A thug's perspective on fundraising.

mahbodmoghadamCommunity member
Autoplay OFF  •  2 years ago
Mahbod Moghadam was a Fulbright scholar to France and is a graduate of Stanford Law School. He met Sam Kazemian when he was giving a talk at UCLA, and immediately fell in love with Everipedia. He had planned on retiring because of traumatic brain surgery and a weirdo departure from Genius, his previous company, but Everipedia lured him out of retirement. He asked to be a cofounder and Everipedia family was down.
Mahbod was previously founder of Genius (aka "Rap Genius") which is also cool..
Mahbod has played piano since age 15 - his musical passions include Bach, Beethoven, and Schubert.

A thug's perspective on fundraising.

by Mahbod Moghadam

Everipedia got seed funding from Mucker Capital

<a href="https://www.everipedia.com/muckerlab/">Mucker Capital</a> - which is basically the "<a href="https://www.everipedia.com/ycombinator/">Y-Combinator</a> of Los Angeles" is the best.

We are now raising an angel round.

I remember when <a href="http://rap.genius.com/">Rap Genius</a> was at the same stage Everipedia is at right now, I was scared as shit.

Now, I feel a little bit more chill

Since I've done it before, so I thought I would share my wisdom with YOU.

1. Investors Gotta Use The Product

<a href="https://www.everipedia.com/ashton/">Ashton Mother Fucking Kutcher</a> was the 1st person who invested in Rap Genius after Y-Combinator. Mufucka only has 2500 IQ on the site! WTF Ashton??

The rule for Everipedia investors is:

You need to pledge to become addicted to the site. They need to be like <a href="https://www.everipedia.com/nas/">NAS</a>, also a Rap Genius angel investor, who has 24500 IQ. Big ups Nas The DON!

2. Use Y Combinator SAFE on Clerky

This is the only paperwork you need. Don't hire a lawyer and don't let anyone change any part of it! This is the only acceptable way to raise money. Your valuation should be between $5M and $20M

3. Don't Attempt To Raise Until You Have Massive Traction

Rap Genius had millions of users when we raised money, and Everipedia is about to hit one million monthly users.

4. Make Money As Soon As Possible

I am ashamed that Rap Genius has never monetized; I think the reason is that my ex-cofounder, <a href="https://www.everipedia.com/tomlehman/">Tom Lehman</a>, is a major Zuck wannabe.

I think it's better to monetize ASAP

in order to show investors how that part of the product will look. Everipedia is going to start monetizing with sophisticated ads next month! Swag.

5. Who Cares If The Investor Is Famous?

Rap Genius has all these famous investors - <a href="https://www.everipedia.com/bhorowitz0/">Ben Horowitz</a>, etc. - I don't see how their name helps the company. Money is money.

If anything, a lesser known investor might be more useful

They might be less busy. (<a href="http://genius.com/Bhorowitz">Ben Horowitz has 19K IQ on Rap Genius</a> - so not as bad as Ashton....but not as good as Nas... you feel me?)

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2 years agoReply
@mahbodmoghadam dang that see also is pretty clever man!

2 years agoReply
@lalgsw ad unit is being built right now, it is a "see also" section on every page, here's the shitty prototype of it: https://www.everipedia.co...

2 years agoReply
Hmmm how does Everipedia monetize? Wikipedia seems to just ask for donations all the time

2 years agoReply
@lentis because the site is blowin up as we speak dude! Check the alexa rank, it is 18K right now but it is going up like 500 spots a day! it's crazy

lentisSilver CommaIf there's food, there's me
2 years agoReply
You have 1 mil monthly? That's pretty huge already! People keep saying that fundraising is going to get harder because of the market or something. Why didn't you raise earlier when it seemed like money was easier?

benjSilver CommaStoryteller
2 years agoReply
@mahbodmoghadam thank you for the reply! That makes a lot of sense. Zuckerberg could get money from whoever he wanted to because it was growing so quickly

2 years agoReply
@benji good point, but if your shit blows the fuck up then nobody in the future will care who your past investors were... so I don't think it's that important. I suppose there's a trade-off, but wouldn't it be cool to have a hardcore committed investor vs a busy ass dude?

benjSilver CommaStoryteller
2 years agoReply
Doesn't having big name investors help attract more investors easier/faster? So you can focus more on building things. Kind of a social proof kind of thing?