My name is Daniel Alejandro Velasquez Gonzalez and I am the founder and COO of Homefans — a marketplace where fans can connect, plan and book authentic sports trips and experiences hosted by locals.

Our mission is to build the world's leading sports experience platform, connecting people through sports.

I have over 10 years of experience as a founder and operator in the sports and technology spaces.

We started with crowdfunding, then we moved onto angels that we found through referrals from our existing investors. 

The pre-money valuation at the angel stage was $10M. We then moved on to institutional investors. We just closed our seed round in July for around $700k at an $8M cap.

In the past we have raised a total of $850k, excluding this round. That brings a total of $1.5M raised throughout our journey. 

Our marketplace has been growing organically at a very fast pace. Last year we grew GMV 120% so we wanted to raise capital to keep up with that growth. 

We also wanted to add partners who can help us grow faster and fill some skill gaps that our founding team might have.

Our valuation came down from our last round due to the macroeconomic environment so we wanted to stay within range of the previous round’s valuation for the sake of our earlier investors.

Our 2 most important milestones were getting to be cash flow positive - which we are near - and getting to a monthly $110k GMV. 

The goals of being 1) cash flow positive and 2) hitting $110k monthly GMV were milestones we hit before we raised the round. 

This round will be spent on growth (50%), team (30%), and tech (20%).

We had other milestones to hit as far as transaction volume growth, returning customers, and take rates.

Our business overlaps travel and sports. This is an unique combination — we are one of a handful of companies operating at this intersection globally. 

We focused on investors who have value to add on either of those fronts.
We are also a marketplace, which is a very well established business model with investors who understand it very well. Those are a good fit too.

We like to see that the investor gets the idea. Many of the investors that have moved forward in the process with us can see themselves using the product. 

That is the best case scenario.

One of our angel investors is a top expert in marketplace network effects. He has been crucial in getting us introductions to marketplace and consumer tech investors.

We focused on getting warm introductions because those tend to have a higher success rate.

We have reached out to roughly 150 angels and institutional investors. We had more than 50 first-time meetings (33%) — 10% of those converted to investments.

2 main things we have focused on are to have all of the relevant data at our fingertips and getting very good at telling our story.

Most of the investors we have spoken to want to see fresh data. They care a lot about metrics. 

We have a data room we update monthly and a dashboard we share with them so they can keep track of our progress.

Since our team has some first time founders, we work a lot on the Homefans story — the story of Homefans reflects our own experiences — we were the first customers. 

We traveled and wanted to feel more connected to the hometown team, not just like outsiders.

When we pitch we want to show why this team, right now, is the right fit to execute on this business. 

We send out updates to investors — even to those who have said no. We also send updates to investors we have not even spoken to yet. 

This gives them the opportunity to change their mind if they said no before.

This is especially true if your updates include moving forward in the due diligence process with another investor. They often re-engage when they think they might miss out on the deal.

We got very far into the due diligence process with an institutional investor and had to reject their terms outright. 

We had about 14 rounds of diligence calls and we felt that we were spending too much time fundraising and not enough time building the business.

When we finally made it through the diligence process we did not feel the offer was high enough, especially considering our concerns that they might be a difficult partner to work with.

It is very challenging to turn down a large amount of money, even when your business is nearly cash flow positive and growing quickly.

Sometimes when you say no to an investor they never come back. We still felt it was the right thing to do. 

In the end it worked out because they came back later with a much better term sheet — which we accepted.

We took a route that has its pros and cons, which is crowdfunding in the very beginning.

It’s an easy way to get initial customers and funds to get the project started. With a marketplace this can be very helpful in setting off network growth. 

As you grow and add additional more professional investors, this route can complicate your cap table. 

Figuring out who owns what when you have a lot of small early investors can be a real challenge. 

If you have co-founders it is wise to choose one who focuses on fundraising while the other focuses on building the business.

Fundraising can take up a lot of time and there are personalities more suited to it than others. 

I’d recommend Sameer Singh. He’s been a wonderful investor for network effects in marketplaces and opens a lot of doors once you’re in his portfolio.

Try to take advantage of founder meetups or events in your area. They are often the best resource for meeting strategic partners.

I also enjoy Lenny Rachitsky’s podcast and newsletter.