My name is Luis Barrera and I’m the co-founder of Splyt.

I was born in California but have roots in Peru. About 5 years ago, I moved to New York.

I graduated from Chapman University with a degree in finance. Knowing I needed to love what I was doing, I set a 2-year deadline for myself in the finance industry.

When I didn't find it fulfilling, I moved to New York City and encountered a familiar problem: fronting group expenses and chasing people down for repayments, especially after dinners.

This often meant covering large sums out of my pocket and dealing with the discomfort of others who couldn’t split the bill evenly.

To solve this I started a side project. I taught myself to code and built an MVP of an app to address this issue. Eventually I found a co-founder who helped me develop a fully functional version.

Our company’s mission is simple: to make handling money between friends easy, so they can enjoy the moment without any financial awkwardness.

We started with a $25k friends and family check. Then we raised $100k in non-dilutive funding from Google for Startups. 

We also raised from Andreessen's TXO fund, a typical standard YC deal, and raised another $75k from a venture fund. In total, we've raised between $275k and $350k.

The raise was broken up into tranches over about a year. In the beginning I focused solely on building the product and talking to users — following classic YC advice. 

This helped us create a product people wanted but I neglected networking. I didn't attend events or connect with other founders.

The first check from Google for Startups came because I met a partner — that relationship led to the check when they launched the Founders Fund. 

My initial fundraising was all cold outreach.

We received some offers but weren't comfortable with the valuations — so we declined. 

Knowing what I know now, networking with other founders in my industry could have made the process easier.

When we were raising our seed round, our goal was to reach 100k monthly active users. 

This would allow us to achieve a certain amount of average deposits held in accounts, which would cover our banking expenses.

We broke down the unit economics of running a business with a partner bank holding a capacity of assets. 

Our aim was to ensure that the raised funds would at least cover the minimum costs, which would enable us to continue scaling.

A ton of cold outreach — the only way cold emails worked was through hyper-specific, tailored emails, rather than blasting them out to everyone.

The successful ones linked to direct tweets from certain investors.

I would search Google using specific keywords and limit the search to Twitter. I looked for keywords relevant to our industry to see if any VCs had tweeted about them. 

I would then copy and link to that tweet in an email to the VC and quote them directly.

For our pre-seed round, we reached out to around 150 investors. Out of those we actually engaged with around 90 and met with about 30. 

In the end, two invested — Andreessen and another investor came on board.

We showcased our impressive metrics and organic growth. We knew how crowded the bill-splitting app market is — we wanted to stand out. 

We emphasized that we were growing at 16% month-over-month without spending a dime on marketing.

Our retention rate was also a big selling point — people were sticking with us — we had an 8-month retention rate in the high 30s. This was pretty good considering users typically use the app about twice a month.

We also used visual data to make our case more compelling. 

When we met with VCs in New York, we showed them a map highlighting the top 5 places in the city where our app was being used.

This helped them see that our app was not just an idea, but something people were actually using and finding valuable.

We knew investors might be skeptical so we tackled common objections head-on. They often wondered if people were really using the app and if it added value. 

To address this we started charging users toward the end of our seed round and showed our revenue numbers.

This definitely grabbed their attention, although we admitted that our revenue needed to grow significantly to cover our banking partnership expenses.

Showing investors non-obvious insights has really been how they've leaned in and started asking questions.

Oftentimes people think our app is for those who are frugal or cheap, but that’s wrong

It's for people who love credit card points and love getting free flights.

Teaching investors and saying, "Hey, I know you probably think this and that's reasonable, but here's why that's wrong," and then explaining really helped.

Before the Google for Startups check, we were bootstrapped. I decided to go full-time because I saw the potential for growth.

I was renting out a room in my apartment with Airbnb to cover my rent prior to receiving the Google check. 

Google then came in at the last moment; they didn't know we were almost out of money. 

The same thing happened the year when Andreessen's TXO fund came in.

Another challenge was when we couldn't raise the seed this past November — we decided to start charging for the product. 

We only had a couple of months left of runway — we're still alive because we made the decision to monetize.

One of the biggest mistakes I made while fundraising for the first time was taking investors' theses as fact. Investors claim to invest in a certain industry.

When you do the research on Crunchbase, you may realize they haven't cut a check there in a long time. It gives you a map of where you should channel your focus.

Once I started targeting active investors in my space, conversations flowed better.

If they hadn't done a deal in the consumer space within the last 12 months, I wouldn't talk to them.

I take ownership and the blame for this mistake.

Investors who invested in direct competitors, either personally or through their fund, would hop on calls with me — but I hadn’t done the diligence to see that, I only noticed after the fact.

They asked really detailed questions relevant to our product.

After a few of those conversations, I made it a standard to always do my diligence and not to take a meeting until I’d made sure I thoroughly looked into their backgrounds.

Read Ryan Breslow's fundraising book.

Also build relationships sooner. Oftentimes people treat relationships as a one-time, transactional process — the reality is that the process is ongoing. 

The second you decide to become a founder, you should start building those relationships with investors over time.

All the investments I got were through warm intros that I built a relationship with for months.

Keep it simple — just use a Google Sheet. Notion's great, but if you want to send your investor list to them and they don't have a Notion account, they have to sign up to view it.

Think about how you can make it as easy as possible for people to view your fundraising materials.

Another thing that was really helpful was writing an investment memo for investors.

After I got off a first call with an investor, they said they were going to discuss it with their partners. I wrote an investment memo outlining everything we had talked about. 

It saves them time but it also enables me to highlight the things I wanted to emphasize.