Food For Founders #49 - Q3 Quarterly Update
Here's our third installment of the KnowCap IO Quarterly Update!
|Stephen Alred Jr.||Sep 27, 2019|
First of all...how did we not somehow structure this hiatus so that our Q3 update would be our 50th edition?
Poor planning on my part. Moving on...
It’s the end of the quarter and I wanted to give some updates on what we have been up to over the last three months.
We have a team
I spent hours and hours (probably well over 200 hours) recruiting, onboarding, and offboarding team members for KnowCap. What’s special about this is:
1 We weren’t able to raise outside funding which means everyone is working for the potential of KnowCap, not because they are receiving a salary
2 We needed amazing talent to make sure that the founders work with feel like we have added value - and we got amazing talent
We made our first investment!
We are working with a founder who was passionate about the wedding industry and was struck by her unique insights. Definitely a lot of, “well why have you never been able to book an entire wedding on one application?”
We invest in domain expertise and unique insights. With this one it was so obvious that the concept would win, we just had to bet on the founder and her willingness to let the experts be the experts in building out our piece of the puzzle.
We made our second investment?
There’s a founder in Atlanta that has been in this for the long haul. We used to work in the same space (I didn’t know this at the time) then first started exchanging notes over Twitter early last year after he heard about what I was doing.
Then we began setting up bi-monthly, in-person check-ins to chat about KnowCap and also his company and the insights he was developing there. I told him it was a long-shot because I just had a concept with a lot of research at that point, but whenever I could…I would help him make his company successful.
Fast-forward a few months and some negotiations and we invested in his company. He’s one of those founders that I have no doubt in my mind can take this the distance.
Frankly, I think he’ll get acquisition offers in the next 16-20 months, he’s that compelling as a founder.
We made our third investment????
Because we are human capital investors, it means we don’t deal with the normal constraints of a venture capital firm. While they can only allocate a dollar once, we can allocate one dollar worth of service to work on multiple startups...it allows us to not force founders how they want to work with us. They tell us what they want and we adapt to their needs.
Our third investment is a revenue-based investment where we deliver services and founders opt to pay us out of their revenues. The criteria for these investments are much different than the first two investments...but like I said, our marketing team can work on all three of them seamlessly.
This company is incorporating a new take on an a agency model and we found that compelling. With their unique insight, they wanted to shift the idea of expensive build-outs by building automated processes.
It was a great Q3. But it was also a hard Q3.
Recruiting and then managing 20 team members, all remote, and all part-time is really difficult. We’ve had to reorganize our internal structure and communications multiple times.
Also, working with founders is difficult. They have an idea in their head of what they want and what they need. When experts come in and hold true to the “why” and the “what”, but change the “how” we get a lot of pushback and that’s why a lot of our applicants did not get accepted into our Atlanta ecosystem.
There are a lot more miles to run in this race. Even though you can look at our quarterly updates as evidence we’re moving quickly, I look at them and think…and we’ll have to replicate this in 8-10 more locations over the next 10 years.
Makes my head spin just thinking about it.
On the flip side, when you think about the impact we’re having. It’s incredible. We are giving founders expert-level support, whereas they would have to pay $50,000-$200,000 for what we’re providing. What we’re working on could completely open up the race for building successful companies at scale. That’s what keeps me up at night.
There’s a lot of lives and communities that we can change for the better.
We’re on our way.