My name is Dan Rua, CEO and Founder of Admiral. Admiral is a visitor relationship management company. VRM is a marketing automation or CRM built for media publishers.

Tim Draper wanted to launch an east coast Draper Fund. We launched and did 2 funds. I also launched a third fund of my own.

One of the last companies I did was called Grooveshark in the music streaming space. It was the pioneer of music streaming before Spotify and others. It touched 100M users and 120 employees. 

As it relates to Admiral's story, when we sold off Grooveshark to the record labels, we ended up spinning the core product team out. 

Because Grooveshark was a bit of a known commodity, I became a bit of a known commodity as well, having been in the venture space.

Because of this we were able to raise an institutional seed round in 2016. We ended up raising $7M over a couple of tranches and grew on that over the years. 

Earlier this year, we closed a $19M Series A led by Harbert. This was an equity round with some venture debt on top of that.

We ran stealth for a period of time, building our first MVP. 

Our company started from a problem we noticed at Grooveshark, where music enthusiasts were some of the earliest adblock adopters and how that impacted websites' revenue. 

There were millions of visitors surfing to websites that the websites didn't even realize were there. 

Our MVP was focused on building a prototype that solely solved that adblock problem. In the early days we were in stealth and got our first round of seed funding to go and build the MVP. 

We then grew from there. We knew there was a much bigger opportunity of a privacy user empowerment wave that was reshaping the internet's business model. 

That vision grew us into what we call visitor relationship management, which is everything along the visitor journey, whether it has to do with their ad blocker or email address or subscription or donations or privacy consent.

We were lucky to have Mosley Ventures out of Atlanta to lead the institutional seed round.

The use of the seed funds was to take that MVP and build it out further. We then went to market with the MVP to try to attain PMF.

In a later tranche, we also brought in Capital Broadcasting as a strategic investor. They were a customer of ours. 

Between the seed round and the growth round, we wanted to explore a SaaS debt structure. 

There are SaaS debt providers that will loan against your ARR by giving you non-dilutive funding on some multiple of your ARR. 

We had a very competitive process. We were out at SaaStr. I remember it was a very hectic time, but we ended up with a $2.5M facility with a great partner in Bigfoot Capital out of Colorado.

That non-dilutive funding helped us continue growing ARR, which then set us up for the growth round.

We then decided to proceed with the Series A growth round early this year. Wayne Hunter is the managing partner of Harbert Growth. 

They led the $13M round. On the heels of closing that, we had another debt profiver, Bridge Bank, come in with $6M on top of that.

We were lucky that we were somewhat known and because of that, we could do an institutional seed round instead of the odd angel round

That was at least one of the decision points for us, regarding what kind of investor we’d have on board.

We had trust from past experience with institutional funds that had a thesis on what they were investing in and how they would add value.

I had been investing enough across the southeast that I knew most of the players and so was able to start relationships there. 

I also did a couple seed presentation events. One of the participants in the round was someone that I hadn't met before.

As it relates to the growth round, I did know the Harbert guys for a long time, but that was your typical venture conferences path.

For a long time, we weren't big enough for the growth players. Each year we would check in with each other. 

Even if you're not raising in a given year, checking in to see how their portfolio is doing and giving them an update on what you're doing is great.

By the time you get large enough for their sweet spot, then they already know about you. When you get to that size, it's a productive discussion.

In the seed round, we had a pretty high hit rate. Probably 50% of the folks that we spoke to ultimately came into the seed round. 

On the growth round it was more about building relationships over time so that when we formally went to market we were ready for a good result. Even then, it was probably closer to 10%.

One was the size of opportunity or the problem that’s going on. The way the internet makes money and how it pays for itself is getting massively disrupted right now.

Traditionally it's been about tracking people around the internet and shooting ads to them. Because of this privacy and user empowerment trend, that model is breaking.

Websites have to figure out how to create a one-to-one relationship with the visitor, whether that is an email relationship, a subscription or a donation.

But everything along that visitor journey is about building one-to-one relationships. At the time it simply didn't exist in the media publisher space.

And so we went to build it. The sheer scale of the disruption regarding how the internet is going to pay for itself over the next decade. 

When you have a problem that big, there’s going to be billion dollar companies created on the other side of that disruption. 

The second thing that really nailed it for us was how efficient we were from a SaaS metric standpoint.

We were never a big burn company. Because I had been an investor, we were very focused on the SaaS efficiency metrics

Our efficiency measures really stood out. Every investor we spoke to saw the impressive plethora of metrics which were pretty solid.

Going back to the seed round, we didn't have to do anything artificial to drive urgency. 

For the growth round, we were transparent about the processes and conversations that were happening.

You have to be careful of applying date-related motivation. You can't really do it at the 11th hour. 

You have to do it throughout the process by communicating that you are running an active process.

But you still want to make it clear that you want to partner with that investor, but you're also running a process that needs to get done.

There were many investors that didn't innately understand the disruption that was happening in the business model of the internet. 

We have a model where customers buy certain modules before buying the entire product as a whole. 

Each of our modules are priced a little differently than another. 

We had to spend a little extra time with our investors talking through the pricing model of each module and why that pricing model made sense in the way the customer buys and in relation to the customer's key value metric.

There was education to be done with our investors about our approach from multiple angles.

There’s one that I’ll share that’s a feather in the cap of Harbert. After choosing Harbert, there was another investor who wanted to come in on the deal.

The other investor started to try to chip at some of the terms to try to sweeten the deal a bit. 

In venture circles, sometimes it's just too easy for all investors to fully agree.

It would have been easy for Harbert to bring those guys in on the deal and make the terms slightly worse for us, but they stuck to our original terms 

They said that Harbert was building a partnership with the entrepreneur. They said that if that follower was going to try to change that deal, that follower is not right in this syndicate. 

That really said a lot about Habert. There aren’t many investors who wouldn’t have done that deal. 

Wayne over at Harbert just said, “Dan, what do you want to do here? Harbert stands by their deals, and so what do you want to do”

It’s a really good story of the kind of investors you want around you.

If you’re thinking about using SaaS debt, one of the pros of SaaS debt versus equity is that SaaS debt can fund more incremental growth.

It's very hard to double or triple your team size quickly with SaaS debt, because you have to grow ARR to access more of it. 

If you felt you had product market fit and you had the machine, and therefore you wanted to double or triple your team, then that's more of an equity strategy.

Also, don't make investors do the math. Be willing to educate and understand that they're seeing a thousand deals and so it's your job to make it easy to understand.

Tim Draper used to say, “startups are so hard. No matter what you're focused on it's going to be hard. It's going to be a lot of work so you might as well choose something really big to go after, because it's going to be hard either way.”

If you’re going to be an entrepreneur, make sure you're going after something really big — something that you wake up every morning fired up to build a mission around.

Harbert and Wayne Hunter have been great as I’ve mentioned a couple times. They’re great for the growth round stage. 

If you're talking seed, Sean Ammirati at Birchmere has been a great partner. We had a lot of good partners in that seed round, but if one stuck out, Sean did. 

He’s very knowledgeable about our industry and very willing to roll up his sleeves and help.

I would encourage you to be voracious in consuming as much as possible. 

Regarding SaaS metrics, even though I had already dealt with them so much on the investing side, I still listen to podcasts on the exact same metrics because sometimes there's nuances to a metric that you don't even fully understand at face value. 

A book that we ended up doing a book club on as a company that I really enjoyed was called Winning on Purpose. 

He ended up using the term customer love in his book, which we love because we call our customer success team, the ‘customer love team’. 

The book was all about this idea that the companies that truly want the best for their customer find a way to align themselves with making good things happen for their customer.

They define success as good things happening for their customer and that result in outperforming other companies that don't define things in a similar way.

That sticks with us to this day and it permeates our culture from a customer love standpoint.

You need to bust your tail and put the time in. If you've built a good mission and a good company, it will play out. 

But it will only play out if you put in the effort. You can't wait for someone to come in and be your savior in life. 

Nobody is looking out for you, but yourself so you just need to make sure you make it happen for yourself.