How do you raise an $8M seed from VCs and celebrities?

Jason Kirby (00:02.23) Welcome to episode 16 of Fundraising Demystified, the podcast where we uncover the untold stories of startup founders who have raised capital to bring their visions to life. Join me, Jason Kirby, as I interview these founders and dive into the hidden truths of how they got funded. Today, we have Quaid Walker, an ex-Googler, now CEO and co-founder of Bezel, a luxury watch marketplace that announced their $8 million seed round. Earlier this year from investors like Quartzside Ventures, Kevin Hart, and Steve Aoki. Quaid shares what it's like to raise from celebrity family offices, being intentional about their raise, and why they held off announcing their fundraising until much later, and so much more. Let's go ahead and get started. Thanks for joining us on the show today, Quade. Quaid (00:23.258) Awesome, thanks so much for having me. Jason Kirby (00:25.904) Well, I would love for you to just go straight into just sharing a little bit about you and your background and how that led to you starting Bezel. Quaid (00:33.979) Absolutely. So. First off, Bezel is an authenticated luxury watch marketplace. And I guess the best way to probably start is to go into my background a little bit to kind of walk through how we started it. So my background, I spent most my career at Google. While I was there, I was very much kind of on the product design and product side of the court there. But I was also kind of obsessed with watches while I was there. So my very first bonus that I ever received from Google, I bought a Rolex with it and some would say that maybe it wasn't the most rational decision at the time, but I got to have this really awesome experience of nerding out in the watch space, realizing the very liquid aspect of the space, watching these prices fluctuate and change and I got very hooked to the mechanical nature of the industry. It was such an interesting juxtaposition. to what I was doing every single day, staying at my computer screen, building technology products. And the way that kind of Bezel started for me was, it was such an intimidating process to buy my first watch. I was one of the naive individuals kind of in the early stage of my career where I thought I could walk into a Rolex boutique and just take a bag of money to buy the watch. And in reality, there's massive wait lists for all the pieces that I had wanted. And I was kind of politely ushered out of the door. and pushed into the secondary market. And then once I was in the secondary market, it became this very much shop the seller mentality. It was on me to vet the sellers and who to trust and different collectors gave me different pieces of feedback and there was just generally a lot of distrust associated with a lot of the existing marketplaces at play. My local dealers didn't have what I wanted in stock and I was just so used to buying sneakers and other verticalized products Quaid (02:28.228) like StockX and Goat, that kind of my expectation as a buyer and a product person was how do we build something or something should exist like this in the watch space. So that's kind of what naturally kicked that off. My co-founders and I happened to all be kind of watch and kind of technology adjacent individuals and we kind of jammed on the product from there. And the goal with Bezel was how do you build out a product where you have the vast inventory of the watch world, but everything that I transact on, I know that Bezel is authenticating it and I can trust that aspect of the purchase. So the way that Bezel works is we have just north of 300 million in watches available on the platform today. We are app first, so the goal is to kind of have a really premium product that feels like it's built around the luxury of the products that we are selling and does them justice. Anything that is purchased overnights to us, we have our headquarters in Los Angeles, we It's going through multiple hands. We have a really robust authentication team in house, so they're doing everything from, you know, inspecting multiple touch points of the watch to running it against a time-loss test, a pressure test, or making sure it was never reported stolen. The whole goal is to make sure if you are buying a watch on the platform, you are getting everything that you could expect and more. We then overnight the watch to you, and the goal is, you know, you press purchase, and within three to five days you're receiving the watch. You can put it on your wrist and really what you expected you would buy. Jason Kirby (04:01.288) So I appreciate you giving us context on the brand and the offering and you know something I always like to kind of dive into that I don't always get the opportunity to do so in these stories is you know you have a great kind of origin story of a personal need seeing the opportunity but what about your co-founders? How did you find your co-founders? Did you already have an existing relationship and kind of how did you assemble that original team? Quaid (04:25.262) It's a great question and really happy you asked it because when I talk to founders, it's the thing that I'm most excited about is that we have, I got so lucky with the co-founders that I have in this team and I think that's so important. So it's three of us. One of my co-founders name is Chase Pion. He has very much a finance background and an operational background. He comes from kind of the finance and the hedge fund world. He's also been one of my best friends since I was in third grade. So we have such an interesting complimentary skillset that when I thought about building this business, he was always the person I would call and he would help me validate things and 99.9% of the concepts that we wanted to work on in the past, he would shut down for, of reasons. He was kind of the one that was responsible for the viability from a financial perspective of the business. And he happened, I called him the day I thought about this and it was a very different response. Like he took it very seriously. It wasn't like you're crazy. And we went out and kind of did an analysis in the industry. He happened to have been even more of a watch guy than I was. I didn't really grow up in a family that wore watches. I always thought they were interesting. I grew up surfing and loved having aquatic watches on my wrist to kind of back up that lifestyle. But it wasn't until I kind of got my first meaningful paycheck that I was able to kind of dive into the collecting aspect of watches. Chase, I think, grew up with a background where he always had watch magazines and was obsessed with that. So that's my kind of co-founder on that side. And then Daryl Johnson is our CTO and our third co-founder. Him and I had worked on previous startups together and jammed on things in the past. He was at Google with me so we had built like a really awesome friendship around building products and I think Darrell's superpower is He cares about the product execution as much as he cares about the implementation of it Like he wants to build really beautiful amazing products and that just is so important in the vertical that we are if you're selling luxury the goal is that the product should feel like it represents that and Darrell Quaid (06:41.296) appreciated watches, but I think now seeing it kind of from the belly of the beast, he now has a collection that he's built up. So he's been able to kind of experience it through the product as kind of a new user was, which has been so awesome to see. So I think we're coming at it from all angles where Chase was probably the biggest watch head out of all of us. I was kind of a more, you know, budding enthusiast with a couple of Rolexes and APs and things like that. And Darryl was relatively fresher. So we're able to kind of cover all aspects of the spectrum here at bezel. Jason Kirby (07:11.9) No, it's a great founding story. And I, you know, it's fun to kind of hear those origin stories where you get to work with such a close friend for such a long time. It's not common that skillsets align with friendships that last that long. Quaid (07:24.906) It certainly makes the late nights a lot easier and more fun when you love who you're working with. Jason Kirby (07:30.864) That's fair. Well, let's dive into the meat of it. Let's talk about your fundraise. You announced a $8 million seed raise in early this year, around January, 2022, or sorry, 2023. Tell us about your fundraising journey from what you told me prior to this call as chopped up in a couple of bits and then kind of consolidated into one clean announcement, but kind of walk us through what your strategy was and kind of the timeline of everything when you came from getting that first check to closing out your last check. Quaid (07:59.218) Absolutely. And I think the important thing to mention is that my co-founders, myself, are first-time founders. So we had kind of robust product backgrounds that had launched a lot of things within kind of larger organizations, but this is our first kind of step at doing something larger ourselves. So we were very intentional about a fundraising process. The way that we broke everything out, we closed our first round in August of 2021. We closed that round kind of just as we were segueing out of our... jobs. So it was really, I came from the Google background, had just, I had launched Google TV while I was there and got to see that trajectory of going from, you know, a four person team to a multi hundred person team and an idea on a whiteboard to a product that Google launches. So I understood the life cycle of that, but the fundraising process was incredibly intimidating when you first started that. So the way that we started our process was making sure we Quaid (08:58.256) angel checks to help kind of segue us into a more thoughtful approach to this process. So I had a bunch of folks that I had the pleasure of consulting for or had worked for or had just known in network that had previous exits, had kind of built awesome businesses and just were like really impressive operators. They were our earliest angel checks. And it's the same way that I said I had the concept I called Chase, like my third call after that was one of these operators. And he just said, here's a whatever it was, a 25,000. dollar check, like whatever you're doing, I'm here to support you in doing that. And he kind of segue in all ways, in many ways, quarterbacked a lot of the early stage meetings. So, uh, we ended up raising three and a half in our very kind of first round before we, just as we were segueing away from our business, the way that we structured that round was very intentional. We wanted kind of three types of individuals into that round. We wanted really, really strong seed level. So a lot of our kind of advisors at the time were kind of straged on focused on stage specific venture at the stage, like a fun that really gets seed. So Box Group led the round, as well as kind of Quartzside Ventures and Abstract Ventures. The focus on intentionally like being very seed specific and really understanding kind of the luxury space. The second type of individuals that really cared about were folks that are kind of, you know, setting this new culture of what it means to be a collector for watches. So folks like the John Legends and the Michael Rubens and the Kevin Hart's of the world, and Steve Aoki and Kyle Kuzma and all these big names that are really setting the tone, I think, of what it means to be a modern watch collector. The big data point that we found kind of in the research before launching this business was that 60% of the pre-owned watch market is kind of requested by millennial and Gen Z buyers. And the watch market itself, I think, is decidedly older. So the thinking was how do we leverage these larger name investors to supplant ourselves from a brand perspective to start establishing this narrative that you know we're doing this differently in a little bit of a fresher and more honest take. And then the latter group of folks that we cared about were just really strong watch knowledge. So I think the coolest part about building this business is that I was able to empathize with the first-time watch buyers and that's kind of the ethos of what we were Quaid (11:27.736) trying to build, but in order to kind of have the credibility in the industry, we wanted to have really, really credible dealers, folks like John Reardon or you know, really, really big names in the watch world that have had years of success in establishing their own personal brand to kind of supplant that authenticity that allowed us to unlock some of our earliest hires and really build out the best of the best from the authenticity and watch side internally in the business. Jason Kirby (11:53.956) And what was it like raising money from notable celebrities that, like Kevin Hart and the other ones, Steve Aoki, did you get the chance to kind of meet with them, sit down with them, or was it kind of like a blind check from one of their managers? How did it work out for you? Quaid (12:10.03) It's a great question and we were super lucky that even so in the first round, we were just a pitch deck. We hadn't built anything. And then we had kind of some follow on capital happen a year later, like we had meaningful revenue and we had built that a business. And so the process was a little bit different on either side. But we were super lucky that most of the kind of celebrity or more notable investors in the round, we have a personal relationship with through the round. So the cool thing about our business, I like to always jokingly say, like we're not building something that is conceptually complex to understand. Like a lot of our investors are watch fanatics and they love watches. They felt this pain point of trying to access watches and find watches. So it's super fun to just get in a call with a lot of these folks and just jam on their collecting journey. care about watches and how we can use their voice to continue to kind of perpetuate other folks experiencing watches in a better way. So yeah, most of them, we got introductions through various venture investors, angels, things like that. We got on the phone with most of them and just kind of jammed through what we thought the vision for the business was and it obviously resonated with a good amount of them and we kind of worked on it from there and they've been insanely valuable. last week we're working on kind of a feature we haven't released yet and we wanted to get advice from you know like John Legend and so he's cool enough to get on the phone with us and you know and give his feedback and it's super influential to what we're building and so I think that's been awesome in the sense that like they haven't been totally just like we interact just with their manager or their fund or something most of them roll their sleeves up and actually want to help get involved. Jason Kirby (13:58.304) Yeah, and that's great to hear because in a lot of cases, you know, when you're working with celebrities, they often have to go to the manager or they might get really excited about the investment and they all want to go in and then they're like, I want to write quarter million dollar check and then the manager comes back and says, I will give you 30. So kind of like, you know, did you have to go through the manager? Like what was that kind of experience like? Yeah. Quaid (14:13.518) Totally. Quaid (14:19.934) Yeah, it depends. It depends on a person to person. Also, it's like some of them have funds themselves, right? And so some of them are personal checks, some of them were checks out of their family office, and some of them were checks out of their actual venture fund. And so the process is different for each of those. Obviously, if it's a personal check, it's sometimes the manager involved, but largely it's kind of their decision in making this. And ultimately, they're the ones that's pushing that forward all the way to the other side of the spectrum, the fund, then we're still doing partner meetings, we're still running a process with them. And then kind of the asset of having them on as a fund is not just the fund, but also they wanna get involved and roll their sleeves up and be helpful as well. So it kinda depends. I think we've seen all aspects of that in the sense that we have folks that just jump in and chat with us, we have folks that have a manager that wanna get involved, and we have the fund as well. Jason Kirby (15:17.084) And in your fundraise, so looking at either the celebrities, angels, or the funds themselves, what were some of the friction points? Was it you went out to a couple and you hit it off, or were you constantly grinding, hitting the pavement, trying to get as many meetings as possible? You talked a little bit about who you want on your cap table, but you didn't really talk about how you got them to the table. Quaid (15:36.225) Yeah. Quaid (15:39.478) Totally. So the first kind of go to market with the fundraise, we launched the fundraise in July. Yes. Cause I remember I was thinking about leaving my job to do this from Google and it was around July 4th. So I had some time off to like think about this, right. And I remember we went out to market and July 4th, especially in 2021, when the market was a little bit zestier, I guess is the word I would use. Um, a lot of people were out of town. They were traveling. Like it was not the best time to be raising from people being an office perspective. Um, but we tried, we did our best to run a tight process. We're big fans of that here. So, uh, We took, I would have to say, 70 plus meetings in probably a two to three week period. And the goal being, how do you consolidate as many meetings as possible so that you get as many guesses as possible? So it kind of creates more of an irrational environment where terms are on the table and you have multiple people moving faster and trying to throw terms and allow that to kind of fluctuate your evaluation and get it to a place that you feel better about. So that's how we ran our first process. It went incredibly swimmingly as far as like comparatively to trying to raise money at later stages in different markets. I recognize how lucky we were to raise in 2021. where the, you know, but it's still a roller coaster where you have the first conversations and you hear nos and then you hear maybes and you're waiting on maybes and they become nos and then you hear yeses. And as soon as kind of that first yes turned the table, then it became how do we fit everyone in and how do we get ownership targets and ooh, I really want to have this person, but they want this much and how do we make, how do we save space for this meeting that we have coming up with this other strategic? So I think that was the, the problems that we face, which in retrospect, Quaid (17:33.488) for like very awesome problems to have. When we raised kind of the add-on capital and to explain that a bit more, we raised three and a half in August of 2021. And then we realized kind of, you know, we did everything through a safe. We're big fans of kind of keeping safes open to keep strategics coming in and making sure that if, you know, if someone really interesting wants to be part of the business, like we have a note available for them. We ended up making the kind of of the strategic decision that we didn't want to raise an A yet, that we maybe wanted to bring on a few more strategic partners to help us scale the business. So in kind of end of 2022, we raised six or so million more dollars. And that process was very different. Like the environment was a little bit stricter. The market had certainly turned and it became less of a storytelling discussion and more of a metric driven discussion. was selling the dream, selling the team and our ability to unfairly execute on the dream. And then the later stage was what have we done, why is our product different, and where are we going with it. So I think being intentional about that, the second round took a little bit longer, but we were able to kind of get it done. We focused a lot on strategic, so we kind of led this, we've ended up fusing both of the rounds into one larger seed round, and that's ultimately Jason Kirby (19:03.08) Gotcha. And why did you hold off on the announcement? It sounds like you consolidated kind of all your capital raising and I imagine there's multiple notes over a different period of time as you hit certain milestones, maybe the valuation changed or terms changed. What was kind of your strategic point of consolidating the announcement? Not necessarily the raise, but like the announcement itself. Quaid (19:17.335) Totally. Quaid (19:27.51) So great question. I think there's a planned answer and then there's a more real answer. I think the planned answer was... We wanted to focus on building the foundation of what we were trying to build and leverage the fundraising announcement as a like we've arrived, right? And to put some numbers on that, we, we left our jobs in August. We raised our first round in August. We built and built and built. And it's like, building two sides of the marketplace and logistics of the shipping and the database of watches. Like, so it's a relatively complex product from a scope perspective. So it took us a while to make sure that we were delivering it. What we would say like the bezel quality is. So we ended up ripping off the wait list and, and launching the product in June of 2022. So it took us like almost a year to just be heads down building. We were selling watches in like a closed beta as far as early as January. 2022. But, you know, it was mainly about like, is the FedEx API going to work for us? And like, from an authentication perspective, like our goal was that we only get one shot at absolutely just knocking it out of the park for our customers and making sure that they just absolutely trust us. Because our belief was if we're able to show someone how awesome it feels to buy from us, they will not buy anywhere else. And to make good on that promise, you spend a lot of time iterating internal and scaled. So the thinking was, you know, in January Quaid (21:03.746) of sorry, June of 2022, we'll launch the product and we will also announce fundraising at that point. At that point, we also had the same realization of like, wait, why don't we bring some more capital in while we have this interest? Why don't we get some big names and give ourselves like an unfair advantage? So we ended up pushing out that announcement to January of 2023. Once we got in six or so million more dollars, made a splashier 8 million plus announcement in Bloomberg our real, like we've arrived. And it had a meaningful effect on the business in the sense that, you know, 2023 has been a meaningful growth year. You know, we've had several 50% month over month growth moments in a row, just kind of coming off of that. So yeah, basically it was our kind of kicking through the door, Kool-Aid Man style versus, you know, just trickling out the announcement and not using the hype. Jason Kirby (22:01.008) No, and see, I think that's something important for a lot of founders to realize is, you know, there's a very strategic value add to the business, given your audience, you know, you probably want to get in front of high-networked individuals, high-networked individuals read Bloomberg, Wall Street Journal, these types of things. And so it wasn't just an ego boost, like, yeah, we raised money, which is often majority of fundraised announcements. It was more of a strategic business value add. Quaid (22:16.334) Totally. Jason Kirby (22:29.976) as far as why and when you chose to announce and making sure that you maximize that opportunity and also didn't announce maybe too early when maybe there might have been some kinks or flaws in the user experience. Quaid (22:41.938) Exactly. I think one of our most valuable operator investors from the very beginning challenged us to think about fundraising as a mechanism that gives us an unfair advantage void of the capital. what can we do to leverage our investors to give us press moments? What can we do to leverage our investors to give us buyers, to give us suppliers and like the supply side? So we were very intentional about getting the right people around the right table. That if I heard of another business raising capital and I looked at their cap table and I saw those individuals, I would say, damn, that sucks. Like that's like that's. to get the job done because of this. And so that's the way that we thought about fundraising and the announcement of it versus just getting eight plus million dollars in the door to build the business. Jason Kirby (23:38.346) It's You've mentioned now a couple different points on looking beyond the capital and thinking about who's on your cap table and the impact they can have, why you want them on your cap table, and ultimately that kind of unfair advantage. I think that's kind of a key takeaway for founders here to understand that there's just so much more than money at stake when it comes to raising capital. Jason Kirby (24:08.986) it's usually a deterrent, but when you have a dialogue around this type of strategic value add, the VCs feel like they're going to have more impact, higher potential of return on their investment when they feel they might have a little bit of control. Which leads me to my next question. When you were out in market and raising capital, it sounds like you were leveraging your network, seeing where you can kind of get into. Were you... Quaid (24:23.074) Totally. Jason Kirby (24:34.216) dealing with competing term sheets, were you kind of seeing multiple offers and kind of having to pick and choose who was best for you? Kind of like once you got out there and people were buying what you were selling, from a capital raising standpoint, what was your experience when it came to dealing with term sheets and kind of choosing your partners? Quaid (24:53.782) Totally, I think we had a very short list of folks that we really wanted involved and our strategy to get that done. And I'm a firm believer, I mean, granted, we haven't been fundraising in a little while. So I didn't like this market is potentially a little bit different. I've been hearing that fundraisers are just generally taking longer. And that makes a total of so much sense. But certainly in both the rounds that we've done and guess we fused in one round to the round that we have done, I think the tight process worked for us. And the whole goal of a tight process is to get as many term sheets as possible. in a short period of time so that you have the, like you are in control of the process versus having a term sheet that is kind of going to expire or whatever it is and just like waiting, just like you have less leverage and I think the control is taken out of the founder's hands in that situation. So we certainly had multiple term sheets that. were given to us at the same time and we had to make the decision. I think going back to kind of what you said and what I was saying as well, the decision was easy for us though because We were very intentional about like, we wanted the specific investor to be involved because of the value they provided, which is X, right? Like it wasn't just the capital. And it wasn't just the name. It was, we want to access this type of customer and they have a ton of portfolio companies that are really good in this space and they can connect us with previous operators that can give us an unfair advantage logistically to access. We want to hack supply this way. And these investors are. Quaid (26:42.704) themselves and so they give us an unfair advantage attacking supply like I think being intentional about like the chess move that happens after the capital is in I think makes the decision-making process a lot easier. The other thing too is like I don't think people talk about how stressful that is where the pendulum shifts from, wow, how are we going to get anyone to invest in this business to these are all incredible people. Like how do they, they're in there like calling my phone, trying to invest in this business. Like I don't want to say no, that's crazy. Like how do I, how do I figure out a right path? And we were just really lucky to get the right people around the table. And most, a lot of people got the ownership requirements. A lot of people maybe didn't get the ownership requirements they needed in the first round, came back in the second round and ultimately it kind of made its way out. So yeah, I think the goal is just being very intentional about. what happens outside of the capital and making sure you're working with partners that understand that. And I'm super lucky. All the partners that we have on the investment side are so founder friendly and they're just in our corner and they understood the entire process. They weren't trying to land grab and take as much ownership as they had. A lot of the funds that we're working with, we're realizing that it made a lot of sense for us to hold off a slug of the round to be given to strategic investors because it gave us a better chance of succeeding. they eased up on their ownership targets to allow it to happen and yeah so I had a very pleasant experience with that but I recognize that maybe that's not always the way that it goes. Jason Kirby (28:19.332) And yeah, it really depends. Like a lot of founders that, you know, if there's especially any kind of inflection point or things are really kind of clicking or, you know, just stellar founder team, you know, things can usually go pretty, I would say fair is probably like the right word. And fair is often ideal across the board. When it came to getting those multiple term sheets and you're seeing multiple offers on the table, you kind of mentioned what ultimately led you to your decision, but was there a strong discrepancy in terms of terms or valuations or Lickpress or anything of that sort that you kind of had to sift through? Quaid (28:54.718) Yeah, and I think the two times that we went to market, they're very different, right? Like in 2021, we went to market and, you know, you can imagine like. We were like, people are still in very much like you're getting up 20% of the round, typical kind of dilution targets for rounds type of a thing. And we were able to really protect yourself on dilution and get evaluation that like is decidedly higher than, than you would, than I would think we would have gotten at that stage because. we played the tight process and we didn't jump early. Like it's, I think we got terms that were early that were lower than the terms that we accepted later. And I don't think it had anything to do with the fund. It had to do with like, I think funds were trying to get the best deal for themselves and we were trying to get the best deals for ourselves. And ultimately we ended up meeting in a happy medium to get the job done the way that I think we should have gotten it done. And there was more leeway for that, right? Like I could go back and kind of say, hey, you know, you want to hit your ownership target, maybe instead of doing a million dollars, you do 1.5 and the valuation is higher. Or instead of doing 500 grand, you do a million, whatever. I can have those conversations. And it was just more of, I think, a founder-centric market that we got those done. I think raising in 2022, the conversation was harder and it was more like we had a valuation in mind. We had someone to lead that kind of extent. at that valuation and it became less about trying to walk that up and more about trying to prove that valuation to other really intelligent investors that maybe didn't have the same inside look that the other investor did. So you know it was a lot it was this it was equally challenging but for very different ways and it was you know it's always a roller coaster but it was just you know a different roller coaster. Jason Kirby (30:52.049) And how many VCs do you think you kind of met with or pitched to or kind of sent your materials to over that period of time? Quaid (30:59.134) I mean, we're big fans of taking meetings with anyone that seems like they're interested in the business and excited about it because... Jason Kirby (31:10.964) Thanks for watching! Quaid (31:11.446) The worst thing that comes out of it is oftentimes an intro to someone else or not a great conversation about someone that loves watches. A lot of the, the investors that are in our round or that didn't make it in our round or didn't even want to invest in us for some reason ended up being customers of ours. So that's like a fun thing that we have. Like we are selling a product that in a service that a lot of people in venture tend to really like. colorful, awesome conversations with that. So we've had so many venture meetings, I would say. And when we did our first round. I remember going back and chatting with my friends and family at the time and just being like, whoa, this sucks. Like, I heard five no's today. You're baring your heart out there and you've built the deck and you feel very great about it and you're doing it with your best friends and it feels so great, but then you're hearing no's and you're like, I don't know if we're going to be able to do this. And then I think you just get used to the reality that you're going to hear a lot of no's and you're going to hear a lot of yeses and both are stressful and you have to just you're getting what you want is you're just doing it all again the next day and you're having as many meetings as possible and meeting as many great people I will say A lot of the folks that I thought wouldn't be that valuable have been the most valuable. So I think our outlook is take the meeting, have the conversation. We are very heads down, but there's always extra time in the day to have a great conversation. So I would certainly think that we've had hundreds of venture meetings or investment meetings, whether it's with angels or more institutional funds. Jason Kirby (32:55.796) I'm glad you added some color to that too, because the way you kind of mentioned it sounded like you met with a very specific amount of VCs and they all kind of participated. So I'm glad you added a little bit more color. It was a little bit more of a journey and meeting with lots and lots of different VCs. But like you said, you're essentially selling to customers too. These are, there you go, so it creates a win-win across the board. And so one thing, you kind of mentioned why you did safes. Quaid (33:12.451) Totally. Jason Kirby (33:23.412) and how you've done saves all the way through. So you have not done a priced equity round to this point. So I guess kind of what's that strategy down the road? You know when you know multiple saves getting stacked often the you know can hit pretty hard depending on what those terms are, if there's discounts on those terms and whatnot. You know kind of what are you foreseeing in the future when it comes to doing a price equity round and consolidating those saves? Quaid (33:27.671) We have not. Quaid (33:46.978) Totally. We've been very clean with the safes. It's just based on caps. There's been no discounts or anything applied to any of the saves. From an internal tracking perspective, we have like an internal cap table document and we treat it as if they were price rounds. So I think I've been chatting with other founders about this. I think the aversion to stacking safes is that it's easy to get lost in the sauce and not thinking about the applied dilution associated with all of those saves. And so. I can't even take credit to this. Like my co-founder, Chase, is like an Excel wizard and has a very strict financial background and operationally is very on top of everything and is one of the smartest people I've ever met. So it's just very good at organizing this. And so we're like acutely aware at any point in time where like our dilution stands. Cause I think it's a responsibility as a founder, but also a responsibility to your employees to just make sure you're not being flippant about that. I think the reason why safes is... I think if you're keeping track of them, they are really founder friendly, they are fast, they do not require a bunch of time with your lawyers that's expensive, and they've allowed us to have someone sign a safe and then have the capital in the door within the same week, which is just a huge luxury. I advise and I've consulted for many startups I know that have done recaps and really complicated Quaid (35:19.22) and their employees didn't get, you know, paid out their equity for six months. Like it was a whole convoluted thing, right? So we've been able to preserve that as much as possible and just kind of move really fast and iterate quickly. I imagine the next round will probably be our first price round. kind of when we do more of our institutional A. But I mean, to be honest with you, if we could do it on a safe, I'd probably keep pushing safe. I think it's like, I just think it's optimal for founders to not necessarily always think about fundraising in concrete rounds, but in notes that can be open, as long as like you're very good about tracking those notes and you're not taking on more dilution than you're aware of. Jason Kirby (36:05.864) Well, that's fair. And I think you're smart in the sense of it's not convertible notes, which are a little bit more strict and can be a little hairier, and you avoid discounts. And I think discounts are the point where things get really convoluted, and depending on what your future valuation is. So if you're able to negotiate those terms, which, you know, coming out of 2022, it was, I'd say the end of 2022 must have been a little tougher, but now it's just, you know. those types of things are harder to come by. Diligence is taking a lot longer. So it's not as common to see the stacking of say, for such the larger three, $4 million raises. Typically what I'm seeing is anything over three to 4 million is being now in most cases equity. Quaid (36:52.138) Yeah, that makes sense. Yeah, I think it's certainly subject to when we raised and kind of how we initiated the process at that stage. And yeah, we've just been staying on top of it. But you're totally right. The way that we're structuring our next round in this market. We made sure that we're sitting with, from a runway perspective, way more cash than we need to get to the milestones where we need to get. I once again can't take credit. I like to think I'm conservative around the financial approach, but I think our CFO and my co-founder Chase is even more conservative than I am. So Yeah, like when we're thinking about our next round, the main reason why we brought on even more capital is being aware of the market, wanting to go to market from a metric basis with like just absolutely blowing it out of the water to get the capital we need versus trying to storytell more. And we're in a very privileged position right now where we're hitting the metrics we like that we're hitting. But we don't have to raise until we want to raise. And I think that is the ideal position to be in from a fund perspective. I got on a call this morning with another founder and was just walking through their fundraising process and I think the biggest learning that I've had in the fundraising process is just not under capitalizing the business and I think the dilution that you take is oftentimes between these larger rounds that you have to do and focusing more on just making sure, especially in this market, like you're capitalized for you know 24 months to kind of prove out these things so you have more than six months. to a runway when you're going to the fundraising market. Quaid (38:49.546) I think I might have just lost audio. Yeah, yeah. Jason Kirby (38:53.028) My bad, that was me. So as we come to a wrap here, what's some parting advice that you would like to share with founders that are currently in market, looking at raising some capital? I think that's a good question. Quaid (39:07.402) I think the single best thing we did, I get to, it's stage dependent, but let's assume it's like your first round and you're raising a seed. I think the- best thing we ever did was getting previous operators, really good founders around the cap table as early as possible. Like I'm thinking about this idea, I've put a deck together, what do I do next moment? To me is anyone you know in your network that has run this process successfully and you feel like you're inspired by their career trajectory in the startup world, having them on your side as an angel investor is the best thing that we've done by a mile. And these folks are still our most used advocates in the sense that like when something goes wrong, I guess it depends how wrong, but when something goes wrong, I don't necessarily call the institutional fund that led our seed. I call the operators that maybe had done this before. And if I have a question about payroll or how to hire someone or you know, what to do in this sticky situation or like you want to have, because in fundraising, you're undeniably wants more than I want to give them or I don't know these terms aren't great like is it weird if I bring them in because I really like them and then can I price up another note right after that you get someone else in is that sketchy just having a sounding board of someone that's done it before is invaluable so I think that's probably my biggest point of advice if you're taking into it is don't be afraid like don't just like have eyes for the tier one funds and say like that's where I'm gonna be lobbing my emails like get someone in early Quaid (40:56.98) make the warm intros to all the other funds that you want and try to tear out the process like that. Jason Kirby (41:02.996) I think that's incredible advice. Yeah, essentially it's building not, not thinking of it as a cap table, but a support network of operators that, um, get to partake in the upside with you and are motivated to support you, but also are there to kind of answer those day-to-day questions that in a lot of cases, a lot of VCs haven't been operators or they haven't been for such a long time that their advice may not be as applicable as say, you know, someone that's fresh in it or fresh out of it. Um, so that's. Quaid (41:08.494) Exactly. Quaid (41:29.55) Totally. I think the only other thing that I just thought of while I'm thinking about that, which I love to tell founders too, if there's a way... to get your investors to be your customers, it's like a crazy hack. So if you're a SaaS business and there's large companies that you hope will use your product, if you can get those companies in the very beginning to be bought in on your vision and invest in your seed round, it makes it a hell of a lot easier when you have to talk to them later and say, hey, can you please use our beta as a subscribed customer when you don't have necessarily the product totally want, they're way more inclined to be lenient and forgive you when you're messing up in the early days. If you're a marketplace, can you get your suppliers to be investors? Can you get your buyers to be investors? What can you do to give the flywheel an unfair advantage of spinning fast by getting investors around the table that are going to help you spin it? I think is another fun thing that I've learned that's been really invaluable to us. Jason Kirby (42:36.076) That's some phenomenal advice and I appreciate you being on the show and sharing this input. For anyone that wants to learn more about you or to learn more about Bezel, where should they go? Quaid (42:46.914) Bezel is just getbezel.com or just search Bezel on the app store. We're app first. So if you have an iOS device, download the app. And me personally, I would say probably find me on LinkedIn. It's just my name and I'm super responsive to messages there. Or you can email me at quaid at getbezel.com. I'm not the best at Twitter and Instagram. So those are probably the methods to contact me. Jason Kirby (43:09.736) And just a plug for you and Bezal, you mentioned something very, very beginning of your kind of origin story that I would like to kind of plug here. You used the opportunity to kind of get into the watch game when you got your first kind of substantial check. And I think that's something I've seen founders do when they raised a series A, series, you know, usually series B plus, where they had a little bit of secondary, you know, it's kind of considered a memento or, you know, something to kind of memorize that. or immoralize it. I'm losing my words here, but basically being able to remember that accomplishment and treat yourself is to kind of buy yourself a watch or at that moment buy maybe your co-founders a watch as a way to kind of reminisce on that accomplishment. So I see most of my friends that have sold companies have done the same. They sell a company, they go buy a Rolex or whatever their flavor. So great to have you on the show for the founders. Quaid (43:41.363) I'm sorry. Jason Kirby (44:09.494) But they're in the grind right now, but when they get out and they have some wins, if you're into the watch collecting game or just want to have something nice, a nice piece for yourself, now they know where to go. Quaid (44:20.846) Amazing, yeah, if you're a founder that had a win, congrats on the win and ping our concierge and we'll help you find something. Jason Kirby (44:27.196) Perfect. Well, Quaid, it's been an absolute pleasure having you on the show. I look forward to getting this out to our audience and thanks again for sharing your insights. Quaid (44:34.803) Awesome, so fun, thanks so much. Jason Kirby (44:40.47) That was great.