Join the conversation with KP Reddy, the innovative mind behind Shadow Partners, as we unpack the entrepreneur's odyssey from pitching to friends and family to winning over boardrooms of seasoned investors. KP shares his mastery on the transformative power of a well-sold vision and the founder's journey to adapt their storytelling prowess to the rigor of professional investment rounds. Discover how to evolve your pitch, sharpen your entrepreneurial acumen, and magnetize the right mix of employees, customers, and investors that resonate with your startup's evolving narrative.
Join the conversation with KP Reddy, the innovative mind behind Shadow Partners, as we unpack the entrepreneur's odyssey from pitching to friends and family to winning over boardrooms of seasoned investors. KP shares his mastery on the transformative power of a well-sold vision and the founder's journey to adapt their storytelling prowess to the rigor of professional investment rounds. Discover how to evolve your pitch, sharpen your entrepreneurial acumen, and magnetize the right mix of employees, customers, and investors that resonate with your startup's evolving narrative.
You are listening to the Shadow Network with KP Ready, your gateway to innovation and architecture, engineering, construction and real estate, with a sprinkle of startups that are making a difference. In between, check us out on YouTube at Shadow Partners. Never miss a live stream fireside chat or talk that we got going on with the industry's most interesting innovators and leaders. Every single week. You can connect with KP Ready and other innovators in the AEC and CRE industry in the Shadow Partners community. Go to bitly slash Shadow Partners community to learn more. Today. All it takes is a few clicks for you to make a difference. Welcome to the future and welcome to the Shadow Network with KP Ready.
Speaker 2:
All right, welcome back to KP Unpacked. If you're not familiar with what we're doing around here, I am joined today by KP Ready. Hi, kp, hey, good on you, it's going really well today. If you don't know me, my name is Jeff Eccles. I'm a senior advisor here at Shadow Partners. Kp is our founder and CEO and every day KP goes over to LinkedIn and he posts real insights about innovation, about leadership, about technology in the AEC world and beyond. And I have the opportunity every week to sit down with KP and say, hey, what were you thinking when you posted that last week on LinkedIn? So that's the whole premise behind these KP Unpacked episodes. It's a lot of fun for me, I think it's a lot of fun for you, the listener, because you get to understand where KP was coming from the conversations that he was having, the travels that he was on when this thought came to his mind and then eventually made it over to LinkedIn. So if you're not following KP on LinkedIn, go over there. Find KP. Period P Period Ready R-E-D-D-Y. Follow him on LinkedIn because there's a lot of great stuff over there. So you know full transparency to everybody.
Speaker 2:
We talk about this before we get started here. We already picked out a post, but, kp, what we were talking about was, as we're recording this, you posted it yesterday and it starts out. Some founders forget this, so a bit of a reminder A founder's job is to sell employees on their vision, sell customers on their vision, sell investors on their vision. Repeat, while attracting better employees, customers and investors each time. This is the job that you signed up for, so there's a lot of selling on the vision, as you were posting this on LinkedIn. What inspired this post? I know, obviously, there's a whole portfolio of companies under the Shadow Ventures banner and we're kicking off the next cohort of our incubator, which will be, again, a whole group of new founders. But what inspired this particular post, the job being to sell the vision?
Speaker 3:
Yeah, I think part of it has been what's not explicitly said in that is, as a founder, just like you're getting better employees, better investors, better customers, you have to get better. Ie, if you think about let's talk about the maturity of fundraising just because that's what every founder cares about, is fundraising. When you go pitch your friends and family about how you want to quit your job and go start something and they all cobble together $200,000 for you to quit your job and start your startup, they invest that money because they love you, not because they understand anything about the business. They believe in you. They're trying to be supportive. So the bar of your vision is hey, I'm really excited about that. And because they love you your grandmother loves you and she adores that you're so excited about this new endeavor that she strokes you a check for 10 grand. That's what that model is. As long as your family doesn't hate you and you have something interesting, you should be able to raise your friends and family around. Then you get to the next levels.
Speaker 3:
Maybe like your first outside round might be like an angel round. These are not professional investors. They do not have discipline. They almost need better hobbies, but for them it's like you sell them the vision. It's not that different than what you sold your friends and family Except this person, this angel. They don't love you. You've got to spend time to get them to fall in love with you. You have to be strong with the vision. You got to follow up. You got to go have coffees and go to their country club. You got to go. Do all this stuff as long as you have the skill to be likable and continue to sell that vision.
Speaker 3:
I don't know that the vision between a friends and family round and an angel round is that different, other than you have to talk to people that start to fall in love with you, because I talked to a lot of angel investors hey, why do you invest in that deal? Oh, I love the founder. They literally say I love the founder. They'll also say things like I fell in love with the founder. They rarely say oh my God, this thing is going to be a billion dollar company. Oh, my God, this is going to change the way. They rarely, rarely say that. So that's your angel level.
Speaker 3:
So the skills you have to be a little bit better. Now you go raise a seed round from a professional VC like me and I'm going to ask lots of questions. You need to have the answers. But because you don't have revenue, I'm really looking at the problem how much homework you've done and so you have to have a different level of skill sets around that. But then when you graduate from me at seed and you go to series A, you better have it dialed in Like your skill set requirement.
Speaker 3:
If friends and families, kindergarten and angel is second grade and seed is like seventh grade, series A, you're all of a sudden doing your master's degree. There's a massive, massive leap around expectations and what you should know and how you approach it and homework. It's a lot harder and what I see a lot of founders doing is they think that they did a good job with their friends and family and their angel and then they convinced me and Matt or Nick or anyone on my team to invest. Those skills are somehow transferable to the next round and they're not not even close. Same thing with recruiting your buddy that you went to college with on your vision is very different than trying to recruit the former CTO of Walmart to be your co-founder at series A right, and so I think that there's a little bit of resting on laurels Like, oh, we raised around. It's like no, you raised around and you have to keep honing those skills. Or like, oh no, the business is progressing, I have revenue. The numbers will speak for them. The numbers never speak for themselves, right? And if you don't continue to refine your vision, and in a series A, it's okay to say hey, my initial vision was A, but after getting in market and learning some things, I really pivoted my approach a little bit and so my new vision is this that's perfectly fine. Nobody expects you to be super focused. You know like it's. It's a lot. You're allowed for your vision to change along the way.
Speaker 3:
But If you spent 20, 30 hours a week with your friends and family around in 20, 30 hours a week for your friends and family for your angel round, in 20, 30 hours a week for your seed round, you're looking at 40 hours a week for your series A and I think a lot of founders think it gets easier. It doesn't get easier, it gets different and it kind of gets harder because you're dealing with pitching teams. There is a little bit it's Shadow Ventures. It's me, nick and Matt. If one of us gets excited about something, then we do the homework we still pass. It's not like we just have to get excited. We have to get excited and we do some homework and then, if we're still excited, then we get interested.
Speaker 3:
When you get to a series A, you have to pitch an analyst who's a gatekeeper that has to get excited, and telephone the message to a principal or a senior associate that then has to get excited. To telegraph it to the partners and say, hey, are you excited? To get the partner excited. And after all of that it still goes to investment committee and everyone on investment committee a lot of them are seeing it for the first time they have to get excited about it. And so I think a lot of people just think, well, it's almost like I got my seed round, it's almost automatic I'll get my series A if I hit numbers. It's not the case. So where that stemmed from is if you think about, as a founder, how hard you work to raise your first outside money to quit your job, it's that much harder and gets that much harder.
Speaker 3:
I was out with some friends of mine from Salesforce and they were talking about the activist investors at Salesforce that went after Benioff. He's still dealing with his investors. He's still working his butt off for his investors and they're huge and he's a billionaire. I think he owns an island. It turns out when you own an island, you still have to cater to investors and have your story and react and be that much better. It makes you a better CEO and it kind of comes back to, I think, previous post-MAs. Just remember you're a founder, you're not yet a CEO. I have a title You're learning how to be a CEO. So this idea that because you raised around you're still a founder, you're not a CEO. Go download a job description of a CEO and tell me if you are an expert of every bullet point that's in the CEO job description and very few founders are. Very few founders are actually CEOs. They're learning how to be CEOs.
Speaker 2:
One thing that I think is interesting in the way that you phrased it here on LinkedIn again, sell employees on their vision, sell customers on their vision, sell investors on their vision. You mentioned vision a lot, and then you talked about the numbers. Rarely speak for themselves, things like that. So when I, the founder, as I'm leveling up, like you said, I love that these skills are not transferable, it's not a horizontal thing. We're leveling up and leveling up from friends and family to angel, to seed to a, et cetera. We're, you know at what point, or does it ever? Maybe is a question Does it ever tip from vision to something else, or is it always about this vision that's out there somewhere?
Speaker 3:
I think, generally speaking, vision drives a lot of things until you're public, and even then it still matters, right? We've yet to see Tim Cook deliver a product that was not Steve Jobs' idea. Apple Vision Pro was not Tim Cook's idea, right? So you're going to default to? Oh, it becomes a value stock, right? What's its dividend? What's its cash flow? But at some point, to continuously grow, there has to be a retrenchment of vision and a strategy to build a great vision. Right, zuckerberg went through a cycle with Meta. Now he's on AI, but look at his stock. Right, he retrenched, didn't get stuck on the Meta vision although he probably shouldn't have changed the company's name and has done an extremely great job as a CEO. Right, and I think Zuckerberg is an interesting example of someone who has stayed CEO, which you find out.
Speaker 3:
There are so many founders that don't make it past Series A. They have to bring a partner in because they just don't have the skills and they're not willing to right, they're not willing to devote 40 hours a week building the company and 40 hours a week raising the next round, which is what it kind of takes, because if you're not good at it already, it takes you 40 hours a week. It's a learning curve. Whereas they say, hey, I'm going to bring in a new co-founder and they're going to go, that's going to be their job Fantastic. The reality is that co-founder that raises the money ends up probably becoming the CEO over time. Sure, but no, I think until you reach a certain point where it's all about the math and the metrics. It is all about the strong vision and same thing with employees, you know. Same thing with employees Until you build that brand of the company that everyone wants to work for. It's hand-to-hand combat. Tell me why I should take a 30% pay cut and come work for you.
Speaker 2:
Yeah, well, I think to that point and you mentioned Steve, or you mentioned Cook, I think about Steve Jobs right, it absolutely becomes about the numbers, right, about the performance of Apple, but at the same time, steve Jobs was still out there, always selling the vision. You know why would I come and work for you? Because of this vision. Vinny Off is out there talking about family right at Salesforce. So, yeah, that's an interesting way to think about it, I think, is you're always going to be selling vision, even when the numbers have to speak. If you joined us and you don't know what we're talking about, I guess it rewind the people does. Anybody still know what rewind means?
Speaker 3:
The back arrow.
Speaker 2:
I mean we do, but KP Reddy and I are talking about a post from his personal account on LinkedIn and, as we're recording it, it was yesterday that he posted this. It says some founders forget this, so it's a bit of a reminder. A founder's job is to sell employees on the vision, to sell customers on their vision, to sell investors on their vision and then repeat while attracting better employees, better customers and better investors each time. This is the job that you signed up for as a founder, and so every week I get to come and ask KP what were you thinking about? What inspired this particular post on LinkedIn?
Speaker 2:
So, if you're not following KP, go over to LinkedIn kperiod, pperiod, ready reddy and just check out what he posts many times, multiple times per day, as he's traveling around, as he's speaking at conferences, as he's doing workshops with CEOs and all the things that KP gets involved with. They inspire those conversations and those experiences and those travels, inspire these posts that he has on LinkedIn. And sometimes they're about founders, because there are portfolio companies that Shadow Ventures has invested in. We do run an incubator, which the new cohort of the incubator will be underway here momentarily, and so this is a post about founders in startup land. So, kp, thanks for joining me and unpacking this post today.
Speaker 3:
All right, we'll see you, Jeff.
Speaker 1:
Thank you for tuning in to another episode on the Shadow Network here with KP ready as always. Remember you can connect with KP and other innovators in the AEC and CRE industry in the Shadow Partners community. Go to bitly slash Shadow Partners community to find out more today. Until next time,