Each week on The Cap Table (TCT) we highlight investors, operators, founders, and industry leaders in the private markets to share their tribal knowledge of how to get onto “the cap table.” Know someone we should feature? Let us know here!
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We’re thrilled to announce this week’s exclusive with SC Moatti, technology visionary, entrepreneur, and investor!
SC is the founding partner of Mighty Capital, a Silicon Valley venture capital firm, and Products that Count, a global community of product leaders and founders. Previously, she built products that billions of people use during her time at Facebook, Nokia and Electronic Arts. She is also a Lecturer at Stanford Graduate School of Business, where she teaches about early stage investing. With deep cap table knowledge as an operator and investor, we discussed:
The inspiration behind Mighty Capital 🌎
Founder advice: how to build a killer pitch deck ⚡️
The 3-pronged formula for building products people love 💌
Early stage investing: what she tells her students at GSB 📓
Secrets for getting on the cap table ⺇
The state of Product in 2030 🔮
TCT: Thanks for sitting down with us, SC. Let’s jump in.
How did you start out with regards to your career?
I spent a dozen years building products that companies that billions of people use at Facebook, Nokia and Siebel Systems.
Prior to that, I studied engineering and have an MBA from Stanford.
You’re one of the Founding Partners at Mighty Capital, an early growth Silicon Valley venture capital firm. What was the inspiration behind starting Mighty?
Upon leaving Facebook, I started angel investing and I built Products That Count, one of the largest global networks of product managers. We saw a massive increase in deals from our network, and quickly realized there was a greater opportunity to capitalize on this. In 2017, we decided to act on this and launched Mighty Capital.
Given your background as a founder and investor, what advice would you give to founders building their pitch decks? What types of slides or information should they include?
To paraphrase from Mighty Capital’s “Crafting a Killer Pitch Deck”, we look for companies that tell a story by design.
Pitch decks should reads as simple as this:
“We are a unique team, excited to solve a big and hard problem. We came up with a sustainably differentiated solution. As a result, we are gaining solid traction, which we monetize fairly. So our financials look extremely promising but to get there, we need a reasonable amount of funding. We have a credible plan to generate significant returns for our investors.”
To put this story into a slide deck, you can use the following template. Remember your presentation is meant to serve as illustration, not as conversation.
1. Cover slide: Include your logo, tagline, and complete contact information.
2. “We are a unique team,: Highlight the past accomplishments of the team. Selectively include investors and advisors who bring something special.
3. excited to solve a big and hard problem.: Describe the customer, market, and pain points you address. It should FEEL uncomfortable; the numbers are necessary but not sufficient.
4. We came up with a sustainably differentiated solution.: Introduce your solution and its impact. Describe why customers use your product instead of your competitor’s. Also explain why your differentiators are defensible. Briefly describe the technology behind your solution. If appropriate, mention patent.
5. As a result, we are gaining solid traction,: Who are the customers? How are you going to acquire more? What customers have you already acquired? If appropriate, show a pipeline with logos, broken down in conversations > pilots > paying customers.
6. Which we monetize fairly.: What’s your business model? What are the unit economics?
7. So our financials look extremely promising: Ideally, show an exponential revenue line and a linear cost line. Include both past and forecast.
8. But to get there, we need a reasonable amount of funding.: State your ask clearly. If you already have terms and/or commitments, list them. Also include your future funding needs.
9. We have a credible plan to generate significant returns for our investors.”: Show your preferred exit scenario, including time horizon and value. Include 3-5 recent transactions that you believe are comparable to your desired exit.
10. Conclusion: Summarize your story in bullet point format.
Since making the shift to a remote-first culture, what’s been the strongest source for deal flow in 2020 thus far?
Community is key when it comes to sourcing deal flow.
Our best deal flow continues to come from Products That Count, our network of 300,000+ product managers, and from referrals from other investors.
You’re a lecturer at Stanford Graduate School of Business and teach about Early Stage Investing for Individuals. What advice would you give to first time investors?
It’s interesting that the most basic things are often the most effective.
Research has proven time and time again that the more due diligence investors make, the better their outcome. When Mighty Capital decides that a due diligence is appropriate, we ask the entrepreneur(s) to make a data room available to the due diligence team with the information listed below.
· Pitch deck
· Executive team resumes,
· Business plan,
· Sales pipeline or marketing plan,
· Contact of 2 reference customers, 1 key vendor and the lead investor,
· List of top industry associations and trade publications,
· Financial statements (2-yrs back + YTD) and financial projections
· Cap table on a fully diluted basis, including options, warrants and securities,
· Shareholder agreement,
· Term sheets,
· Board meeting minutes,
· IP, including patents, IP license agreements and claims, trademarks, copyrights, and freedom of operations studies and
· Certificate of incorporation.
For more on our due diligence process, check out this resource on our website.
You’ve been praised for your ability to make mobile products that people love. What’s your secret to building mobile products that people love?
The products we use in our everyday lives have become basically an extension of ourselves. So, when we think about what it is that makes great products, we need to consider what it is that makes all of us our best selves. There’s a Product Formula that helps explain this:
THE MIND RULE means that the best products learn as we use them. Humans are learning creatures. We all want to learn and work, and expect our products to do the same.
THE SPIRIT RULE speaks to the fact that we all want to have meaningful lives. We expect our products to give us meaning. That they’ll be personalized, while also maintaining a level of privacy. How you personalize a product is by looking at the information you have access to about your user that allows you to create a unique experience. You also need to protect privacy.
THE BODY RULE is all about beauty. We all want to look good and we expect our products to look good as well. There are two camps on beauty. One is a scientific camp that says beauty is about efficiency. The other one is the artistic camp that says beauty is about ‘wow.’ For us as product managers applying these two key concepts, it's about you being able to build a product that's both efficient, and going to generate an emotional reaction.
You’re also the Founding CEO of Products that Count, one of the largest networks of product managers across the globe. What are the trending topics most product leaders are talking about as of late? What challenges do most product leaders face today and how are they tackling them?
While every product leader has faced their own unique set of challenges this year, members of Products that Count have found strength in the community and each other. Whether it be accelerating a launch date, getting creative for recreating in-person memories or allowing yourself to be vulnerable, product leaders around the globe are finding ways to continue to stay innovative and lead despite the various challenges that the pandemic has brought.
In an effort to share more insight into how our community has coped with these challenges, we recently published an eBook on ways product managers continue to build great products, which you can find here.
You seem like a busy person. How do you structure your days and stay sane?
Ha! I’m an early bird and wake up usually by 5am. I keep a very regular exercise routine, which keeps me sane. My day is mostly back-to-back meetings. My deep thinking happens in the evening when I play with my cat and enjoy family time with my husband, or on the weekends (or in the shower!)
What are you passionate about outside of work?
I like cooking and I sing in a rock band.
You’re an award-winning bestselling author and distinguished writer. What advice would you give to individuals looking to launch their own newsletter in 2020?
Becoming a thought leader is about consistency.
Few people pay attention to a one-off initiative, no matter how great. But, people notice a daily post, or a weekly newsletter, or a consistent presence speaking at events.
It’s a marathon, not a sprint.
Staying true to our brand, we’d love to know: what’s your secret for getting on the cap table?
What gets Mighty Capital into the best deals, including DigitalOcean, MissionBio and Amplitude, is definitely our ability to give our portfolio companies access to 300,000+ product managers. Our CEOs turn product managers into champions for their products, and it really boosts lead generation and sales velocity, resulting in more revenue.
On the flip, what’s your biggest cap table “mistake”?
We invested in a company and a month later, the CEO resigned to take a cushy job at a big company!
The year is 2030. What’s the state of Product?
We believe the 2020 decade is The Age of Product.
So in 2030, we’ll all be using fabulous products we never thought we’d be able to build.
Life and business is going to be easier and more importantly, more fun.
Thank you for your time and thoughts, SC! We look forward to the continued success of you and Mighty Capital!
Deal News 9/12-9/18
Ansa Biotechnologies raises $7,900,000, led by Horizons Ventures | Ansa Biotechnologies develops a novel DNA synthesis technology based on enzymes.
Stemson Therapeutics raises $7,500,000, led by Fortunis Capital | Stemson Therapeutics is a pre-clinical stage cell therapy company.
ShoppingGives raises $5,500,000, led by Caffeinated Capital | ShoppingGives encourages consumers to make an impact through its change commerce technology.
Grin raises $4,300,000 | Grin is a comprehensive digital orthodontic platform providing teeth straightening for all types of patients with a real local orthodontist.
Gravity Sketch raises $3,700,000, led by Kindred Capital | Gravity Sketch is a VR-based design and collaboration platform that allows distributed teams to create, share, and build in 3D.
Biorez raises $3,500,000, led by New York Angels | Biorez is a medical device company advancing tendon and ligament repair.
Demand Sage raises $3,000,000, led by Eniac Ventures, Underscore VC | Demand Sage is a sales & marketing intelligence SaaS solution
BrightHire raises $3,000,000, led by Flybridge | BrightHire is a stealth seed-funded startup with a mission to transform how every company in the world hires.
Finch raises $1,800,000, led by Mendoza Ventures | Finch is a seamless, all-in-one account that provides the benefits of investing with the flexibility of checking.
Neogene Therapeutics raises $110,000,000, led by EcoR1 Capital, Jeito Capital, Syncona Partners LLP | Neogene Therapeutics provides cancer patients with T cell therapies targeting mutated proteins called neo-antigens.
Hexagon Bio raises $47,000,000, led by The Column Group | Hexagon Bio is data-driven biotech developing targeted small molecule therapeutics.
KeepIt raises $30,000,000, led by One Peak Partners | Keepit provides cloud backup and SaaS workload protection services for Office 365, Google Apps, and Salesforce.
Attralus raises $25,000,000, led by venBio Partners | Attralus is a biopharmaceutical company focusing on creating transformative medicines to improve the lives of patients.
SeeQC raises $22,400,000, led by EQT Ventures | SeeQC is a semiconductor company developing commercially viable application-specific quantum computing systems for global businesses.
Bunch raises $20,000,000, led by General Catalyst | Bunch is the first app that lets you play your favorite games with friends over video chat.
JupiterOne raises $19,000,000, led by Bain Capital Ventures | JupiterOne is the security product that is changing how organizations manage their cloud-based infrastructure.
Medefer raises $12,800,000, led by Nickleby Capital | StartupCollective is a website that features informative articles for startups and entrepreneurs.
Air raises $12,000,000, led by Tiger Global Management | Air is a visual collaboration and ideation tool that provides teams a centralized solution for communication and development.
CoreMap raises $10,500,000, led by Qure Ventures | A biotechnology company.
Courier raises $10,100,000, led by Bessemer Venture Partners | The smartest way to design & deliver your product's notifications.
Funding Xchange raises $10,000,000, led by Downing Ventures, Gresham House Ventures | Funding Xchange is a fintech platform that makes finding funding options easy and transparent for businesses.
Dendra Systems raises $10,000,000, led by At One Ventures | Dendra Systems provides integrated analytics and planting solutions for large-scale ecosystem restoration
X1 Card raises $10,000,000, led by Craft Ventures | The smartest credit card ever made.
Narrator raises $6,200,000, led by Initialized Capital | All your data, one table. The new standard for data modeling and analysis.
Escient Pharmaceuticals raises $77,500,000, led by Cowen Healthcare Investments, Sanofi Ventures | Escient Pharmaceuticals is a privately held biotechnology company.
Observe.AI raises $54,000,000, led by Menlo Ventures | Observe.AI is a software company that leverages AI, machine learning, and analytics to develop contact center transcription software.
Volansi raises $50,000,000, led by Icon Ventures | Volansi is a developer of logistics solutions through autonomous drone deliveries that facilitate long-range, time-critical shipments.
Alloy raises $40,000,000, led by Canapi Ventures | Alloy is a developer of an identity verification platform used to detect fraud and make identity management effective and simple for banks.
VanMoof raises $40,000,000 | VanMoof is a developer and designer of urban e-bikes to help commuters get to work without breaking a sweat.
Humatics raises $30,000,000, led by Blackhorn Ventures | Humatics is developing microlocation products that will revolutionize how people and machines locate, navigate, and collaborate.
RapidAI raises $25,000,000, led by Lennertz & Co. | RapidAI uses artificial intelligence to create high quality, advanced images from non-contrast CT, CT angiography, and CT perfusion.
Treez raises $13,000,000, led by Intrinsic Capital Partners | Leading cannabis seed to sale software platform
BrandTotal raises $12,000,000, led by INCapital Ventures | Agile Marketing Intelligence. Uncover your competition's marketing strategy and get the better of them.
Zwift raises $450,000,000, led by Kohlberg Kravis Roberts | Zwift operates an online fitness platform used to transform monotonous solo indoor cycling into dynamic and social adventures.
Infarm raises $170,000,000, led by LGT Lightstone | Infarm builds and distributes highly efficient vertical farms throughout cities to grow fresh produce right in your neighborhood.
Ready Responders raises $54,000,000 | Ready Responders is an on-demand healthcare service company that brings medical care directly to patients in their homes.
nTopology raises $40,000,000, led by Insight Partners | nTopology is a company that develops software used in the design and manufacturing of 3D-printed parts and products.
GoExpedi raises $25,000,000, led by Top Tier Capital Partners | GoExpedi is a leading procurement platform enabling the energy sector to more efficiently procure critical parts and supplies.
eFileCabinet raises $11,500,000, led by Allegis Capital, Signal Peak Ventures | eFileCabinet is an electronic document management solution that helps organizations capture, manage, and protect their data.
Signifier Medical Technologies raises $10,000,000, led by Alan Howard | Signifier Medical Technologies is a medical technology company.
Airtable raises $185,000,000, led by Thrive Capital | Airtable is a cloud-based software company that blends a traditional spreadsheet with a database.
Tonal raises $110,000,000, led by L Catterton | Tonal is a smart home gym that uses artificial intelligence and expert-led coaching to provide strength training.
Finch Therapeutics raises $90,000,000 | Finch Therapeutics is a microbiome therapeutics company that develops microbial therapies.
Devo raises $60,000,000, led by Georgian | Devo is a cloud-native platform developed to support new machine learning technology for data.
Affirm raises $500,000,000, led by Durable Capital Partners, GIC | Affirm is a financial technology services company that offers installment loans to consumers at the point of sale.
Sources: Crunchbase, LinkedIn, Twitter
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