bid day and we had all these different, people that were, we were expecting term sheets from to choose from. Um, but what I loved about this partner is that they wanted to do it in, in person. And that was something that was so important to me. And it was probably one of the reasons I ended up choosing this partner.

because of that human . Element, but I remember them like, like slipping over the Manila folder to me. Okay. And I'm trying to literally hold my composure, but I can't, this is the first time that I was like, real. Everything's been real up in this point, but it was real for me and my team. Like, I carry that weight for like those like first 50 employees that like we've put in everything that we had into this company.

And I was looking for, and I opened up the piece of paper. okay. And I am trying to pay attention to any words. I don't even know anything that was said in those five minutes that were taking place that people were talking. They were trying to tell us why they're gonna be great partners. Like I don't even know.

It's like literally flying through and I feel like I'm in like the matrix of some sort [00:44:00] and I pull it open and I'm trying to find this number. And it's of course at the last page, but I'm not trying to like flip through it in my heart and I can still feel my heart right now, going back into, into that seat.

And I've never shared this story, like public. so I appreciate you bringing me back here. My heart is literally like, through my, like my, my brain, like it's literally out of my body and I'm shaking and I'm trying to find it and I see it and I literally see it. And there it is. And it's the number that we want.

Like, it's, it's, it's the number close enough to where we want it. Okay. But it is that it is that buyout of all of our previous investors, which gives us like liquidity, some liquidity for it, for my founders, my co-founders for my team. and I literally look at it and just tears start falling on my face.

Like I could not, my eyes literally just swelled up with just like the heaviest, teardrops that you can like, and I couldn't even close my eyes without him just like falling like raindrops. and I'm not, I'm not crying. It's just like the emotion that [00:45:00] took place. And I closed the envelope and they noticed that, like I saw it and like the first words that come out of my mouth to the partner.

and I just say like, thank you. Like, that's what I said. I said, thank you. And like, this is the first time that I've seen, you know, this is the first time we have our term sheet. It's meaningful. It's meaningful for me and for my team. And we appreciate you all so much for putting this together. And the number has to be higher and I slip back them

Jason: Oh,

Suneera: and I

slip back and I slip back the envelope and my brother's sitting next to me and he's laughing because this is like.

and that's exactly like me and like it it's to get emotional and then to get back to business and business is personal, Jay. Like it is so personal and I'm so happy to say that we did. We upped the Val, like we upped the value. We chose that partner. We got the value that we wanted. We made 30 millionaires on that round from my angels.

We made 18 times our money for our angels, by the way. [00:46:00] We made every, we made our angels money. We made people in Orlando money. We made our team money. We had so many, six, just from a, from a recap, not even from an exit, it was the first bite of the apple. And so I think what's really exciting is I've experienced that and I didn't exit the company and then now here we are again.

So at this moment, I had an opportunity to do I wanna do our recap again, which could have been the right move for me personally, let's say as like a founder, right. And cashed out, sold it to like a Vista or something. And I'm like, here, you guys deal with this and grow it, but we, we're not done. And we're building something and I do believe in representation.

So on this last round, I wanted to take the minority option versus the majority so that we can go do it really, really big. And we did already do it big, but you know, we're one we're, we're a unicorn. We're the first Pakistan. We're the first like brother, sister. but like from a minority standpoint, I mean, we're like the only, we're the first unicorn out of Florida.

This is a really big deal. especially for what we [00:47:00] represent. And we've gotta take this, like, forget the it's not the million. I don't know if it's gonna be decor. I don't know what else is next. We're not stopping until we have like the biggest outcome for our entire team. So that's, that's how it

comes full circle.

That was my conversation with Sunita Madani founder of stacks. The Orlando based payment processor, startup. That now has worked with over 22,000 businesses and processed over 23 billion in payments.

When we come back, it's a moment of truth for my producer, Olivia, she tests out how much she's really learned over these past few seasons.


[00:48:00] [00:49:00]

Olivia: I wanted to start a little bit talking about pattern matching. I know it's something we talked a lot about in season one and I wanted to run some analysis by you. Um, I'm hoping that, you know, I've progressed over the last few seasons and, Okay, let's see how I do here. My observation from listening back to this conversation is that, this interesting contrast of having, in a lot of ways, the exact patterns that investors look for.

Like I remember you said, you know, this is an investor's dream. Like you already have a successful business. You just need capital to scale. And then she also had a background, in the exact industry she founded a company in, but then also she really deviated. Patterns in some ways, like being a first time founder and then she was pregnant, at least during one raise.

And then also [00:50:00] Stacks is based in Orlando. And I guess that's my observation. So first question is like, am I a genius? What do you think? And then, um, my second question is like, when that happens, I guess how common is that, that someone is both like, Tick so many boxes, but then I don't know. But I guess my, my other question really is like the impact that that can have on the fundraising dynamic?

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: Sure. Well first, uh, very good analysis and less so labeling you as a genius in me, just like an amazing teacher. Wow. I have, You're like my star people.

Olivia: genius. Yeah. You're the genius.

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: star people. No, I, I think you called out a lot of. , really important concepts to make sure that we underline. So this idea of pattern matching, is important to pull apart.

And I know we've talked about this before, but let's highlight it, which is, um, the job of a venture capitalist to decide [00:51:00] where to allocate millions of dollars, especially at the earliest stages, is kind of hard. I mean, I know we're, we're very profounder on this podcast, but I used to be a vc, so I sympathize with, with the job.

You're, you're talking to founders and looking at companies that are so, so early stage that there's very little, if any hard data to go on. You, even, even the data that they do show you, the product that they do show you can't tell you with any degree . Of certainty what it's going to be. In a year, let alone five years.

And so the most powerful tools or the most accurate analysis they have is just to say, Does this look like something that we've seen before that has been successful? Right? Because that can kind of encapsulate a ton of the different variables that go into whether or not a company's successful. Does the founder have the.

and ability to actually grow with the company. does the team gel and are they able to hire? [00:52:00] Can they iterate on the product? Can they actually attract customers? These are all little details that you have to make a decision around in a very short amount of time. And so pattern matching is this dumb, inaccurate.

Tool that you have in your toolbox as a venture capitalist. Um, and so when you go see someone like sin, when she started, yeah, she did check off all these boxes. Worked in the industry before. So they have, she has insight, insider insight into that customer. Um, she had bootstrapped all the. and showing that she's running real business.

She's not just like making things up. She can execute and operate, but the things that were atypical, um, candidly just make a venture capitalist pause like we talked about the city. It's like, have I ever seen this before? can they hire to a city that hasn't in the past actually been able to attract like the top level of [00:53:00] engineering and marketing talent?

And then especially back. 2 20 14, um, hadn't seen a lot of women actually build gigantic businesses. And so these are dumb, blunt tools to make, uh, an important decision. But to your second question, um, how much does that impact the VC's decision? and not in a malicious way. They are trying to make the safest bet that they can, to be honest, where it's like, they are.

Okay with false negatives, as in they pass on someone and they're like, Oh, maybe we messed up. That was actually a pretty good bet. But, the false positive is one that they're like kind of upset about where they like put money to work and they were like, I shouldn't have done that. It went to zero.

so they will look for any opportunity to just use, um, a simple tool in order to make a bet that they think has a higher likelihood of being [00:54:00] successful.

Olivia: I think that makes perfect sense, and it just reminds me, I feel like a lot of this fundraising language makes it sound like a new idea, but it really reminds me of. someone who's hiring for any position where, um, you know, like a lot of the time, in the past I've thought about getting out of podcasting and doing more like writing.

Yeah, I have thought about it, Jason, and I've thought about doing more like written journalism and stuff like that. And when I've applied for positions like. People really have a hard time seeing me. Like I match the pattern in a lot of ways. You know, I have a lot of journalism experience, but, but then it does, people do view me as a wild card, and then often I do learn that they have hired someone who has the more conventional background and [00:55:00] pattern.

And so I guess from my, um, if I had to guess like. How to, how that impacts the dynamic. Like you are someone like San, you probably do need to, you probably like, at least because of the Orlando part, you probably will be perceived as a little bit of like a risk. but she's also someone who could really make it, you know?

And so you probably need an investor who's less, maybe won't get like conventional backing, but you will probably get people who like have an appetite for some risk,

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: Yeah, and let's be completely candid about it. I mean, being a woman, especially back in 2014, was perceived as a risk, as inaccurate as that is, that was the perception. And, um, you know, one thing you called out is, is like this concept of, you know, entry level position. Must have two years experience. And

you're [00:56:00] like,

Olivia: Yeah.


funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: Um, and I talk about this quite a bit, where we are in this transition point, we have been in this transition point over the last couple years where the industry understands how much of a, a situation they created where. Yes, you're pattern

Olivia: Yeah. Yeah. Right,

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: running the same pattern, all you're doing is making the one pattern be the only acceptable pattern when we know that women, minorities, other cities completely have the talent and ability to create great companies.

And so where, where, where we're at and why I applauded Sunir so much is. Even with the industry wanting to make changes, the fact is change takes a long time to happen. And so this current generation of founders, uh, especially the . Underrepresented, you know, females, uh, founders of color, et cetera, they are still going to have a really [00:57:00] hard time even with all the awareness of the, um, inequity in the industry.

But people like San are going to end up becoming. The patterns that future founders get to match against. So the fact that she was able to do so much and now has such a visible platform and talks about it a lot, means that Olivia, when you go raise someone who had invested in Sinero will be able to say like in their head, This reminds me a lot of sin, you know,

Olivia: No. Right. And it won't be like a risk calculation. It will, Yeah. Those things shouldn't be perceived as, as risks they should. So that's interesting. and that's, that's good to hear that obviously it's a long and slow process and, um, Could take multiple generations. As I was just saying that, I was thinking about like future Jason, like, like, like

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: me more about [00:58:00] future Jason.

Olivia: I was just picturing like

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: Present day. Jason

wants to know,

as well.

Olivia: No, like the people who will, Sorry. You mentioned that we get profound on this podcast. I think you said that earlier, and this is more meta, but I was just like picturing generational change and like, Who Jason would be like in 21, 22 or something. Um, he would be dressed like Neo from the Matrix.

That's what I imagine. Um,

Jason: I have that same, I have the same image in my head. Love it.

Olivia: Anyway. Um, okay. The other thing that I wanted to talk about though is, um, this wasn't a huge part of the conversation, but when I really thought about it, I was like, I don't really know much about angel investing, and so my first question is like, what the heck is an angel? And, okay. let me throw out what I'm able to parse from this.

Is it that an [00:59:00] angel is an individual and, uh, versus like a VC is an institution or something? Is that the difference?

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: That is, that's one of the differences. I mean, Angel is this term, by the way, that came from Broadway. So Angels, Yeah, Angels were the first backers of, of shows. They would, um, they would put the money behind these shows, which, uh, many times didn't make any money. So you had to be like, Angel sent from Heaven to even allow us to create this, this show.

Um, and so that term has been extended to any sort of individual investing at the earliest stages. Um, so your question of is it just an individual versus a firm, the.

Olivia: Yeah.

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: Somewhat. I mean because, But I wouldn't say that that's the primary distinction because there are individuals that run their own venture capital firms.

I think when we think about the term angel, it really is this idea of taking the biggest [01:00:00] risk because it's the earliest capital and, These individuals are, you know, they might not know exactly where their money's gonna go, and they are just like coming down from heaven and bestowing you with some money to just get started.

And a lot of times these angels are like, they know or they're not making decisions the same way, venture capitalists are in terms of like full portfolio and what

Olivia: Yeah, it's more like a gut instinct.

Jason: right, That's right. For, for a big portion of angel investors that it was, it's really like a gut instinct.

I, like this person and I'll make a decision really quickly.

Olivia: Okay. Okay. Interesting. Um, that was, that was, that was just like a side note that was funny and insightful when you described it. Uh, like the angel scene as a country club or whatever cuz Yeah. Who are like, it, it's just interesting cuz there's like this mismatch. Of incentives or something where like an angel just, you know, wants to have a [01:01:00] nice afternoon meet, meet a young interesting person who maybe has a great idea.

And then obviously the founders like senior, like they, there's much more intentionality and it's not like a meandering afternoon. Um, so I thought that was interesting. But the other thing I wanted to ask was, um, So I think she described one of her rounds as an angel round. Like, um, is that a thing that people go for?

Like, do people have rounds where I'm sure everyone's hoping for an angel, right? But. I got some intentionality from her that this is kind of what they were seeking. And why would you, like what is the function of that round? Is it just you're trying to get the most bang for your buck and only get one investor?

Or why? What's the strategy there?

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: Uh, it's a, it's a great question. so. [01:02:00] There are two parts to my answer. I'll, describe what I imagine was going through her head back then, and then I'll describe how this strategy has kind of evolved over the years and something that I've actually like grabbed on myself in

Olivia: Angel Army.

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: That's, oh my gosh, star pupil.

Yes. We will talk about the angel army right after that. Uh, but back in the day when she was raising it was probably just that. have access to venture capitalists. She didn't have access to formal investors. And, um, anytime that she did have a conversation with maybe a former vc, uh, a formal vc, they were probably like, Oh, we don't wanna invest in, uh, Orlando, Or they probably wouldn't have said it out loud, but a woman.

And so the only shots that she thought she could convert on were ones with angels, ones with individuals. And so an angel round was probably more.

Olivia: like what, This is like going back to what we were talking about initially where this is because she still, [01:03:00] because of the pattern matching problem, like she needed someone, like we were talking about like an app with an appetite for risk.

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: Right, That like doesn't make the same decisions based on certain patterns. Right. So it was probably more of a necessity than it was a explicit strategy of hers. So her, that first round, that angel round was. Like we need, you know, we need to raise $500,000 in order to pay for the servers or, you know, pay for these engineers in order to scale.

Because we have so much business. We're gonna piece it together with little 25 50 K checks here and there and just get going. And then once you have that initial tranche of capital in, then you're able to produce more traction and growth, then you have more. Tangible things to go to formal investors with.

Now what you, what you hinted at and, and what I had talked about right at the start of this is, um, now this is becoming more of an explicit strategy, the whole angel army, which is that [01:04:00] now, um, there is a crop of angels that aren't just rich dentists that don't know anything about the startup scene or retired CEOs.

There are. 25 year old up and coming product managers at

Olivia: are you in it? You're an, you're an angel. No.

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: That is true. I am an angel investor. . Exactly. So I, I don't, I don't think I look like a retired dentist, um, . No. But there is this crop of angel investors like myself, or like an up and coming product manager for Carta or Stripe. Doesn't have a lot of money, but knows the space really well, Has an incredible network, and there can be a deliberate strategy to say that we're going to bring on 20 angels. In a first round where the main goal is not necessarily can I get a bunch of operational capital, like can I get $500,000 to execute on my my milestones?

It's more to [01:05:00] say, Can I get 20 awesome people onto my cap table where their networks all of a sudden become accessible to me? And the credibility of somebody from this hot company investing me is a signal. Future venture capitalists to say, Oh wow, this is a deal worth doing. Um, so that is a strategy that I am a big supporter of and encourage a lot of founders to.

Olivia: that's interesting. Let me, repeat back some of what I'm hearing from you. So, . Um, it sounds like you were just describing that there's kind of been a change in what an angel or who an angel can be because in my mind, like I think that the concept of an angel is actually one of the most accessible, concepts related to fundraising.

Like I think it's something that my parents know about. I think it's something that, like most people have heard of an angel, but when. US [01:06:00] normal people. Think of an angel, um,

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: Normies.

Olivia: Normies, uh, non VC folks. I think, I think of like. I think of a man, definitely a man, probably a white man who lives in like a very modern home.

and I, I definitely think of it as one or maybe two people or something who really propel your company and they give an obscene amount or something and like, don't ask a lot of questions and just write you kind of a blank check.

But that's interesting that it's taken, I mean, to use a political term or like, um, Yeah, like a grassroots direction. Um, and that's just so is like a Kickstarter model. That's interesting. But like irl.

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: Totally. Yeah. And, and it's actually good for a lot of reasons, I think, um, I think it's gonna end up creating a lot of wealth for people that don't have it already. So getting into the earliest stages of, generational [01:07:00] companies is gonna create a lot of wealth for people. Um,

and then like, it also helps companies get started in, in a much more, um, expedited fashion.

Olivia: but I, So Sun. Sun, Gosh. Sun. Sun. Okay. So Sun did not do an angel army though, right? She did a more traditional OG angel, Right.

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: Yeah. She, I'm pretty sure she wasn't like, I'm gonna go tactically, choose the best. Small individual choice, I think. I think, yeah. I think she was just like, Whoever will consider giving me money, my company's growing. I need to grow it. And so she probably did have, you know, she kissed a lot of, uh,

Olivia: Frogs. That's right you guys. Yeah.

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: gems.


Olivia: Gems. Yeah. You guys, there was so much frog smooching talk in this episode. . There was a lot of reference to that. Um, let me, Okay, wait, let me just see if there's anything else. Oh, okay. [01:08:00] Um, I guess just to close out here, did I hear that right where she's like, Did I, I, Okay.

I think this was our first guest that this had ever happened to. You tell me if I understood this correctly. She's, When you guys were talking about the possibility of a future raise, she basically was like, Oh no, like our next step is to go public. So like, did we, Well, I didn't get to meet her, but I'll just say, did we have a guest on here who.

Fundraising served its purpose, like the life cycle is complete. Like she funded this company and now the next step is actually not fundraising, it's to go public.

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: Well, yes and no.

Olivia: Oh, okay.

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: Yes and no in that, um, going public is actually a fundraising

Olivia: What? No.

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: I think it's a technicality that, um, a lot of normies. Don't quite understand . No, but it's initial public offering is the,

[01:09:00] is what IPO

Olivia: p o, also known as I P O.

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: also known as ipo. You are, you are selling shares to the public.

So um, you actually bring in new capital and it is a fundraise process. It just means that

Olivia: massive Angel Army.

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: it in some ways. Exactly. But no, I also think you're right. It got her to the point where she even. In her sites that she will ipo, which is the concluding point for a lot of these startups. Um, and so in that sense, you're right, the ipo, um, is that, um, is that event that makes equity in a company

Olivia: Yeah. Yes,


Jason: now, now the founder and now the investors, and now the employees, those shares become shares that can be traded on the open

Olivia: Yeah.

Jason: hard cash. And so that's a big, big moment, for every company.

Olivia: Okay. But then after a company goes public, then the fundraising is done, right? [01:10:00] No, but then what about

Jason: I mean, not sometimes. Sometimes they need to raise more money. Um, yeah. You can do, you can, you can do it again. You can, uh, can sell more shares, you can do debt offerings.

Olivia: Right. You can,

Jason: these are small technicalities that we don't have to get into.

Olivia: Okay. But definitely felt like a huge milestone that

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: Huge. That'll be a

Olivia: That felt wild. Okay.

That's so cool.

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: even though there is. Technically more fundraising in the future for, for a lot of companies that ipo, um, your, your instinct is correct that the IPO is the thing that all these venture back founders are really, really driving towards. we're excited to see Siner get to that point.

Olivia: Yeah. No, that's, that's so cool. I guess I'm a little late. You know, I wasn't, asked to be a part of the . Angel Army, unfortunately, [01:11:00] but you know, maybe at the IPO I can get in.

funded_debrief-for-suneera-episode_jason_yeh-ncrqdgrws_2022-oct-02-1833pm-utc-riverside: Squeeze in, be a shareholder. I, I think I'd, I'd wanna be a part of that as well.

Every business needs a payment processor, right. Well, it turns out that's true for companies you didn't even know existed. Here's scenario on the weirdest most unexpected businesses she's worked with.

Suneera: Oh, my God. We've serviced every type of business. And you learned that there's a business for everything. God, we used to have like a board that was like the weirdest business board. What are some things that people make everything like when you talk about like widgets, like literally people have to make like the, the things on a somebody makes that, so there's a business for that. From like a service standpoint, got, there is a person in Florida that literally there's storms that come through. So there's a business for like putting, Closing your windows where like that's a business, right? So we've service businesses like that,

Jason: You're doing


Suneera: entrepreneurship

Jason: You're doing


Everything [01:12:00] is a business.

Jason: Thanks a bunch If you have any questions about today's show, or maybe you're raising money yourself and want some help. Problem-solving. If, so find me on social I'm at that's J a Y Y E H. Or shoot me an I'd love to hear from you.

This episode was produced by Olivia Rheingold and angel Adriano.

Thanks also to Jonathan Lee from adamant. And thanks to for being an amazing guest and for reminding us to always have the courage to bet on yourself. Turn that multimillion dollar check around and say, nice. Try, try again. As always one last thanks to our fantastic sponsor. Vanta the leading automated security and compliance platform.[01:13:00]

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