S1|Ep98 Fundraising-as-a-Service - FaaS: How AI is Productizing Venture Capital and Scaling Growth

My amazing guest today is Jeffrey Fidelman from New York, United States.

Jeffrey brings deep expertise in investment banking and startup growth, and we’re diving into:

Fundraising-as-a-Service (FaaS): How AI is Productizing Venture Capital and Scaling Growth

Jeffrey is a part of the Board of Directors of Harvard Alumni Entrepreneurs (HAE), a global community of alumni founders, investors, and executives.

Jeffrey is also part of the Diamond Executive Advisory Council of AI Game Changers Club - an elite tribe of visionary leaders redefining the rules and shaping the future of human-AI synergy.

Jeffrey is the Founder and Managing Partner of Fidelman & Company, a leading advisory firm launched in 2015 to address the critical fundraising and growth strategy needs of early- to mid-stage companies.

Jeffrey’s career began in residential real estate, which led him to the role of Portfolio Manager at Morgan Stanley, followed by Vice President at HSBC, where he drove revenue strategy for Manhattan.

As a seasoned entrepreneur, investor, and advisor with deep expertise in finance and fundraising strategy, Jeffrey has built and supported ventures across multiple industries globally.

🔑 Key topics discussed:

• What Fundraising-as-a-Service (FaaS) is and how it is reshaping venture capital
• How AI is transforming deal sourcing, investor matching, and due diligence
• Which traditional venture capital inefficiencies are likely to disappear first
• How productized fundraising shifts negotiating power between founders and investors
• Why AI and automation are dramatically reducing the cost of raising capital
• The leadership and mindset shifts founders and investors need to thrive
• Whether FaaS will democratize access to capital globally or reinforce existing inequalities
• What will distinguish the winning investors in an AI-driven funding landscape
• What leaders, investors, and business owners must unlearn to succeed
• Jeffrey’s top advice for navigating growth and fundraising in the AI era

🔗 Connect with Jeffrey on LinkedIn: https://www.linkedin.com/in/jeffreyfidelman/
🌏 https://fidelmanco.com/
🌏 https://www.usefundex.com/

Transcript

Welcome And Human Centered Transformation

SPEAKER_00 0:00

Hello and welcome to Digital Transformation NAI for Humans with your host Annie. In this podcast, we delve into how technology intersects with leadership, innovation, and most importantly, the human spirit. Each episode features visionary leaders who understand that at the heart of success is the human touch, nurture in a winning mindset, fostering emotional intelligence, and building resilient teams. My fantastic guest today, Jeffrey Fiedelman from New York, joins me to discuss fundraising as a service. I'm excited to explore how AI is productizing venture capital and driving scalable growth. Jeffrey is the founder and managing partner of Fidelman Company, a leading advisory firm launched in 2015 to address the critical fundraising and growth strategy needs of early to mid-stage companies. His firm is supporting clients across capital rights, business sales, acquisitions, and strategic initiatives all over the world. Jeffrey was elected to the board of directors of Harvard Alumni Entrepreneurs, a global community of alumni founders, investors, and executives. With deep expertise and experience as an interim CFO and COO, Jeffrey has successfully guided dozens of companies through financial transactions, helping them unlock growth, secure capital, and navigate complex market dynamics. Jeffrey's career began in residential real estate, which led him to the portfolio manager role at Morgan Stanley, followed up by the role of vice president at HSBC, driving revenue strategy across banking, lending, insurance, and retail for Manhattan. As a seasoned entrepreneur, investor, and advisor with deep expertise in finance and fundraising strategy, Jeffrey has built and supported ventures across multiple industries globally, helping founders secure capital, scale operations, and navigate growth. I'm honored to have Jeffrey as a part of the executive group of the AI Game Changers Club, an elite tribe of visionary leaders redefining the rules and shaping the future of human AI Synergy. Welcome, Jeffrey. I'm so happy to have you here today.

SPEAKER_01 2:30

Thank you. Likewise, I'm really happy to be here and thank you for the wonderful introduction as well.

SPEAKER_00 2:36

Let's start the conversation and transform not just our technologies, but our ways of thinking and leading. If you are interested in connecting or collaborating, you can find more information in the description. And don't forget to subscribe for more powerful episodes. If you are a leader, business owner, or investor ready to adapt, thrive, and lead with clarity, purpose, and wisdom in the era of AI, I would love to invite you to learn more about AI Game Changers, a global elite club for visionary trailblazers and change makers shaping the future. You can apply at AIGamechangers.club. Jeffrey,

Jeffrey’s Story And Firm Overview

SPEAKER_00 3:15

to start with, I've been waiting for this conversation for quite a while, and I'm so excited to have you here and get a chance to ask you all the questions I have in my mind. So to start with, I would love to hear more about yourself, about your story, about how you came to the point where you are working with these amazing topics. Sure.

SPEAKER_01 3:43

My background in a short form is I graduated at Harvard. I spent almost a decade in banking between Morgan Stanley and HSBC. And I was then asked by a family office to help them run a venture fund. Our focus there was early stage tech and tech enabled companies. We would anchor the round and then help the founders syndicate the rest of the capital, help them raise the rest of the capital. And in 2015, I'd left and I started what is now an investment bank. And since then, we've grown to just under 40 people, all remote, all US and Canadian based. And what we do today is help companies with fundraising preparation, DEX models, valuations, capital structures, things of that nature. And then fundraising execution, which is where we offer a service called fundraised as a service, helping founders and management teams implement best practices in a structure to their fundraise. We have all the databases and subscribe to things like Pitchbook, Dakota, Prequint, Bintrix. We implement a workflow and then layer one of our analysts into it. So effectively building the infrastructure and dropping it into our clients' companies on a month-to-month basis. So that's what we do today. And I'm excited to get into the topics of today's conversation as well.

SPEAKER_00 5:00

So am I. And thank you so much for sharing your story with us. Sure.

Fundraise As A Service Explained

SPEAKER_00 5:06

Jeffrey, FAS is emerging as a new model for capital raising. How do you define it? And in what ways is it set to reshape the future of venture capital?

SPEAKER_01 5:17

In my experience working both in institutional banking and in venture, what became very clear was that there was a significant gap in early and even mid-stage companies when going out to raise capital. And of course, you know, gap. What gap? Many people will say there's plenty of companies raising plenty of money, and it's been done that way for a while. But I meant from a structure and process perspective. You often see a lot of these fractionalized executives, fractionalized services, accounting, bookkeeping, legal, et cetera. And we set out to effectively build, pass, or fundraise as a service where we could own the entire process or top of the funnel of generating investor interest for our clients. With that idea in mind, what we also recognized was that the fundraising space on a services types of offering for early stage companies was entirely misaligned between the broker or banker and the early stage company. When you think about where the relationships and economics lie, engaging with one of these advisors, you're relying on their network and their Rolodex. And what ends up happening is that company A comes to them, they go to John Smith the investor. Company B, John Smith the investor. Company C, Company D, EFG, all John Smith the investor. So what ends up happening is that the advisor is incentivized to maintain a relationship with John Smith the investor and not the company, despite the company paying the advisor to do this work. So what ends up happening is that there's a misalignment of incentives from day one in that type of model. It works a lot better in institutional banking and Morgan Stanley and Goldman and Jeffries and Lazard and kind of mid-market banks because it's more about this deal who is making $50 or $100 million in revenue is getting funded. Let's just figure out who's doing it. Versus at an early stage business, nobody knows anything about the company. You have to go out and forge those relationships. And those relationships that you have to forge must be done between the founder or management team and the investor. Not because there's some banker in between saying, hey, I got this really good deal for you. So when thinking about the space from a philosophical perspective, and that's how it works, that's why we ended up building fundraise as a service, as opposed to building our model after traditional investment banks. Because what we do is effectively build out the structure and infrastructure that we drop into our clients. So I always joke that nothing we do is necessarily proprietary. We've gone out and subscribed to a number of investor databases aggregated kind of internally into one. Our analysts are using those databases to call on investors on behalf of our clients. So Alex calls from ABC Company or Alex emails from ABC.com. So that from the investor's perspective, it's the company that's reaching out to them directly. Our analysts are not meant to be pitching the business of our founders, but rather simply gaining interest and then setting up a call with the founder so that the founder can actually present their business to the investor and start forging that relationship and that bond. Another kind of gap that existed in the market was lack of transparency. And that was due to relationship management of the bankers and also just the process of how they worked. And I go back to when I was at Morgan Stanley, I think Jim Gorman, who was a CEO of the time, came in to give a speech to our class. I was 20, nothing years old. And one of the anecdotes that he shared was kind of, hey, everybody, take out your phones. And if I were to ask you to have a 10-minute conversation with every single person in your phone book, how long would it take you? Let's say two, three weeks, let's say four weeks like this maximum. People are sick, vacations, kids are sick, whatever. And the point that he would convey or was trying to convey was that you should never rely on your own network to get you as far as you think you'll go. Because after 30 days, if people aren't calling you back, they shouldn't be in your phone book. And that's the extent of your network. So too is that of typical advisors. Their relationships are what is valued by the people that are engaging with them, and that's what they're selling. We didn't want to do that because we knew that would only really take us so far over a certain amount of time. So building this out and going back to what I said before, the founders or management teams needing to build a relationship with the investors, that's the entire thesis of Argentiness and why we call it home raised as a service. Others have called it outsource investment relations. We're very, very high touch. We are not opaque and it's totally open. The way that we work is that every week we're not trying to blast out a thousand emails a day or a week. Every week we pull about 100 investors from our database. The analyst assigned to the opportunity will qualify each one individually and then personalize the outreach to every single investor. Meaning, if you were to ask them why did you reach out to so-and-so, to John Smith, to Mary Sue, to whomever, there's a conviction that the analyst has built in why they're reaching out to that investor. Once they've built that personalization, they put that into effectively what looks like a marketing campaign or sequence. Every sequence runs about two weeks. It's a mixture between calls and emails out to that investor. Every week we generate a report for our clients, high-level KPI, how many investors we're sequenced, call connectivity rate, open reply rate on emails. And we also share a list of all of the investors, their personalizations, with our clients. That is their data. There's no reason for us to create this black box of relationships because any data we generate is part of our clients' data. That's who we reached out to on your behalf. And we also meet with our clients on a weekly basis, the analyst, my VP of banking, I'm on those calls at least bi-weekly to make sure that we're not just a service provider, but we become an extension of our clients' teams. It's so incredibly important not only to have worked with them and whether or not we're doing the materials for them, but work with them on their pitches, how they present, what a typical agenda needs to look like, but also to stay in front of all of these communications and interactions. Who is going to be following up with this investor? How did the conversation go? Do we need to adjust our lead targeting internally? Do you need to adjust the way that you're pitching and presenting the business? And that's really the purpose of these weekly reports, kind of from a data perspective, but also the weekly meetings that we have with our clients to make sure that we're staying on top of them raising the capital. So I hope that wasn't too long-winded, but just to give insight in terms of you know our process, which, like I said, not proprietary. These are just best practices of any founder that's raising capital should be doing.

SPEAKER_00 12:11

I absolutely love your vision, and I enjoyed your story because I see how your business can help so many on the market globally in a completely new way. And it becomes quite a transparent collaboration where you are getting a win-win situation, and that's what I like about your approach among everything else you just shared with us. Jeffrey,

Incentives, Transparency, And Trust

SPEAKER_00 12:41

AI is transforming deal sourcing, investor matching, and due diligence. Where do you see the most significant disruption in the fundraising process over the next two to three years?

SPEAKER_01 12:54

I think diligence has the greatest impact, or rather, AI has the greatest impact on diligence from an efficiency perspective in terms of reviewing whether it's K1s on kind of public markets or in private markets around just documentation that a founder or management team is submitting. I do want to spend just a moment on investor matching. A lot of what we do is very manual. And it has been for quite some time. About two years ago, we had the idea of hey, we can make this a lot more efficient. Let's build an AI tool to do a lot of that analyst work around qualification and personalization. So we'll drop in a list to the AI tool. And we built this by the way, we drop in a list to the AI tool, we drop in the details of the company that we're raising for. And the AI tool will then, on a row-by-row basis, go through each investor first to qualify them. Is their investment thesis aligned with the company we're raising for or helping raise? And then we'll create a personalization to say, because you have invested in XYZ, we think you'd be a good fit to take a look at us and to talk to our founder. And the volume that we were able to do was much higher because you didn't have an analyst going on a website, on a LinkedIn, on a pitch book, on going through all those things and actually gaining the data, but the AI was doing it for us. And so too, we started implementing all this infrastructure around like, hey, this is great. We're going to be able to reach out to so many more people. We had this phone service that would dial, like auto-dialer, that would call five people at once. Whoever picked up first would be connected to the analyst, and and volume really increased. But what ended up happening is that efficiency fell off a cliff. I mean, completely like there were very few meetings getting booked, and it just wasn't working. And what we realized was that it wasn't working because the analyst was not able to build conviction around who they were actually speaking to. The moment that they would be connected to an individual investor, they would read off of a sheet that had maybe one, maybe two sentence, rather, maybe two, just one sentence on the personalization. This is why I'm reaching out to you. And then they would fall flat. So first time they saw the investors, the first time they saw the investment company or the fund, and they just didn't have any more content to share with this individual. And that's why our bookings rate dropped off really, really significantly. And we ended up ripping the AI out, going back to manual, spending the last probably year before this past year, we spent creating as much efficiency as we can in a otherwise manual process. And that has worked really, really well for us, and frankly, for our clients that we've we've been able to help raise capital. All of that being said, I think that there is a benefit, and we're we are working on something internally, some sort of better investor matching tool. But I think that at best it becomes a qualification tool and a suggestion engine rather than taking it the full, call it full field to do the personalizations and the outreach itself. I think that there are a lot of companies that are doing that. I've spoken to those companies, I've spoken to customers of those companies and clients of those companies. And I can tell you that it's it doesn't work. It just doesn't work. Every customer is unhappy with the success. They're getting very few meetings because far too often, and and this is this is maybe kind of separate but along the same thread. Far too often, people are more focused on funnel conversion efficiency rather than the efficiency within the funnel. Meaning, I have a funnel for every 100 people I call, I get one meeting. 200 people, two meetings, 300 people, three meetings, one percent conversion, right? People are like, great, I'm just gonna throw as much into the top of the funnel as possible because I'll get my 3% conversion. So 10,000 people, I'll speak to 300. The reality is, though, that people, business owners especially, should be more focused on the actual conversion rate. So you can have a greater efficiency without necessarily doing a greater amount of work. What if I can keep my top of funnel at 100? But instead of getting one meeting, I can get three meetings or five meetings. That's where focus on efficiency needs to be. And that's where I think AI can start to do data analysis and gain efficiencies rather than take apart the entire funnel and say, hey, we're good enough. Let's just jam as much on top of funnel as possible.

SPEAKER_00 17:33

It's interesting that you're mentioning it because exactly earlier today I had a conversation with a business owner who developed an AI solution, which is exactly dedicated to raise conversion rate within the funnel to create a better customer experience. So I couldn't agree more. And as a person who has been in charge in the corporate world for data-driven customer-centric growth, you know, I can absolutely refer to the importance of optimization within the funnel. And to get somebody on the very top of the funnel, it's not the end of the story. Exactly as you mentioned, you have to think about how you can get more for less from there and further on. So thank you so much for pointing it out and sharing more about it. However, this traditional approach is beautiful, but at the same time, there are some inefficiencies and unspoken rules, and traditional VC is full of them. So which of those sacred cows will pass and AI dismantle first?

SPEAKER_01 18:55

I think the landscape of these sacred rules that you're talking about is constantly changing. I think that AI for sure is more of terraforming the landscape rather than anything else. And we'll probably see kind of my anecdotal experience have a butterfly effect throughout the industry in many different forms and formats. But we're seeing a lot of it already, where there's so many companies that came out, were implementing AI, we're laying off 30% of the workforce, and now they're quietly rehiring people back because the AI wasn't as efficient or effective as they thought it would. And to the same effect, I don't feel threatened in any way, and maybe that's a fallacy, and I should be, but more complemented by all these AI tools coming out that are focused around fundraising. And I say that because, on one hand, you want that personal touch and experience, you want someone to be candid with you, you want someone not looking for brownie points, but someone who can tell you the truth about your pitch and not to say, hey, you know, it sucks, no one's going to invest in this, but understand that the person has an idea and how can we work together? How can we talk about the narrative or talk about the deck or talk about the financial model to make this business make sense? And I think at least for now, there is not an AI that can do that, regardless of how much text and experience it could gain from reading or consuming data. I don't think that exists yet today. And I'm not really sure that anyone's going down that path necessarily of having that like real human interaction in terms of like a person telling another person, a founder to a founder, telling them that, hey, from my experience, this has not worked and here's why. And again, you know, I'm sure AI is going to be creeping into that space eventually. I think a large unspoken rule or a large potential reality that exists is kind of this herd mentality around investment. You have a lot of investors saying, hey, you need to find a lead investor. There's probably, you know, a dozen investors that call themselves lead investors kind of through through a true institutional sense, and then everyone crowds behind them. You see a lot of investors between first round Sequoia, Lightspeed, when they invest into a company, you have a lot of other investors and angel investors wanting to come in just based on who the marquee investor name is in that business. And I think with the advent of AI and kind of the adoption of AI, especially around diligence processes and maybe around origination as well, hopefully you will see a greater diversification of investment from a lot of these funds. I think the capital piece is I don't want to say easy, but there's a lot of capital right now on the sidelines looking for where to invest. And you know, to say two words on that is keep in mind an investor's job is to invest money. No fund or professional angel investor makes any money really by raising it and then sitting on it, right? They're really making money by raising the capital and then deploying the capital. So, with that in mind and understanding. That it's just about finding the right person at the right time and connecting them with the right opportunity. Yes, AI can help match a lot of those bits and pieces, but I think the final piece really comes to making that connection between founder and investor, number one. And then from an investor's perspective, looking outside of their bubble that they're usually in. But many will say, you know, why? And I'm playing my own Dell as advocate, why? If I'm making so much money doing what I'm doing, why would I change it? And I think, you know, as globalization hid us 40, 50 years ago in terms of like production and everything else, I think with AI, with remote work, with everything that's going on now with vide coding, we'll see a lot more globalization across the software industry than we have before as well.

SPEAKER_00 22:49

I would like to dig a little bit deeper on that because this is a truly important part.

Where AI Helps And Where It Hurts

SPEAKER_00 22:56

I think so. So by productizing fundraising, the balance between startups and investors is shifting. My question is who gains the advantage in this new system and how might it change negotiations?

SPEAKER_01 23:13

Hopefully, the advantage is to both sides. If you're saying that startups are getting an advantage, really who we're talking about is successful startups. Obviously, that's hindsight, you know, and hindsight is 2020. So we can only know what startups will be successful over the next couple of years. But if it is truly benefiting startups and they are good startups and they can raise better capital, whether it's more cheaper, more impactful capital from operating investors, that ultimately leads to the benefit of investors, also, right? If the startups that they're investing in are growing exponentially, if they are making money for themselves and for their investors, the investors that are putting money into them are also benefiting. So I think it's one of those ideas where if you see a big wave coming, you can either get on it, go through it, but anything else is just going to be a disaster for you. So the same, so kind of the same here to answer your question. Who benefits really from it? I think that there's a further democratization around investment dollars going out. People don't need to be in an office building or in an urban location to find engineers anymore where there's vibe coding platforms out there, like Lovable, for example. And then also remote engineers are becoming more and more prevalent and higher and higher quality across the globe. And we've seen this already for so many years. And I think the biggest roadmap is what vibe coding actually takes care of, whether it's ultimately called vibe coding or it's called something else. But the ability to localize ideation and MVP and then globalize production drives, I think, the benefit to startups. And then ultimately, hopefully, as long as the startups are good ones, drives benefit to investors alike.

SPEAKER_00 25:03

Speaking about the new benefits and the opportunities, low-code, no-code solutions are opening for the startups. And you also mentioned democratization. So as capital becomes more standardized and data-driven and with tasks that once required $100,000, now being executed for probably $10,000 through AI and automation, what leadership and mindset shifts will founders and investors need in order to embrace this and thrive?

SPEAKER_01 25:42

The biggest shift is probably going to have to go to the founders or potential founders out there. On one hand, it is no longer acceptable to go and seek $150,000, $250,000 to build an MVP for a pre-seed investment. I say that with the caveat of drug development pharmaceuticals with rocket engines, with you know deep tech or quantum tech, where yes, you have to invest a significant amount of money in order to even build an MVP and to kind of spec out an idea. But barring those types of investments, to your point, with a lovable as an example, you can build an MVP, and that will only get more and more simple as time goes on and as the AI gets better. So somebody investing a few hundred dollars in a few hundred hours is very capable with little to no engineering or development expertise to sit inside of one of those vibe coding platforms and build something. And build something again, depending on how complicated it is and how nuanced the product is. Doesn't mean it's a final version, but at the very least, it's something that if you do that, it will put in today's environment, and we speak with founders across stages all the time. In today's environment, if you are able to do that and actually generate a dollar or two of revenue, then you are way ahead of the pack for most, first of all, for almost all pre-seed investment stage companies and many, many seed stage investment companies as well.

SPEAKER_00 27:30

That sounds great. And of course, it is crucial to have that advantage. So just as a reminder, how those companies can differentiate themselves from the pack. Jeffrey, from a global lens, will FAS democratize access to capital opening doors for startups in emerging markets, or do you think it will rather reinforce existing inequalities?

SPEAKER_01 27:59

Today we would I would say that on an annual basis we engage with roughly 100 clients, let's say plus or minus a few. And roughly 15% of those are going to be outside of the US. And most of those are centered either in Western Europe or in Middle East. We have clients in Eastern Europe, we have clients in Oceania as well, in Singapore, for example. But most of the outside of the US is Middle East and Western Europe. And almost all of those clients that are outside of the US are typically looking for US capital. So they'll engage us to say, hey, you know, we're here. Help us find capital in the US. Some of them are expecting to convert to a US company, some of them don't want that and just are looking for investment where they are local. I think that what FAS does is make capital raising more accessible to more people, both in and outside of the US. And I say that more as a comparative point on other tools out there. There's Founder Suite, there's OpenVC, there's a number of all these different tools. And I often look at those as saying, hey, it's like giving a calculator to my five-year-old son. Calculator's not broken, five-year-old's not broken, but you're giving a set of tools with little to no support on the back end and telling people like, hey, this is going to help you raise capital, go for it. Maybe there's a Zen desk, maybe there's a how-to guide. So, really, with what we're doing with FAS and a new platform called Fundex, there's always this element of manual engagement that needs to be on the back end. And I think that's really how you can create a tool to help somebody raise capital. I think with FAS, and why we had such a play on words, is that my thesis around SaaS is that SaaS is dead. And a lot of people are saying the same thing, software as a service. I think the acronym stays alive and becomes more emboldened just with a flip of the last two words, or the rather the end book words. So software as a service is dying. Service as a software is really what the AI agenic revolution is driving, and certainly with what we have built. And the idea is that I don't want to sign up to some sort of super complicated project management tool, and then either myself have to sit and learn how to use it or hire another human just to sit and learn how to use this software and do project management for the company. That software is a service. Then you have to hire a person to run the software as a service. Service as a software is something that is very, very light touch, understands what you need and what you want to do, and then assists you in executing on it so that you don't have to spend all your time, all of your bandwidth, or hire another person just to manage this platform that you're already paying capital to. So I think that's really where FAST comes in. It yes, democratizes capital raising. I mean, I would say that's true, although I don't I don't say that term often, but I think it does because what we've effectively done is take an institutional capital raise process and productize that so that we can drop it into our clients. And that doesn't matter who the client is, they're raising a million dollars, they're raising $20 million, they're raising a hundred million dollar fund. Structurally speaking, our platform, our service looks exactly the same for those clients. How we work, how we generate leads, how we pull those in, how we're writing the copy, how we're sequencing those, how we're following up with them, how we are running our weekly meetings with our clients and reporting to our clients, all of that, regardless of a financial technology company, a real estate company, an AI company, an infrastructure project, it doesn't matter. Now, the content, of course, is customized and difference for every single client and every single race. But structurally speaking, it is not. And the workflow that we have implemented and the way that we do it, I think will benefit and I've seen benefit everybody who engages with us. And again, it's it's not because we're selling a Rolodex or a phone book or some sort of short list of introductions, but this is fundamentally best practices of how to raise capital that we're providing to everyone. And the last point I would kind of share on that is well, why don't you do it yourself? To do this yourself, anything like a pitch book is maybe 30, 35k a year, prequint is maybe 50k a year, zoom info is maybe 30, 35, 40k a year, and you can only sign up to those platforms for a year at a time. So that starts to become preclusive for a lot of early stage companies raising capital. Not to mention, an early stage founder doesn't really have the time to sit and do that top of funnel work, right? To qualify leads, to personalize them, to pick up the phone and call the leads. So they end up hiring an analyst to do that. Depending on where you are, and you want someone more or less local to you, that analyst is gonna cost you another 60, 70, 80k a year. So between all and said and done, you're in it for over $100,000 a year and you're in it for a year because you're not going to fire that analyst if they can't get you on the phone with investors. I mean, if they're doing their job correctly and no investors are picking up, you can't get rid of PitchBook because you've signed a contract. So the way that we look at it, despite you know, cost being relative, we're able to do all of that and just give it to our clients month to month so they can actually see and feel the value that we're offering to them without having to commit to some sort of long-term engagement with any software provider or any other types of providers. So that's why, you know, I know it's not exactly the answer to the question of do we eliminate the inequality or do we kind of push it forward? I don't, I don't look at it that way necessarily. Like, yes, perhaps because of the pricing and and kind of fractionalization of what we do, we are democratizing it further. We are making it more accessible to people to actually use our platform and work with us to raise capital. Because all we're doing is implementing best practices. And look, if you can do it in six months versus 12 months, then you've just paid half the cost, essentially, in doing something like that. For people who are already trained in doing this, there's no onboarding really needed, there's no payroll taxes benefits, there's no all these other frictional costs involved in our services.

SPEAKER_00 34:16

Sounds amazing. Very straightforward, and the benefits are obvious.

Productizing Capital And Global Access

SPEAKER_00 34:23

But I'm also thinking about the other side of this story about the investors. So they must evolve in this landscape. What do you think will distinguish the winning BCs from those left behind in their office and AI-powered capital?

SPEAKER_01 34:43

Probably two main items that I would say. Willingness of responding, I guess, from an investor's perspective. I understand that investors oftentimes want to have warm introductions, but at the end of the day, it is their job to originate investments. And it shouldn't matter where those investments come from. Of course, if it's a warm introduction from a trusted source, that is part of the diligence. But there's some investors that don't respond to calls or emails, despite them wanting to allocate them having dry powder on the sidelines. So I think responsiveness will be incredibly important from the investor's perspective, especially as both FAST is proliferated as a service or as anybody else can do it, right? Just as a best practices over time. And I think also VCs and investors having operating experience, it turns a lot of companies off. And you know, it's an interesting phenomenon that I'm seeing more and more recently that the best founders, ones that almost proactively venture funds and investors reach out to, have this aversion to working with investors with no operating experience. And what I mean by that is you'll get an analyst or an associate who's sitting there taking a meeting and saying all these things. And for some reason, it's often curt and negative to founders, and then the founder will kind of explain to me the situation and what happens. Sometimes it's even partners. And I bet them that this individual who they're talking about has no operating experience. And nine out of ten times we'll look up their LinkedIn profile, and it's like graduated college, maybe worked for like a government organization somewhere, then was an analyst at a venture fund and like over time raised in ranks. Never have it started a business, never had to like sweat about making payroll or doing that or building a product, launching an MVP and something breaking and all these different things. And I think, well, I think that's okay as long as that individual is measured. There's almost this like aggressive tendency of a lot of non-operators when they're sitting in an investment seat with some of our clients. And I have never been able to explain this. And I think that's really the second piece of where a lot of these venture funds are starting to drive companies, good quality companies, away because they're too institutionalized. They're bringing on people who know how to invest out of a textbook and have never done it in real life. And I think that's something my second point is really what should start changing a little bit. It doesn't matter if this individual failed at a business. I think failing at a business is almost as important as succeeding as a business. But have some sort of operational experience, even if the venture fund, quite frankly, runs the recruitment efforts and only hires those people or gives everyone, you know, $10,000. Go code something and try to launch a business, and that's how I'm going to recruit you into my venture fund. I think that would be a valuable recruiting method for them because at the very least, those people all have tangible experience on what that was like. And they can add value to the conversations rather than kind of well, not adding value to the conversations.

SPEAKER_00 37:51

Your approach is brilliant, and I love your philosophy behind the business because it is so true. You have to have some experience and understand how easy or difficult it is, and there is no success without ever failing. So both sides of this coin are important in order to understand the complexity of the process and be enabled to create more success in the future. So I truly appreciate your approach. Jeffrey, what is one thing investors, leaders, and business owners must unlearn to succeed in this AI-powered fundraising and business growth?

SPEAKER_01 38:38

I want to say everything, but I won't be a stark. What I would say is that the fundamental notions of, and I think we spoke about this either in this conversation or just prior to the whole idea of there being certain centers of the world, so to speak, or centers of the universe or centers of venture. You know, 20 years ago, you'd say New York is a center of tech and venture. No way. It's a center of finance, hedge funds, funds in general. But now all of a sudden it's a tech center. Singapore as well, is a relatively new city in and of itself, and also a tech hub for investment. So I think that the traditional way of thinking, although has evolved over the past, let's call it 20 years, effectively. I mean, it's been longer than that, and venture's been around longer than that, but the last 20 years have been incredibly transformational for the venture landscape, both geographically, where individual founders are coming from, whether they're coming from another country or coming for certain schools or coming from certain locations or cultural backgrounds, being able to implement their learnings and their life experiences into successful businesses. So I think that unfortunately, what has happened is over the past 20 years, because of maybe volume and or maybe availability of data, there's been almost too much reliance on this kind of like filtering methodology of investors going to look at founders. And if we can open that up a little bit further, I think there's so much more to gain with a lot of these early stage companies and founders that are trying to make businesses out of themselves. Similarly, you know, unlearn the fact that a seed investment has to have a million dollars in revenue. Maybe tell the founder that they should be pre-seed or they should be calling it sequentially one, two, three, four round. But to fundamentally have so many seed investors specifically looking for revenue, then I, you know, don't call yourself a seed investor then. Just say I'm a series A investor and then avoid the conflict of whether it's us through our services or founders directly reaching out to you, Mr. or Mrs. Seed investor, only for you to tell them that you're looking for a million in ARR. It's not a seed investment. So I think that's what people really need to, I guess, unlearn is this new definition that people have just kind of pushed everyone else forward. And I think almost it is unlearn what's been learned in the past 20 years, so to speak.

SPEAKER_00 41:09

That is not so easy, but actually it is needed because if we want to move forward in a powerful and impactful way, we need to redefine the rules of this game. And I really appreciate that you highlighted this need and the details around what we need to unlearn. Thank you. I so much enjoy our conversation. I could continue it for a very long time. I have so many questions, but still I'm going to ask you this one.

What Investors Must Unlearn

SPEAKER_00 41:42

If you could offer one piece of advice to leaders to ensure growth and success in the coming years of AI transformation, what would it be?

SPEAKER_01 41:53

Well, I'm a big proponent of scientific methodology as it applies to businesses. So having a control, having a variable, variable being your AI or whatever innovation you're implementing, having a hypothesis, what do I think this is going to result in? And then very, very importantly, letting it run for 60 or 90 days. Taking a pause at the end of that period of time, no less than 60, because otherwise it's not enough data to make an informed decision. So after that point of time, taking a pause, reviewing the data, seeing the impact, and doing it all over again. In today's day and age, with AI, with so many other different types of innovations stemming from AI or as a result of AI, not innovating in a business is effectively you're digging your own grave by not innovating. They used to say if any country is not growing, it's shrinking. Same thing. If your business, not to say growing from a revenue, sure, like of course, that should be a focus of any business. But if you're not innovating and if you're not changing a few practices, best practices internally at the firm, then frankly, you're likely going to get outpaced by someone else. Not to say that you need to implement everything. If it doesn't work, of course, don't implement it, but to not try and just to sit there to say, hey, everything we have has been working the way it's been working. Let's not touch anything about it. You're writing your own test sentence. That is my opinion.

SPEAKER_00 43:19

Absolutely brilliant. I couldn't agree more about it because there is no future without innovation. And if you don't progress, if you don't develop, you are going to degrade. There is no way to stand where you are and stay without being changed. So either you are moving forward or you are pushed back. And I doubt that somebody wants to really choose that path backwards.

SPEAKER_01 43:49

Agreed. Agreed.

SPEAKER_00 43:51

Thank you so much, Jeffrey, for being here today with us and sharing your wisdom, your experience, and all the golden nuggets. They are invaluable. I so much appreciate you and I enjoyed our conversation from the depth of my heart. Thank you.

SPEAKER_01 44:08

Thank you so much, Amy. It was a pleasure being here. Hope to be back soon.

SPEAKER_00 44:12

You'll definitely be invited again.

Scientific Testing, Innovation, And Farewell

SPEAKER_00 44:15

Thank you for joining us on Digital Transformation and the F for Humans. I am Emmy, and it was enriching to share this time with you. Remember, the core of any transformation lies in our human nature, how we think, feel, and connect with others. It is about enhancing our emotional intelligence, embracing a winning mindset, and leading with empathy and insight. Subscribe and stay tuned for more episodes where we uncover the latest trends in digital business and explore the human side of technology and leadership. If this conversation resonated with you and you are a visionary leader, business owner, or investor ready to shape what is next to come, consider joining the AI Game Changers Club. You will find more information in the description. Until next time, keep nurturing your mind, fostering your connections, and leading with heart.