I never had access to money during my childhood, or even as I grew into a teenager and young adult. Both of my parents lived paycheck-to-paycheck and struggled with debt, so that’s really all I knew.
As a result, I was never really exposed to the investing world, nor did I learn to think of entrepreneurship as a viable career option. My parents were busy trying to keep the lights on and food on the table — the thought of having extra money to invest and build wealth would have been completely foreign to them.
Eventually though, I got my first introduction to the concepts behind investing and building wealth. I majored in finance in college, learned about mutual funds and ETFs, and found out how the stock market really works.
As I began my career as a financial advisor and transitioned to entrepreneurship, I was always looking for ways to increase my base of knowledge. I read books like Rich Dad, Poor Dad andCrush It: Why NOW is the Time to Cash In On Your Passion by Gary Vaynerchuk. However, books like these didn’t teach me how to invest my money. Instead, they taught me how to invest in myself and my personal growth.
5 “Non-Investment” Investments Rich People Learn to Make
The thing is, these are areas where rich people really do invest time and time again. That’s because they know something most people don’t — they know that growing wealth is about more than throwing money into the stock market, becoming an entrepreneur, or taking big risks to fund a promising startup.
Building wealth is just as much about becoming the best version of yourself, staying in constant learning mode, and building a network of like-minded people who can help you reach your goals.
Want to know exactly what I’m talking about? Here are some of the most common non-financial investments rich people love to make:
Most rich people read a lot of books written by people who inspire them in some way or have unique experience to share. I’ve always been a big reader too, diving into books like The4-Hour Workweek by Tim Ferriss andThe Millionaire Messenger by Brendon Burchard.
Reading is such a smart and inexpensive way to fill some of your free time and increase your knowledge, which is something the wealthy already know. If reading a few hours per week could help you stay mentally sharp while you learn new things, why wouldn’t you make that decision over and over?
But there are other ways to accelerate learning that don’t involve reading or books. You can also take online courses in topics that relate to your career. As an example, I’ve personally taken courses on YouTube marketing, productivity, search engine optimization, and affiliate marketing.
Going to conferences to learn new skills from others in your field is also a smart move rich people make. FinCon is a conference for financial bloggers I attend each year that I can attribute making millions of dollars from — mostly from meeting brands, learning new skills, and networking with my peers.
Personal coaching is another smart investment rich people make when they know they need some help reaching their potential. Morgan Ranstrom, who is afinancial planner in Minneapolis, Minnesota, told me he wholeheartedly suggests a high-quality coaching program for anyone who needs help taking that next step in their business.
Ranstrom has worked with various life and business coaches that have helped him understand his values and clarify his goals, become a published author, and maximize his impact as a professional and business owner.
“For individuals looking to break through to the next level of success, I highly recommend investing in a coach,” he says.
Personally, I can say that coaching changed my life. I signed up for a program called Strategic Coach after being in business for five years, and this program helped me triple my revenue over the next three years.
The thing that scares most people off about coaching is that it’s not free; in fact, some coaching programs cost thousands of dollars. But wealthy people know the investment can be well worth it, which is why they’re more than willing to dive in.
Mentorship can also be huge, particularly as you are learning the ropes in your field. One of the best mentors I had was the first financial advisor that hired me. He was a million-dollar producer and had almost a decade of experience under his belt. I immediately gained access to his knowledge since his office was just next door and, believe me, I learned as much as I could.
Todd Herman, author ofThe Alter Ego Effect, shares in his book how he mentored under the top mindset coach in his industry when he couldn’t really afford it. He lived in a Motel 6 for almost a month to make the program fit in his budget though. Why? Because he knew this investment was crucial for his career. And, guess what? He was right.
Over the last year, I’ve participated in mentoring with Dr. Josh Axe, an entrepreneur who has built a $100 million health and wellness company. Just seeing how he runs his business and his personal life have been instrumental to my own personal growth.
It’s frequently said that Dave Ramsey was in a mastermind group called the Young Eagles when he first started his business. Entrepreneurs such as Aaron Walker and Dan Miller were also in the group, and they leaned on another for advice and mentorship to get where they are today. Ramit Sethi, bestselling author ofI Will Teach You to Be Rich, is in a mastermind group with Derek Halpern from Social Triggers.com and other successful entrepreneurs.
I also lead a mastermind group for men. Believe it or not, one of our members has been able to increase his recurring annual revenue over $300,000 because of advice he has received.
These are just a few examples of masterminds that have worked but trust me when I say most of the wealthy elite participate in some sort of mastermind group or club.
Mastermind groups are insanely helpful because they let you bounce business ideas off other entrepreneurs who may think differently than you but still have your best interests at heart. And sometimes, it’s a small piece of advice or a single statement that can make all the difference in your own business goals — and your life.
When it comes to the top tiers of the business world, there’s one saying that’s almost always true:
“It’s not always what you know, but who you know.”
“The right connections can help land better jobs, accelerate promotions, or start lucrative businesses,” he says.
But it’s not about cheesy networking events. To get the most value, focus on meeting people at professional conferences, mastermind groups, and high-quality membership communities, says Whitehouse.
This is a strategy most successful people know — meet other people who you admire and build a relationship that is beneficial for everyone.
But, there’s a catch — and this is important. When you meet someone new who could potentially help you in your business, you can’t just come out of the gate asking for favors. I personally believe in the VBA method — or “Value Before the Ask.” This means making sure you provide value before asking a favor from anyone.
In other words, make sure you’re doing your share of the work to make the relationship a win for everyone. If you try to build relationships with other entrepreneurs just so you can ride their coattails, you’ll be kicked to the curb before you know it.
I am a certified financial planner, author, blogger, and Iraqi combat veteran. I’m best known for my blogs GoodFinancialCents.com and LifeInsurancebyJeff.com and my book, Soldier of Finance: Take Charge of Your Money and Invest in Your Future. I escaped a path of financial destruction by being a college drop out and having over $20,000 of credit card debt to eventually become a self-made millionaire. My mission is help GenX’ers achieve financial freedom through strong money habits and unleashing their entrepreneurial spirit. My work has been featured in The Wall Street Journal, USA Today, Reuters and Fox Business.
Warren Buffett is the godfather of modern-day investing. For nearly 50 years, Buffett has run Berkshire Hathaway, which owns over 60 companies, like Geico and Dairy Queen, plus minority stakes in Apple, Coca-Cola, and many others. His $82.5 billion fortune makes him the third richest person in the world. And he’s vowed to give nearly all of it away. The Oracle of Omaha is here to talk about what shaped his investment strategy and how to master today’s market. I’m Andy Serwer. Welcome to a special edition of “Influencers” from Omaha, Nebraska. It’s my pleasure to welcome Berkshire Hathaway CEO Warren Buffett. Warren, welcome. WARREN BUFFETT: Thanks for coming. ANDY SERWER: So let’s start off and talk about the economy a little bit. And obviously, we’ve been on a good long run here. WARREN BUFFETT: A very long run. ANDY SERWER: And does that surprise you? And what would be the signs that you would look for to see that things were winding down? WARREN BUFFETT: Well, I look at a lot of figures just in connection with our businesses. I like to get numbers. So I’m getting reports in weekly in some businesses, but that doesn’t tell me what the economy’s going to six months from now or three months from now. It tells me what’s going on now with our businesses. And it really doesn’t make any difference in what I do today in terms of buying stocks or buying businesses what those numbers tell me. They’re interesting, but they’re not guides to me. For more of Warren Buffett’s interview with Andy Serwer
Dr. Joe DeSimone took his own path to entrepreneurship. His latest venture, Carbon, is changing the way things are made.
He’s assembled one of the most impressive Board of Directors and line up of investors to transform the $300 billion manufacturing industry.
Joe recently appeared as a guest on the DealMakers Podcast. During his exclusive interview, he shared how his team is transforming how the world makes things, the fundraising process, what it’s like building a nearly 500 person company in less than 6 years, and many more topics.
From Academia to Entrepreneurship
Joe DeSimone was born and raised in the suburbs of Philadelphia. Ever since high school, Joe found he had a knack for chemistry. For both understanding it and for teaching it.
He attended Ursinus College, and then Virginia Tech for his Ph.D. On a tip from a faculty advisor, he went to check out the University of North Carolina, at Chapel Hill—-one of the top 10 chemistry departments in the country.
If he would teach organic and polymer chemistry, then they would give him $500,000 to start a research program. He was convinced. At UNC, he enjoyed a highly successful career as a professor for 25 years.
Joe taught a lot of students chemistry and mentored many researchers. He learned that people have very different learning styles. From his perspective, if you want to be a great teacher, you have to take responsibility for explaining complicated topics in accessible ways.
It turns out that is a really important trait for entrepreneurs too. It’s a valuable skill whether you’re doing it in a classroom setting, talking to VCs or investors, or your own employees. The importance of bringing people along with you.
His position in academia enabled Joe DeSimone to pursue a handful of interesting startups based on his research before he launching his newest venture, Carbon, in 2013.
His first company was BioStent. A partnership with an interventional cardiologist at Duke University. They developed a coronary stent that is polymeric instead of metal-based. It dissolves in the body after 18 months, once blood vessels can operate on their own again. The company was acquired by Guidant, and then Abbott.
Next, it was Liquidia Technologies, a partnership with one of Joe’s Ph.D. students including Jason Rolland, now SVP of Materials at Carbon. Liquidia went IPO last year.
They developed technology that leveraged tools from the computer industry to make precision nanoparticles. It spawned new and more effective ways to deliver medicines to the airway.
It has proven valuable in improving treatment approaches for diseases like pulmonary arterial hypertension, and in creating next-generation vaccine platforms for infectious diseases and certain cancers.
After spending 25 as a faculty member at UNC, the opportunity to go to Silicon Valley and take on a new entrepreneurial challenge was something Joe couldn’t pass up.
UNC agreed he could take a sabbatical to pursue his idea. That was five years ago.
Departing Academia for Silicon Valley
When Joe left North Carolina for Silicon Valley to found Carbon, he didn’t know what the future would hold. Carbon is now one of the world’s leading digital manufacturing companies.
Based in Redwood City, Carbon’s mission is to enable companies to make breakthrough products that can improve human health and well being, transform industries, and change the world.
Joe launched the company and its groundbreaking Digital Light Synthesis™ (DLS) technology on the TED stage in 2015. DLS fuses light and oxygen to rapidly produce products from a pool of resin. Using DLS technology, Carbon is enabling companies like Adidas, Riddell, Ford and Johnson & Johnson to create breakthrough products at speeds and volumes never before possible, finally fulfilling the promise of 3D printing.
Joe believes that empowering product teams to make breakthrough products and bring them to market faster will change the way we live.
Carbon has cracked the code on 3D printing at scale. The manufacturing industry is a $12 trillion market and manufacturing polymers is a $330 billion market. There is enormous potential here for Carbon to lead the digital revolution in manufacturing.
Creating a Company Differentiated by its Technology, Business Model and Team
With a team of nearly 500 employees around the world, Carbon has also assembled an impressive team of board members and investors while raising $680 million in the process at a $2.5 billion valuation.
Carbon’s board includes former Chairman and CEO of DuPont, Ellen Kullman, former CEO of Ford Motor Company, and former CEO of Boeing’s Aircraft Division, Alan Mulally, and Sequoia’s Jim Goetz.
Some of their investors include Sequoia, Google Ventures, GE, Adidas, BMW, Johnson & Johnson, and JSR. They’ve also got Fidelity, Baillie Gifford, and Madrone Capital Partners as well as investment from additional international sovereign funds.
Storytelling is everything in fundraising and Carbon was able to master this. Being able to capture the essence of what you are doing in 15 to 20 slides is the key. For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
Critical Ingredients for a Successful Company
During the interview, Joe shared three of the most important components of building a successful company as being:
1. The importance of IP and patent-protection
2. Building highly differentiated technology
3. Assembling a world class team of people that are committed, passionate, and talented
DeSimone also shared his thoughts on the similarities between academia and entrepreneurship such as the importance of bringing people along with you and painting a vision for the future and how the world can be different.
Listen in to the full podcast episode to find out more, including:
I am a serial entrepreneur and the author of the The Art of Startup Fundraising. With a foreword by ‘Shark Tank‘ star Barbara Corcoran, and published by John Wiley & Sons, the book was named one of the best books for entrepreneurs. The book offers a step-by-step guide to today‘s way of raising money for entrepreneurs. Most recently, I built and exited CoFoundersLab which is one of the largest communities of founders online. Prior to CoFoundersLab, I worked as a lawyer at King & Spalding where I was involved in one of the biggest investment arbitration cases in history ($113 billion at stake). I am an active speaker and have given guest lectures at the Wharton School of Business, Columbia Business School, and at NYU Stern School of Business. I have been involved with the JOBS Act since inception and was invited to the White House and the US House of Representatives to provide my stands on the new regulatory changes concerning fundraising online
A novel about who really invented the lightbulb by the screenwriter behind the Oscar-wining film “The Imitation Game.” It features the intertwining stories of Nikola Tesla, Thomas Edison, and George Westinghouse.
When a young Stanford neurosurgeon is diagnosed with lung cancer, he sets out to write a memoir about mortality, memory, family, medicine, literature, philosophy, and religion. It’s a tear-jerker, with an epilogue written by his wife Dr. Lucy Kalanithi, who survives him, along with their young daughter.
Westover, raised in the mountains of Idaho in a family of survivalists, didn’t go to school until she was 17. She would go on to earn a PhD from Cambridge University. This memoir chronicles her path towards higher education.
Online catering marketplace ezCater is not your typical unicorn–if the fact you’ve perhaps never heard its name doesn’t make that readily apparent. Stefania Mallett and Briscoe Rodgers noticed how much catered meals helped sales reps who were trying to woo clients. That realization evolved into ezCater, a 750-employee company that’s now going international.
For one thing, the company is based not in Silicon Valley, but rather in Boston. Its founder isn’t a young man armed with an MBA, it’s Stefania Mallett, a veteran executive who is now 63. Nevertheless, ezCater–an online marketplace for catered meal delivery–is valued at $1.25 billion following a $150 million funding round led by Lightspeed Venture Partners in April. The business has doubled sales eight years running–and if it does so again in 2020, it’ll hit $1 billion in orders.
Mallett has run or been a board member of nearly a dozen organizations, bringing engineering skills–she has degrees from MIT in electrical engineering and computer science–and a customer-focused approach. By the mid-2000s, she was working with co-founder Briscoe Rodgers as CEO of PreferredTime, a company that helped pharmaceutical sales representatives get face time with doctors to pitch their products. One of the most effective ways of doing that, they found, was helping the reps order food to a hospital or doctors’ office.
“Doctors are extremely busy. But what we found was they are also a little too polite to grab the food and run, so they will stand there while you give your pitch,” Mallett says. “It buys you 90 seconds to talk while they are stuffing some food in their face.”
Mallett and Rodgers couldn’t help wondering if a catering platform, one that would help sales reps across industries make delicious meals appear at their would-be clients’ offices, could scale. In 2007, they abandoned PreferredTime and founded ezCater, without a staff or proper office. They each had a Boston-area home; they chose to work out of Mallett’s because her dining-room table was larger.
The founders also envisioned that a platform that connected local restaurants to offer large, shared trays of food–rather than, say, individually packaged sandwiches–would have applications beyond just sales calls. “Turns out, the formula also works for feeding hungry Millennials at tech companies,” Mallett says.
EzCater launched quietly in two test markets, its home of Boston and Greensboro, North Carolina. (The latter was a large enough city to be a legitimate test bed, but small enough that it could let the company fix problems without causing a huge flap.) It wasn’t magic at first, because Mallett and Rodgers needed both sellers–restaurants willing to fulfill large orders–and buyers. “We tried at first to push both those rocks up the hill at roughly the same rate,” Mallett says.
An aha! moment came in the first year. To find customers, first they needed to offer more catering options. They worked fast, and went from just more than 1,000 restaurants on ezCater to some 20,000 in three months. Customers followed. “If you are selling things people want, they will find you,” Mallett says.
National expansion started in 2011, fueled by venture capital investments. To date, ezCater has raised nearly $320 million. The funding also has allowed the company to begin to expand internationally, thanks to acquisitions of a software firm in Vancouver that also ran a catering platform, and a corporate-catering firm in Paris.
Now the company has 750 employees, with about 450 in Boston, 200 in Denver, and the other 100 split between Vancouver and Paris. “We’ve outgrown my house–though I still go home to that house every night and think, yup, it started here!” Mallett says.
Despite the fast growth, the company has tried to develop an easygoing culture based on camaraderie and experimentation. EzCater orders breakfast on Monday and lunch on Thursdays for its Boston staff, using its own platform of course. New hires and interns are tasked with placing the orders, to learn how to use the system–and potentially spot pain points or to help come up with new features.
Growth is still the top metric on Mallett’s mind. She says ezCater issomewhat hesitant to make another acquisition,though, because “virtually all of the companies we are looking to acquire are growing slower than us–so they would slow our growth.” Mallett, who has taken companies public in the past, adds that ezCater could be ready by 2021 to consider an IPO–but with plenty of money in the bank from its past two venture rounds, there’s no pressure to do so.
“Success breeds options,” she says. “We’ve gotten to a place we can make our own choices.”
The short answer for such a massive superyact is, they didn’t really. But that doesn’t mean the experienced owner—who worked with the red-hot superyacht exterior designer Espen Oeino, interior designer Mark Berryman and the highly experienced, megayacht builders at Lürssen in Germany—couldn’t at least try. So, the 450-foot-long, 67-foot-wide yacht was built in the relative secrecy of Lürssen’s enormous manufacturing facility. And the yacht that took several years, and $100’s of millions to build (and probably more than a few non-disclosure agreements) was always referred to by its code name: Project Shu.
But then again, it was extremely hard to keep a yacht that’s much longer than a football field a secret when it finally emerged from the builders covered facility earlier this spring. And even harder once her sea trials on the Baltic began earlier this summer.
And as you can see in the few photos that have finally emerged (it’s now called by its real name—Flying Fox) Espen Oeino has designed an elegant yacht exterior that that looks sleek in spite of her massive over-all volume.
The balance and proportion of the exterior allows for generous deck space that offer a range of options for owners and guests to enjoy. Numerous terraces and platforms open out over the water to provide fantastic access the water. While every other exterior element, from sun decks and open entertainment areas to more shaded and intimate spaces, has been designed to provide the highest level of luxury.
For example, all superyachts have swimming pools, but Flying Fox is special in that its enormous swimming pool that runs from side to side on the main deck. The exterior also is equipped two helicopter landing pads, one on the bridge deck and another on the sun deck aft, that makes it possible to for owners and guests to use multiple helicopters.
Meanwhile, advance reports about the interior (no photos of the interior have been published yet) say interior designer Mark Berryman’s has interior has a calm and spacious feel featuring soft neutral tones and tactile finishes.
And as you can see from what the builder and project manager of this massive yacht said when the yacht was launched earlier this spring, they kept the “secret” going for as long as they could.
“Project SHU represents a major milestone for Imperial.” says Julia Stewart, Director at Imperial Yachts who brought their vast experience and knowledge to their supervision of the massive build project. “Being involved in impressive superyacht projects like these show our capacity and experience in superyacht and megayacht management, with regular deliveries of 80m+ projects supervised and operated by our team since 2015. Our strong and very dynamic links with Lürssen, Espen Oeino and Mark Berryman helped to achieve one of the most impressive vessel of the next decade”
Shipyard Managing Partner Peter Lürssen proudly states: “SHU fulfills the requests of a very experienced owner in an exceptional way. The owner’s input within all aspects of the yacht’s design was clear, strong and exacting. Building SHU was a significant challenge and we are very proud of this achievement. She represents another remarkable milestone in our history.”
But the secret is out now, and tuned for much more from Lürssen and Espen Oeino. The German yard, and Norwegian designer have been very, very busy.
During my previous life as an editor at several American yachting magazines, I was lucky enough to sail thousands of offshore miles on a wide variety of boats. My job as yachting scribe has brought me on adventures from the Arctic Circle to the equator, and to nearly every tropical destination in between. I’ve dodged high-speed hydrofoils on the brown waters off St. Petersburg, Russia, anchored in impossibly blue water off uninhabited islands in the Seychelles, Scandinavia, the BVI, and the Bahamas, and even flown aboard a Jayhawk helicopter with the US Coast Guard on training missions. These days, when I’m not travelling or writing about the magic that happens at confluence of superyachts, offshore adventure, luxury travel, and technology, I sail my ultra-simple, ultra-fast dinghy, ride my gorgeous and gloriously-expensive carbon fiber bike, and push our little one in a baby stroller all over New England.
Gene Berdichevsky was one of the early team members at Tesla. Now he’s building his own unicorn startup, Sila Nanotechnologies, which is valued at over $1 billion. One which looks like it will fuel every way you travel from the road to being in the air.
Berdichevsky recently appeared as a guest on the Dealmakers Podcast. During his exclusive interview, he shared his journey, building his first solar car, and how he’s raised hundreds of millions of dollars for his own technology startup that is growing at an incredible pace.
Thousands of Miles & Designing Your Own Education
He was born on the Black Sea in Ukraine, spent time in St. Petersburg, Russia, and even lived north of the arctic circle for five years. All before landing with his family in Richmond, Virginia, and attending college in California.
Gene was fortunate to grow up in an entrepreneurial family, and see his father start his own small businesses. Both of his parents were software engineers and worked on nuclear submarines.
So, the one thing he says he knew was, “I definitely wasn’t going to be a software engineer.” He did enjoy math and science a lot. That led him to study mechanical engineering.
Within his first year at Stanford, he got involved in their solar car project. Students would compete to build a solar-powered car and race it across the country, 2,300 miles, from Chicago to Los Angeles.
Gene’s team built the car chassis from scratch, built a carbon fiber body, and powered it with a battery with about the same strength as the toaster in your kitchen.
That was it. He fell in love with energy, problem-solving and building, and was really energized by having really built something from the ground up.
Berdichevsky went on to get a Master’s in energy engineering from Stanford. There was really no such program in existence at the time. So, he put together his own curriculum. He dove into materials, semiconductor physics, quantum mechanics, and solar.
Many people are already struggling with the decision to go to university. So, why go, and even create your own studies, when you can piece everything you want to know together online these days?
As with many of the other highly successful startup founders I’ve interviewed who have come out of Stanford, Gene found the network you gain access to very valuable. Some of those people still work for him at Sila today. He also credits the value of learning from your peers there.
Tesla & Battery Issues
At the end of his junior year, Gene became the seventh Tesla employee as a tech lead for battery system architectural development.
It’s no secret that there were plenty of early challenges for Tesla. They started out literally supergluing laptop batteries together to make the battery pack.
Then with safety the main concern was avoiding random failures. They happen in batteries. Even being rare, when you are using 10,000 batteries to run a single vehicle you really have to expect this to happen and preempt that.
Tesla grew from around 10 people when Berdichevsky started there, to around 300 when he left. About 30x in just four years. Tesla now has over 45,000 employees with a market cap of $40 billion.
His big lesson from Tesla was that as a startup founder, you want to go after really big problems. Ironically, Gene says sometimes it is easier to solve a really big problem, than a smaller one. For a start, it enables you to attract incredible talent. It is also both incredibly rewarding and reduces your competition.
From Tesla, he saw that you need to be willing to do things the world doesn‘t think are possible. This requires a mindset and a culture that is self-reliance where you are willing to do a lot of things in house.
Entrepreneurship In The Making
From the day he walked into Tesla, Gene says his brain was already fixated on “How do I start my own company? How do I build something like this?” He had even previously written a business plan for making electric cars in the U.S. market in his junior year at Stanford.
He then did a stint at Sutter Hill Ventures where he understood the VC lens when identifying entrepreneurs that have the potential for success. The key ingredients and how the lens is used to identify patterns includes the following:
1) Great markets defined by a great distribution
2) A strong product that captures the value
3) Founding teams equipped to resolve complex technical problems
Gene was traveling the world meeting many founders. During his time with Sutter Hill Ventures, Gene met his future co-founder, Gleb Yushin. Shortly after, Gene’s former Tesla colleague Alex Jacobs joined them as Sila Nano’s third co-founder.
After multiple conversations and understanding the value that each one of them brought to the table, they got started with a 1,000 sq. ft. lab in a basement at Georgia Tech and Sila Nanotechnologies was born.
Financing The Next Big Thing
Right after forming the team they went out to raise financing. They had a big advantage and that was the intellectual property Gleb had amassed which included six patents and four years of technical data around the problem they wanted to resolve.
They knew the technology was fully compatible and had a clear understanding of the road ahead given the years of experience at Tesla from Gene and his co-founder Alex.
They went out and raised a Series A round with Sutter Hill and Matrix as co-leads. Both of whom have continued investing in every round.
Sila’s most recent round of financing was a $170 million round led by Daimler. So far they’ve raised around $295 million.
The business positioning was critical as a lot of people had lost money in battery companies. From day one they were very clear they were not a battery company, but a technology company that makes materials for batteries. Batteries are a low margin market but the materials have a very healthy market as the better the product the higher the sales.
They are valued now at over $1 billion where storytelling played a big role. This is being able to capture the essence of the business in 15 to 20 slides. For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
During the early days, the cofounders were able to recruit a group of talented engineers to join them and from there started to build the business.
Their business model revolves around inventing, developing, manufacturing and selling their product.
In this regard, their product is a powder that replaces graphite powder in existing lithium-ion batteries. The more efficiently you can store lithium, the less material you need for the same amount of energy. Sila Nano’s material can store energy more densely, giving you more energy at similar volume and weight.
Sila can reduce battery weight by approximately 20 percent or increase energy stores by approximately 20 percent with it’s material. Meaning vehicles have the potential to go 20% further than anyone else’s.
Consider that every electric vehicle will need around 15 to 20 kilos of this material. Think forward to a few years from now when all vehicles are electric. You’re talking about a market of 100 million new vehicles per year. At 20 kilos per car, you’re talking about 2 billion kilos of this entirely new-to-the-world material that has to be produced, every year.
This material could also be used to fuel new air taxis, and change the way we travel, and the aerospace industry.
Sila has been growing by around 40-50% every year for the past five years, and there are no indications of that slowing down anytime soon.
Listen in to the full podcast episode to find out more, including:
The essential ingredients for raising money
Gene’s top piece of advice for his younger self and new founders
How to grow as a leader when your team is growing at 92% in two years
I am a serial entrepreneur and the author of the The Art of Startup Fundraising. With a foreword by ‘Shark Tank‘ star Barbara Corcoran, and published by John Wiley & Sons, the book was named one of the best books for entrepreneurs. The book offers a step-by-step guide to today‘s way of raising money for entrepreneurs. Most recently, I built and exited CoFoundersLab which is one of the largest communities of founders online. Prior to CoFoundersLab, I worked as a lawyer at King & Spalding where I was involved in one of the biggest investment arbitration cases in history ($113 billion at stake). I am an active speaker and have given guest lectures at the Wharton School of Business, Columbia Business School, and at NYU Stern School of Business. I have been involved with the JOBS Act since inception and was invited to the White House and the US House of Representatives to provide my stands on the new regulatory changes concerning fundraising online.
Edgar Sia’s fortunes increased more than fivefold to $475 million since debuting on Forbes Asia’s list of the 50 richest Filipinos in 2011.
Edgar Sia II made his fortune a decade ago feeding the Philippines’ appetite for chicken. Now he stands to make an even larger one feeding China’s appetite for gambling. Sia’s company DoubleDragon Properties spent the last few years building, among other things, office towers along Manila’s once-sleepy waterfront. Sia figured he’d lease the space out to call centers and business process outsourcers, key drivers of economic growth in recent years. He estimated that he could collect about $14 a square meter.
He didn’t count on demand from across the South China Sea. DoubleDragon got its towers up and running just as warming ties between Beijing and Manila sparked a boom in arrivals by Chinese eager to open offshore casinos offering online gaming to countrymen back home where casinos are illegal. DoubleDragon’s Meridian Park complex is a 10-minute drive from Manila’s Entertainment City casino complex. Sia found himself not only among the largest commercial property owners in the area, but the only one with new property to rent.
By the end of last year, tenants were signing leases for nearly $24 a square meter. “We were positively surprised with the outcome,” DoubleDragon’s 42-year-old chairman and chief executive says, with considerable understatement. The boost from offshore China gaming is just part of a property push that’s helping turn Sia from fast-food tycoon into one of the country’s biggest commercial landlords.
Far from Manila Bay, DoubleDragon is building shopping malls, hotels and industrial warehouses in smaller cities across the Philippines. Last year, it tripled net profits to roughly 7.4 billion pesos ($141 million) as revenue more than doubled to 14.3 billion pesos. DoubleDragon’s stock has climbed more than 50% this year. The company is now looking to cash in on its office towers and community malls, package these as a REIT and raise as much as 15 billion pesos via an IPO.
“Most of the baby steps and growing pains happened in the past five years,” says Sia, whose aim is for DoubleDragon to build about 1.2 million square meters of leasable commercial space by the end of 2020. “In just about a year more, the company will already become a strong adult.”
Sia’s own entrepreneurial upbringing began early. While studying architecture in university at the age of 19, he dropped out to lead a group of classmates build a 5-story hotel for budget business travelers, borrowing 40 million pesos from parents and a government pension fund to buy the land and pay for construction. “I was talking to the landowner who didn’t take me seriously,” he recalls. “So I grew a mustache to make me look older.” Sia shaved his mustache. He still owns the hotel.
In 2003 one of the country’s largest shopping mall chains, Robinson’s, opened a new wing in Iloilo offering discounted rents for restaurants. Sia seized the opportunity to launch Mang Inasal, a fast-food chicken restaurant that means “Mr. Barbecue” in the Iloilo dialect. “It was a Filipino comfort food that had not yet been turned into a fast-food fare,” Sia says. “So we created the concept, and then rapidly grew to fill and dominate the gap.”
By 2010, he had grown his barbecue-chicken chain into the country’s second-biggest fast food group, with more than 312 branches, making it bigger than McDonald’s. He sold 70% to rival Jollibee Foods for 3 billion pesos and earned a spot as the youngest member of Forbes Asia’s 2011 list of the Philippines’ 50 richest with a fortune of $85 million when he was just 34 (Sia sold his remaining 30% of Mang Inasal in 2016.) He was No. 24 on last year’s list with a net worth of $475 million.
Edgar Sia II hopes to open 1,200 MerryMarts, a chain of grocery stores owned by his family, by 2030.
In 2013, he partnered with Jollibee founder Tony Tan Caktiong (No. 6 on the rich list) to found DoubleDragon, which went public the following year. Sia and Tan still own 35% each; Tan still sits on the board as co-chairman. Each owner’s stake is now worth about 21 billion pesos ($402 million). While its Manila Bay investment has proved unexpectedly profitable, most of DoubleDragon’s developments aren’t in Manila at all, but in small towns and cities across the country. It’s there that the company is building 60% of the commercial space it plans to build by 2020.
Sia’s wager is that rising household incomes and improving transport are about to trigger a sea change in the way consumers shop in these second- and third-tier cities. Small, family-owned supermarkets and shopping centers, he predicts, will give way to nationwide chains whose size gives them leverage over suppliers and lower costs. “Five years ago,” he says, “the top three retail chains accounted for less than 10% of the sales of manufacturers such as Unilever or Nestle. That’s gone up to a third today. In five years, it could rise to 70% to 80%.”
In preparation, Sia is building 100 shopping centers under his CityMalls brand in cities with an average population of only 160,000, each about a tenth the size of malls in bigger cities. The aim, Sia says, is to introduce big-name retail brands such as SM Savemore groceries or Watsons drugstores into these small, but increasingly affluent communities.
By the end of last year, Sia had achieved half his goal by opening 51 CityMalls. The average occupancy rate is already 96%, according to DoubleDragon, helping it more than double rental income last year from commercial and office buildings, to 2.5 billion pesos. International property consultancy Savills projects that CityMalls will account for about 40% of the community mall stock in newly urbanizing areas by next year. Sia says he’s already locked up the best locations in many emerging towns and cities: “Maybe [a competitor] can do it in one or two cities. But can you do it 100 times?”
Sia is also ramping up in the hotel sector where he got his start. DoubleDragon operates the Hotel 101 and Jinjiang Inns budget brands in the Philippines aimed at business travelers and tourists, particularly from China. As of the end of 2018, Sia had two Jinjiang Inns and one Hotel 101, contributing a combined 534 million pesos to DoubleDragon’s revenue. Two more are under construction and DoubleDragon plans to build four more this year and next. Sia is also looking for foreign partners to expand the Hotel 101 abroad.
Building community malls in small towns, Sia says, made him realize there’s also still room for another major grocery chain in the country. So in April, he launched the first branch of MerryMart, a chain of grocery stores owned directly by his family, on the ground floor of DoubleDragon’s Meridian Park complex. His aim is to open 1,200 MerryMarts by 2030. “If we properly prepare and execute,” he says, “MerryMart can still catch up with the large retail players in the Philippines.”
But the Manila Bay investment may be DoubleDragon’s biggest money-spinner. It broke ground on the Meridian Park complex in 2015 and, by the time four of its six towers were completed last year, the company had emerged as the area’s biggest owner of new office space, according to David Leechiu of Leechiu Property Consultants, which helped find tenants for the complex.
Its timing couldn’t have been better. Offshore gaming operators’ share of office space in Metro Manila rose sevenfold in 2018 from 2016, according to Leechiu Property, faster than any other industry. By the end of last year, they accounted for almost 30% of office rentals, tripling from two years earlier.
Most online casino operators favor Manila Bay because of its proximity to Entertainment City, which caters largely to Chinese visitors who become potential customers once they return home. Property values in the district jumped 81% between 2016 and 2018, according to Leechiu, outpacing the 58% rise in Makati, Manila’s financial district.
Sia leased 100,000 square meters in his first four office towers before they were even completed, 60% to online China gaming companies. For now at least, he can virtually name his price, says Leechiu. “The deal that we did [at 1,250 pesos a square meter] is for the last vacant space in the entire Bay area for the next 12 months. The tenants know that, so they grabbed it,” he says.
Not everyone is a believer. Before its recent rise, DoubleDragon’s stock spent three years in a tailspin. One nagging investor concern: Sia is building brick-and-mortar malls in an age of online shopping. Luis Limlingan, managing director at brokerage Regina Capital Market Development in Manila, says retail shops now take up just half of Philippine malls’ leasable space, down from 80% over the past 20 years. That has made DoubleDragon a no-go for some investors. “None of the large institutional local funds invest in it,” he says.
Sia says his malls are well-positioned to absorb the impact of e-commerce in the Philippines. Online buying and delivery of groceries has yet to take off in the Philippines, he says, and “CityMalls are already 75% food and services, and more than 80% of things sold in CityMall retail shops are basic non-discretionary items.” As e-commerce spreads to the smaller cities where CityMall dominates, Sia says, they’ll double as pickup points and fulfilment centers for online stores.
DoubleDragon’s rising rental income is proof enough to other investors. “DoubleDragon’s stock started to recover this year because the assets that were completed so far have started to generate good recurring income,” says Henry Ong, an independent personal financial advisor who follows the stock. And as Sia’s expansion converts into steady cash flow, it may give him a war chest for greater diversification, says Leechiu. “Once he has a scalable recurring income base, it’s so easy for him to use it as a springboard to go to other places. It’s so easy for him to go to other sectors.” Sia’s partner Tan agrees: “[He’s] the type of entrepreneur with unlimited potential. His ability to create new compelling ventures and execute with speed is unparalleled.”
Vail Resorts, a publicly traded operator of ski resorts, announced on Monday it would acquire Peak Resorts for $11 per share, all cash, which is more than double its $5.10 per share closing price, one day prior to the announcement. Peak Resorts operates 17 ski resorts, mostly in the Northeast and Midwest, including Alpine Valley in Ohio and Hunter Mountain in upstate New York.
One major beneficiary of the acquisition: the Sacklers, the family behind Purdue Pharma, the manufacturer of pain drug OxyContin. According to Peak Resorts’ latest annual proxy from October 2018, its largest shareholder is CAP 1 LLC, a company wholly owned by Sackler brothers Richard and Jonathan.
The Sacklers’ nearly 40% ownership stake, which includes preferred stock and stock warrants, is worth about $87 million based on the transaction. Some of the shares are owned by the charitable Sackler Foundation. The Sacklers became investors in Peak Resorts as early as August 2015.
Richard is the former chairman and president of Purdue Pharma. His brother, Jonathan, is a former board member. Nearly every state has filed lawsuits against Purdue Pharma and its owners, including eight Sackler family members, alleging the company caused a nationwide public health crisis around opioid addiction and opioid overdose deaths. One lawsuit alleges that Purdue Pharma had brought in more than $35 billion in revenues since 1995.
The Sacklers, worth an estimated $13 billion based largely on the value of Purdue Pharma, built their fortune primarily through sales of OxyContin, a highly addictive painkiller that has been called by the medical establishment one of the root causes for the nationwide opioid addiction epidemic.
Purdue Pharma owns the patent for OxyContin, and is the only manufacturer of the drug. According to Symphony Health Solutions, a healthcare and pharmaceutical data analytics company, roughly 80% of Purdue Pharma’s sales come from OxyContin. Due to the widespread rise in use of prescription and nonprescription opioids, the U.S. Department of Health and Human Services declared the opioid crisis a public health emergency in 2017.
The family used to be known for being generous benefactors of museums and universities worldwide, but their moniker has lost its luster. The Metropolitan Museum of Art in New York City announced in May it would turn down money from the Sackler family, though it will still carry the family name in the Sackler Wing. In July, the Louvre Museum in Paris reportedly removed the Sackler name from its Sackler Wing of Oriental Antiquities.
Sid Sijbrandij knows a thing or two about building, scaling and even walking away from companies. His current venture is doing over $100 million in revenue and is valued at over $1 billion.
Originally from the Netherlands, Sid Sijbrandiij is now the founder of one of Silicon Valley’s unicorns that is powering the web through developers worldwide. It’s not his first startup rodeo either.
Sid Sijbrandij recently appeared on the DealMakers podcast. During the exclusive interview, he shared his entrepreneurial journey, the process of finding cofounders, bootstrapping versus raising millions, his addiction to fast-growth startups, and many more topics.
Sid Sijbrandi seems to have always had a gift for spotting business opportunities.
During high school, he studied applied physics and management science. He chose a kind of program that blends the benefits of an M.B.A., with getting good at several engineering disciplines.
In his first year at college, he also started his first company.
The idea came from a fellow Ph.D. student that had made an infrared receiver you could use to skip to the next song on your computer (the only thing that played an MP3 song at the time). He started buying these infrared receivers from him and selling them in the U.S. You’d send him an envelope of dollar bills, and he would then send you a printed circuit board.
Ultimately, his two cofounders didn’t agree on growth plans concerning hiring more people. Sid wanted to hire faster, so he didn’t have to spend as much time on it, while his cofounders wanted to optimize for free cash flow. They ended up parting ways amicably.
The Two Most important Things for Launching with Cofounders
Sid has experienced several startups and says his two big takeaways when it comes to cofounding a company are:
1) To be smart with the shares
2) To be sure you and your cofounders are aligned in vision
For example, automatically making everyone an equal cofounder, even if they come in way later in that process, can be a mistake.
Sid says it is important that shares “are aligned with their contribution to the company. It’s very important if you start a company to have vesting of your shares as well.”
This helps avoid the free rides, because if someone leaves with all the equity, then people that need to invest like VCs are going to be like, “Why am I investing for just 50% remaining of the business.”
In the Netherlands, Sid didn’t find the goal of local companies to grow really fast. If you do want to grow a company really fast, he says it is beneficial to be somewhere like the Bay Area, where everyone just assumes that is the goal.
Not just your cofounder, but also your accounts person and your lawyer, and everybody else requires the growth mindset.
Passion for Growth
After graduation, Sid spent a few months at IBM and could have stayed there. He had an interest in strategy consulting, as well as building a recreational submarine.
He made a balanced scorecard of all the different ways to make that decision. One of the criteria being, “Is this a good story to tell in a bar?” He showed his dad who said it was a ridiculous way to decide on your career but was very supportive either way.
So, he called someone interested in a submarine venture. His pitch was, “Look, you should really hire me because I have a job offer from IBM. Otherwise, I’ll start working there, and we both don’t want that.” He got the job.
He built the first onboard computer for the submarine. Today, U-Boat Worx is one of the biggest builders of recreational submarines. If you go on a cruise, and they have a submarine, it’s likely from U-Boat Worx.
Still, after five years, it just wasn’t growing at a pace that kept Sid interested. He then went on to do a part-time stint on an innovation project with the government as a civil servant.
During this time, he really got to know himself, and how fast-growing companies with a continuous string of problems to be solved were what kept him interested.
Funding Your Startup
After starting and selling app store Appappeal, Sid turned open-source software GitLab into a fast-growing venture that is on its way to an IPO in 2020.
He took the proceeds from his previous venture, doubled it in bitcoin, and began bootstrapping GitLab.com.
Sid got the first few hundred signups through an article posted on Hacker News. Then together with his cofounder applied and got into Y Combinator. The race to demo day, where they would present in front of top tier investors, was on.
Compressing their three-month plan into just two weeks, the GitLab team had a highly successful demo day, landing Ashton Kutcher as an investor.
There was so much interest in their seed round, they rolled right into the Series A financing round. They’ve since followed that up with a B, C and D financing rounds, raising a total of $158 million at $1.1 billion valuation.
Today, some of their investors include Khosla Ventures, Google Ventures, August Capital, ICONIQ Capital, 500 Startups, and Sound Ventures to name a few. It doesn’t get much better than that as a hyper-growth startup.
In order to do this, Sid and his team had to master storytelling. This is being able to capture the essence of the business in 15 to 20 slides. For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
Embracing The Remote Work
Sid states they “don’t do in person.“ At Gitlab they encourage having meetings with webcam. They believe there’s something to see in the other person even if it is via video.
To put this into perspective, every day, employees have a company call, and it’s a thing you do with a limited set of people. In this regard, there are about 20 in each group, and they just hangout.
During the group calls there are all types of topics discussed that vary from movies to magazines. Topics are not necessarily work-related.
Sid and his team very much believe that their company is more than just, “Hey your work…”
As part of Gitlab‘s culture, the social interaction plays a key role and they have a lot of ways in which they facilitate this inside the company. Even if this happens remotely.
M&A Made Simple
Recently Sid and GitLab have been very active when it comes to acquisitions on the buy-side. That includes Gitorious in 2015, Gitter in 2017 and Gemnasium in 2018.
When it comes to acquiring companies, they’ve made the process incredibly simple, and are actively looking for more companies to buy.
In this regard, they like to acquire teams that have built a product before. Preferably a team that made a great product, but didn’t get distribution. Especially because typically they shut their existing product down.
To make things easier, they have an acquisition offer page. It even includes a calculator, so you can go online and calculate how much they’re offering.
Listen in to the full podcast episode to find out more, including:
When to pull the plug on your startup
The advantages of SAFE notes for raising money
How GitLab does meetings and culture around the globe
Each year for the past five, Forbes has searched the country for the 25 fast-growing, venture-backed startups most likely to reach $1 billion in value. Graduates include: food delivery service DoorDash, home seller Opendoor, luggage brand Away and synthetic biology company Ginkgo Bioworks.
This year, with the help of TrueBridge Capital Partners, we scoured the country again for budding unicorns. TrueBridge analyzed the finances of more than 150 startups, then our reporters dug deeper. That research caught problems at San Francisco-based Cleo, a parenting app with a troubled workplace and a CEO who lied about her age and background. The company was removed from consideration after our investigation, and its CEO resigned in mid-June. (The full story is here.)
FOUNDERS: Michael Gronager (CEO), Jonathan Levin, Jan Moller
EQUITY RAISED: $53 million
ESTIMATED 2018 REVENUE: $8 million
LEAD INVESTORS: Accel, Benchmark
New York-based Chainalysis makes cryptocurrency investigation software that can shine light on how people use bitcoin, ethereum, litecoin and more. Financial institutions use the technology to screen customers and comply with regulations designed to prevent money laundering, while government agencies such as the Internal Revenue Service and the Federal Bureau of Investigation can identify illicit transactions and investigate alleged criminals. Before teaming up to found Chainalysis, CEO Michael Gronager, 49, cofounded cryptocurrency exchange Kraken, while CTO Jan Moller, 47, built the Mycelium cryptocurrency wallet.
FOUNDERS: Arshan Dabirsiaghi, Jeff Williams; CEO: Alan Naumann
EQUITY RAISED: $122 million
ESTIMATED 2018 REVENUE: $25 million
LEAD INVESTORS: Acero Capital, Battery Ventures, General Catalyst, Warburg Pincus
In 2010, software security analyst Jeff Williams, 52, started dedicating resources at his consultancy, Aspect, to developing a program that would automate software security analysis. In 2014, he and former Aspect analyst Arshan Dabirsiaghi, 36, founded Los Altos, California-based Contrast Security to monitor the code within running apps and directly notify developers of potential vulnerabilities. “The work that previously had to go through security experts now goes directly to developers,” says Dabirsiaghi, now the company’s chief scientist. In 2016, the company brought in an outside chief executive, Alan Naumann, formerly CEO of online fraud detection startup 41st Parameter, to expand the business.
FOUNDERS: Lior Div (CEO), Yossi Naar, Yonatan Striem-Amit
EQUITY RAISED: $189 million
ESTIMATED 2018 REVENUE: $50 million
LEAD INVESTORS: CRV, Lockheed Martin, Softbank, Spark Capital
Cofounders Lior Div, Yossi Naar, and Yonatan Striem-Amit met during their service in the Israel Defense Forces’ elite intelligence unit, Unit 8200, fertile ground for many high-tech startups. While working on cybersecurity in the military, they came up with the idea for Cybereason, a cloud-based cybersecurity platform specializing in continuous monitoring and response to advanced cybersecurity threats. The company launched in 2012, and relocated from Israel to Boston the next year. “You provide value by helping a big organization not to be in the news as someone that gets hacked,” says Div, 41.
FOUNDERS: Paras Chitrakar, Jason Wilk (CEO), John Wolanin
EQUITY RAISED: $13 million
ESTIMATED 2018 REVENUE: $19 million
LEAD INVESTORS: Mark Cuban, Section 32
As a college student at Loyola Marymount University, Jason Wilk, now 34, blew through his budget, collecting overdraft fees. Wilk, an avid “Redditor,” saw that overdraft fees are a common complaint among users. So in 2016, he founded Dave, short for David, who beat Goliath, which Wilk sees as the big banks. The app tracks expenses and warns when a user’s account is in danger of being overdrawn. It hit a nerve: Dave was Apple’s “app of the day” in April 2017, and has been downloaded nearly 10 million times in two years. “Entrepreneurs can keep their ear to the ground for the next idea,” Wilk says. “Any idea that can be Reddit tested is a good place to start.”
FOUNDERS: Blake Murray (CEO), Alex Bean
EQUITY RAISED: $257 million
ESTIMATED 2018 REVENUE: $8 million
LEAD INVESTORS: Insight Partners, New Enterprise Associates, Pelion Venture Partners
Expense tracking service Divvy is taking on Concur and Expensify by offering its budgeting, fraud detection, and spend management tools for free. Instead of charging per user, Lehi, Utah-based Divvy gives businesses custom Mastercards and takes a cut of merchants’ fees to the bank when people make purchases. Founders (and high school buddies) Alex Bean and Blake Murray, both 35, have won over more than 3,000 corporate customers so far, including WordPress, Evernote and Qualtrics.
FOUNDERS: Luis von Ahn (CEO), Severin Hacker
EQUITY RAISED: $108 million
ESTIMATED 2018 REVENUE: $36 million
LEAD INVESTORS: CapitalG, Kleiner Perkins, Union Square Ventures
The world’s most popular digital language-learning tool, seven-year-old Duolingo has 28 million monthly active users. Most use the free version of its gamified courses. Revenue, largely from subscription fees from ad-free Duolingo Plus, is expected to double this year. CEO Luis von Ahn, 39, is a 2006 winner of a MacArthur “genius” grant and a former Carnegie Mellon computer science professor. Before founding Pittsburgh-based Duolingo, he sold two inventions to Google, including reCAPTCHA, the software that spits out the squiggly lines you type to alert a website that you are not a bot. An immigrant from Guatemala City who says learning English transformed his life, he’s driven to offer free language education to the masses. For our feature on Duolingo, click here.
FOUNDERS: Marcelo Cortes, Daniele Perito, Max Rhodes (CEO)
EQUITY RAISED: $116 million
ESTIMATED 2018 REVENUE: $100 million
LEAD INVESTORS: Forerunner Ventures, Khosla Ventures, Lightspeed Venture Partners, Y Combinator
In a bid to help mom-and-pop stores survive in the age of Amazon, Faire wants to take the risk and hassle out of wholesale purchasing. The San Francisco-based company helps retailers discover and buy new products online, and will accept free returns from them within 60 days for items that don’t sell. Today, it offers 5,000 brands to 35,000 stores. CEO Max Rhodes, a 32-year-old former Square employee, came up with the idea after he started working with a New Zealand-based umbrella brand and spent thousands of dollars to sit at a tradeshow booth to convince U.S. store owners to stock the high-end umbrellas.
FOUNDERS: Dylan Field (CEO), Evan Wallace
EQUITY RAISED: $83 million
ESTIMATED 2018 REVENUE: $3 million
LEAD INVESTORS: Greylock, Index Ventures, Kleiner Perkins, Sequoia
Figma wants to move design online, casting aside the old model of software downloads and siloed creation in favor of a browser-based tool where designers can work and collaborate together. Founders Evan Wallace, 29, and Dylan Field, 27, met at Brown University—Wallace graduated, Field dropped out with a Thiel Fellowship—and launched the San Francisco-based company in 2012. Five years later, Figma started charging professionals to use its product. (Individuals are still free.) Today, professionals pay $12 per editor per month and businesses $45 per editor month to use Figma. More than 5,000 teams, at companies like Microsoft, Volvo, Uber and Square, are users. “Design is like this viral infectant because once your competitor is well-designed, you have to be well-designed, otherwise you’ll be disrupted,” says Field.
FOUNDERS: Arun Chandrasekaran, Matt Elenjickal (CEO)
EQUITY RAISED: $101 million
ESTIMATED 2018 REVENUE: $16 million
LEAD INVESTORS: August Capital, Bain Capital Ventures, Hyde Park Venture Partners
Matt Elenjickal, 37, a logistics geek with an MBA from Northwestern University’s Kellogg School of Management, founded FourKites in 2014 to help companies know where their deliveries are, when they’ll arrive and what’s going on along the way. Its predictive supply-chain management software is now used by more than 260 of the world’s top shippers — and upwards of 500,000 loads per day — including Best Buy, Kraft Heinz, Nestlé and Smithfield Foods. “If you are a shipper, once the truck leaves your facility you have no idea what is happening,” Elenjickal says. “That is how supply chains are run even now without a solution like FourKites. You cannot compete against Amazon.”
FOUNDERS: Mathilde Collin (CEO), Laurent Perrin
EQUITY RAISED: $79 million
ESTIMATED 2018 REVENUE: $16 million
LEAD INVESTORS: Sequoia, Uncork Capital
Mathilde Collin, an alumna of Forbes’ 30 Under 30 list, got the idea for Front while at her first job after graduate school. “I saw how much time was wasted with people sorting through their emails,” she says. So in 2013, she launched the San Francisco-based startup to help companies become more productive with a shared email inbox that incorporates Facebook, Twitter and SMS, and encourages team collaboration. Today, Front has 5,000 customers including Shopify, MailChimp and Stripe.
FOUNDERS: Sung Ho Choi, David Gandler (CEO), Alberto Horihuela
EQUITY RAISED: $145 million
ESTIMATED 2018 REVENUE: $74 million
LEAD INVESTORS: 21st Century Fox, Northzone, Sky
David Gandler, 44, a longtime network sales exec, launched FuboTV in 2015 to tap into pent-up demand in the United States for overseas soccer leagues. FuboTV offered live streams of soccer channels such as GolTV and Benfica TV to start, then expanded programming through deals with beIN Sports and Univision. Today, New York-based FuboTV is generally a cheaper alternative to cable (starting at $54.99 a month) that offers more than 90 channels.
FOUNDERS: Chris Clark, Stuart Landesberg (CEO), Jordan Savage
EQUITY RAISED: $213 million
ESTIMATED 2018 REVENUE: $104 million
LEAD INVESTORS: Bullpen Capital, General Atlantic, Lone Pine Ventures, Mayfield Fund, Norwest Venture Partners, Serious Change
Ask Grove Collaborative CEO Stuart Landesberg, 34, who his typical customer is, and he’ll give you a specific answer: “A 29-year-old mother of two working as a substitute teacher in Lawrence, Kansas.” Even in the age of Amazon, Grove has carved out a $104 million niche in e-commerce by selling natural products, from laundry detergent to sponges, in easy-to-order shipments. Around 60% of its revenue comes from products not sold on Amazon, says Landesberg. But he wants to do more than sell Seventh Generation or Method soaps online. In 2016, Grove started to manufacture its own all-natural products that now make up nearly 50% of its sales. The key? Designing products that are easier to ship. Its glass cleaner, for example, is highly-concentrated and smaller than a tube of toothpaste.
FOUNDERS: Augusto Marietti (CEO), Marco Palladino
EQUITY RAISED: $71 million
ESTIMATED 2018 REVENUE: $5 million
LEAD INVESTORS: Andreessen Horowitz, CRV, Index Ventures, New Enterprise Associates
Kong acts as a gatekeeper to companies’ APIs (code developers use to build apps) and monitors how often they’re used. Augusto Marietti, 31, and Marco Palladino, 30, launched the company out of a garage in Milan, where they both attended university, and were constantly flying back and forth to Silicon Valley to fundraise. “At this stage, we barely had enough money to eat,” Marietti says. “We definitely lost a few pounds when we were first starting up.” Now based in San Francisco, Kong has successfully penetrated the enterprise market with 130 customers that include SoulCycle, Yahoo Japan and WeWork.
FOUNDERS: Jack Altman (CEO), Eric Koslow
EQUITY RAISED: $27 million
ESTIMATED 2018 REVENUE: $7 million
LEAD INVESTORS: Shasta Ventures, Thrive Capital
Lattice founders Jack Altman, 30, and Eric Koslow, 28, learned first-hand the impact of work culture while working at startup Teespring, which sells custom t-shirts. In 2015, they decided to do something about it, starting Lattice. The San Francisco-based company’s human resources software uses surveys to shift the focus of performance management from employee evaluation to career development. Today, Lattice works with 1,300 customers, including Coinbase, Instacart, Slack and WeWork. “Employees are looking for more meaning from work than ever before, and have more visibility into and access to other jobs than ever before,” Altman says. Lattice helps their employers step up.
FOUNDERS: Elton Chung, Lidia Yan (CEO)
EQUITY RAISED: $125 million
ESTIMATED 2018 REVENUE: $46 million
LEAD INVESTORS: Brookfield Ventures, China Energy Group, Sequoia
Cofounded by husband and wife team Elton Chung and Lidia Yan in 2015, Los Angeles-based Next Trucking is moving freight brokerage online. While other startups like Convoy and Uber Freight move cargo from point A to point B, Next Trucking focuses on drayage, or the “first-mile” of transferring goods from port to warehouse. “Drayage is a lot more complicated because it involves terminals and ports,” says Yan, 38. As a result, Next Trucking has doubled revenue every year since 2016, reaching $46 million in 2018. Yan forecasts revenue will hit $120 million this year, helped by large contracts with retailers Dollar General, Rite Aid and Steve Madden. For our feature on Next Trucking, click here.
FOUNDERS: Jack Conte (CEO), Sam Yam
EQUITY RAISED: $166 million
ESTIMATED 2018 REVENUE: $35 million
LEAD INVESTORS: Freestyle Capital, Glade Brook Capital Partners, Index Ventures, Thrive Capital
Musician turned entrepreneur, Jack Conte, 35, wants to break the “starving artist” archetype by helping creators earn a regular income. “Deciding to be an artist shouldn’t have to be a difficult conversation,” says Conte. “It should feel like a viable career choice.” Using Patreon, artists offer exclusive experiences in return for contributions from their subscribers or “patrons.” HBO’s Issa Rae, Humans of New York founder Brandon Stanton and comedian Heather McDonald are some of the creators currently using Patreon and by 2019, the company expects to pay out more than $1 billion to its users.
FOUNDERS: Denis Mars (CEO), Simon Ratner
EQUITY RAISED: $14 million
ESTIMATED 2018 REVENUE: $1 million
LEAD INVESTOR: Kleiner Perkins
The Proxy app is like having a set of keys on your smartphone: Your profile’s signal gives you access to any building where you’re registered, eliminating the need for traditional ID cards and keys. It’s a straightforward idea, but Australian-expat founders Denis Mars, 42, and Simon Ratner, 39, are confident that they’ve just scratched the surface of its potential. So far, San Francisco-based Proxy has proven popular with commercial real estate clients like WeWork. Mars and Ratner now hope to expand their technology (which includes the app, management platform and signal-reading hardware) to identity verification for ride-sharing and event check-in.
FOUNDERS: Ofer Bengal (CEO), Yiftach Shoolman
EQUITY RAISED: $147 million
ESTIMATED 2018 REVENUE: $50 million
LEAD INVESTORS: Bain Capital Ventures, Francisco Partners, Goldman Sachs, Viola Ventures
Israeli tech veterans Ofer Bengal and Yiftach Shoolman set up a fast-database service, in 2011, to help businesses looking to speed up responses on their apps. Redis Labs relies on what’s known as NoSQL, an alternative form of compiling data that is faster than traditional models. That lightening-fast processing speed has helped it sign on FedEx, Mastercard and other corporate behemoths. To scale up quickly, the Mountain View, California-based company offered a free, open-source version to hook developers. In 2013, it rolled out a paid version with costs starting at $5 per month per gigabyte. “You can’t do without open source if you want rapid adoption,” says Bengal.
FOUNDERS: Shivaas Gulati, Josh Hug, Matt Oppenheimer (CEO)
EQUITY RAISED: $312 million
ESTIMATED 2018 REVENUE: $80 million
LEAD INVESTORS: Bezos Expeditions, DFJ Venture Capital (now Threshold Ventures), Generation Investment Management, Naspers’ PayU, QED Investors, Stripes Group
Remitly is taking on Western Union with lower fees — estimated 1.5% on average vs. the money-transfer giant’s 5%. Matt Oppenheimer, who had worked for Barclays in Kenya, and his cofounders launched the business in 2011 to help people in developed nations like the U.S. and Australia send money cheaply to relatives in developing countries like Mexico and the Philippines. Today, Remitly serves 60 countries and processes $6 billion a year in money transfers, about 1% of the nearly $700 billion remittance market. Already one of the largest fintech firms targeting immigrants, the Seattle startup’s long-term goal is to branch out into other financial services, potentially including credit cards, personal loans and auto loans.
FOUNDERS: Xuan Yong (CEO), Mike Witte
EQUITY RAISED: $94 million
ESTIMATED 2018 REVENUE: $21 million
LEAD INVESTORS: Bedrock Capital, Founders Fund, Quantum Energy Partners
There are nearly 1,000 rigs drilling for oil and gas in the U.S. Each well requires the input of dozens of service companies and workers — everything from high-horsepower compressors for fracking, to miles of steel pipe, and millions of gallons of water and truckloads of sand. Cofounder Xuan Yong, formerly of Citadel and D.E. Shaw, believes RigUp can improve on the good ol’ boy network by more efficiently connecting the “hyperfragmented” market of roughnecks, engineers and business owners with the big oil companies that call the shots. RigUp pre-vets workers and vendors, and creams an estimated 4% off every contract made via its online platform. Yong isn’t worried about machines invading the oilpatch. “Even with A.I. there will be demand growth for labor,” he says. “Field tickets are still signed on paper and stamped.” For now.
FOUNDERS: Stephen Hawthornthwaite, Roth Martin (interim CEO)
EQUITY RAISED: $42 million
ESTIMATED 2018 REVENUE: $140 million
LEAD INVESTORS: Goldman Sachs, Lightspeed Venture Partners
Founders Roth Martin, a former art gallery owner, and Stephen Hawthornthwaite (aka “Hawthy”), a former investment banker, launched the footwear brand after listening to their wives complain about the lack of stylish, comfortable shoes. Rothy’s 3D-knitted round-toe and point-toe flats, made from recycled plastic water bottles, have gained cult status. In just three years, it expanded rapidly with direct-to-consumer sales online, reaching revenue of $140 million last year. For our feature on Rothy’s, click here.
FOUNDERS: Phillip Liu, Karthik Rau (CEO)
EQUITY RAISED: $179 million
ESTIMATED 2018 REVENUE: $25 million
LEAD INVESTORS: Andreessen Horowitz, CRV, General Catalyst, Tiger Global Management
SignalFx monitors cloud infrastructure in real time for companies like Yelp, Shutterfly and HubSpot. In 2013, Karthik Rau, 41, who previously worked at tech startups LoudCloud and VMware, founded the company with ex-Facebook software architect Phillip Liu, 51. While competitors collect and query data in batches every two to three minutes, SignalFx evaluates and alerts users to anomalies in two to five seconds. “The difference between getting reliable alerts within seconds and getting them in minutes is the difference of seamlessly dealing with an issue,” says Rau. “Or having all of your users on Twitter complaining.”
FOUNDERS: Paul Dabrowski (CEO), Michael Dabrowski
EQUITY RAISED: $157 million
ESTIMATED 2018 REVENUE: $20 million
LEAD INVESTORS: Founders Fund, 8VC
Gene-editing tool Crispr has unleashed a gold rush for new products made possible by cheaply and easily editing DNA. Synthego is cashing in by selling the genomic equivalent of pickaxes, shovels, maps and other tools. Its ready-made and custom kits allow researchers in academia and the private sector to rapidly develop gene-edited products, including new medical treatments. Its founders, brothers Paul and Michael Dabrowski, 34 and 38, previously worked at SpaceX as engineers and drew on that experience to bring a new way of thinking to biotech.
FOUNDERS: Umar Afridi (CEO), Sid Viswanathan
EQUITY RAISED: $13 million
ESTIMATED 2018 REVENUE: $48 million
LEAD INVESTOR: Initialized Capital
If you buy birth control from Nurx or hair-loss products from Hims, behind-the-scenes pharmacy Truepill will actually fill and deliver your prescription. The three-year-old startup’s founders Umar Afridi, 37, a former retail pharmacist, and Sid Viswanathan, 35, who previously worked at Johnson & Johnson and LinkedIn, see a growing market in bringing technology and efficiency to pharmacy. Although Truepill started with direct-to-consumer brands, it’s now making a bigger play to bring on corporate customers with pricey, specialty medications.
FOUNDERS: Benjamin Bercovitz, Filip Kaliszan (CEO), James Ren, Hans Robertson
EQUITY RAISED: $59 million
ESTIMATED 2018 REVENUE: $20 million
LEAD INVESTORS: First Round, Meritech, Next47, Sequoia
While many startups have tackled the “smart home” with varying degrees of success, Verkada has exploded in shy of two years on the market by offering big businesses, municipalities and schools a cloud-based system that combines hardware and software to detect movement and easily store and share surveillance streams. In 2019, the company founded by three Stanford graduates and the former cofounder of Meraki (a cloud startup since acquired by Cisco) signed on the city of Memphis — a nearly 1,000-camera contract — Juul Labs and Newtown Public School District, the district of the 2012 Sandy Hook Elementary School shooting tragedy.
Additional reporting by Susan Adams, Elisabeth Brier, Dawn Chmielewski, Lauren Debter, Michael del Castillo, Jillian D’Onfro, Christopher Helman, Jeff Kauflin, Alex Knapp, Alex Konrad, Christian Kreznar and Monica Melton
Cover Photographs by Tim Pannell for Forbes | Illustrations by David Wilson