Startup Talk Toronto’s Startup Podcast Episode 7 Fintech and Funding

Startup Talk Toronto’s Startup Podcast Episode 7 Fintech & Funding

Books Mentioned:

Zero To One

Venture Deals

Startup Opportunities

The Lean Startup

Hosted by The Startup Coach

Intro: Direct from the six, world renown, and Canada’s largest city, With Canada’s biggest thinkers, Visionaries, and hustlers. This is startup talk featuring the founders, funders, innovators, and community leaders, who have lead Canada’s Startup Ecosystem right here in Toronto. You’ll hear the challenges, the failures; the successes Toronto’s Startup podcast gives you the full story direct from the Entrepreneurs and influencers, who’s made a difference. Now the host of Startup talks, the founder of TorontoStarts, the Startup coach.

The Startup Coach: Welcome back to Startup talk. Toronto’s Startup podcast with the Startup coach on this episode I talked to one of Toronto’s starts own Rainer Takahashi of Jauntin about winning $5k at the CNE Canadian National Exhibition national pitch competition, getting insurance with a swipe, getting B2B traction, and what is like for a Startup to find and work with enterprise partners. I also take the time to talk to Stuart Browne, (C.E.O) Pycap venture partners and Startup funding expert, to talk about what he looks for in a Startup, advice when talking to Angel and (Venture Capitalists) VC investors and more. All on this episode of Startup talk.

The Startup Coach: Hey it’s the Startup coach here and I’m down CNE innovation garage. And they have the Canadian National innovation pitch competition all weekend long so I’m here with Rainer from Jauntin and they won the pitch competition in there category yesterday and won five thousand dollars. So tell me about winning your category and how it was the pitching here?

Rainer Takahashi of Jauntin: Oh it’s, fun we’re right here, in the innovation garage. Pitching in the middle of everything so we’re in the travel & leisure category and we were fortunate enough to win the division. So we will be moving on to the semi-finals on Sunday.

The Startup Coach: Oh yeah, and I’m actually a judge in the semi-finals on Sunday. So we won’t tell anybody that. So tell us a little about what Jauntin is and how you guys came up with the idea?

Rainer Takahashi of Jauntin: So Jauntin is a software company that enables insurance companies to distribute micro insurance, so it’s an hourly insurance policies. So as you can imagine right now a lot of insurance is done right now annually. Well with the gig worker’s and the shift in temporary jobs people are looking for shorter term coverage, So we have a software that helps insurance companies distribute those shorter-term insurance policies and the way we got into it I was also a gig worker myself, whenever I got a gig job I want the ability to quick and easily get some sort of coverage for just that time I was working. But that solution didn’t exist so we created it ourselves.

The Startup Coach: So how long have you been doing this?

Rainer Takahashi of Jauntin: It’s about sixteen months now.

The Startup Coach: I work with startups all the time and that’s a big problem for having insurance for all sorts of reasons when you’re an individual or a freelancer. So this was a big pain for you for a while, and how did you build your team, was it you all by yourself?

Rainer Takahashi of Jauntin: So it’s myself, and my co-founder Maya she’s on the non-tech side I’m more on the tech side. So we balance each other really well she focuses on the non-tech side keeping us all organized getting the new development partnerships and then I kinda the face down building the technology.

The Startup Coach: So you started sixteen months ago. I met you I think was in April last year could be…it’s, a little blurry going back, I run so many events. I remember it being cold…what’s happened since then what’s your market traction like where are you?

Rainer Takahashi of Jauntin: Sure so we went Live with AIG our first insurance partner to provide hourly insurance, travel insurance to travelers I guess obviously. So now you can get just one hour of insurance through your phone. let’s say you want to cross the border just to go shopping for couple hours in Niagara Falls you can actually get two hours of the hours of insurance now for the time you’re on the other side of the border so that was a huge win for us we’re hoping to expand with them and then we’re in talks with numerous other insurance companies around the world actually who want to use our software to distribute both travel and non-travel related insurance products

The Startup Coach: How do you measure traction and sort of the active users or is it just by big cooperate customers, like being on AIG?

Rainer Takahashi of Jauntin: Right, so for us it’s mostly B2B sale so the number of insurance companies we can sign and then we secondary would be the number of people that come back and continue to use that insurance with that insurance company, Because our goal is not only to convert the transaction, but the user to a lifetime user for the insurance partner.

The Startup Coach: And with your insurance partner are you a white-labeled product or did they see Jauntin?

Rainer Takahashi of Jauntin: It is completely white labeled so we’re not a broker or an agent we are a software company so, therefore, all the branding is the insurance partners branding.

The Startup Coach: Great, so what’s the next step for you guys?

Rainer Takahashi of Jauntin: So we continue to negotiate additional contracts, contrast with insurance companies. And at the same time, we’re in talks with platforms just as an example of a platform we’re not necessarily speaking to them. But Expedia would be one task rabbit would be another, where we wanna integrate our technology and the insurance obviously from the insurance company into the platform. So they too can start the distributing insurance on their platforms.

The Startup Coach: Yeah, and I’ve seen your product a couple times now and you know the one click or press or swipe depending on what you doing on the screen to get insurance and then turn off it’s got to be empowering millennials. So it’s interesting to understand how you’re not necessarily targeting the end consumer, because your clients are the insurance companies, because you’re just enabling the technology for them. How are your clients targeting millennial’s in the new generation, who don’t want to deal with old style insurance?

Rainer Takahashi of Jauntin: Actually, it’s not all that complicated lot of paid search and targeted ads the way they doing it. So the thing with insurance is the way people start buying it or looking for it is usually searched. So that’s part of the biggest area, and then other creator ways that they are doing it is bloggers, teaming up with influencers and bloggers. Because that’s the era we living where you go on Instagram you see somebody doing something and then it motivates you to do the same.

The Startup Coach: And that’s great for consumers. But a lot of our listeners probably and definitely the people I deal with in our community are B2B. So how do you actually get the insurance companies attention to talk to, because you’re not necessarily a big name right now?

Rainer Takahashi of Jauntin: Yeah so we’re being lucky in that sense all our leads so far has being inbound from us doing speaking engagements and pitching such as here at the Canadian National Exhibition CNE we’re really we have a great PR lady that gets us a bunch of speaking engagements on panels at different conferences and from there, people comes to us wondering what our technology is all about. So that’s work out really well for us and so far that’s really the only thing we’ve been doing. We don’t have a sales team or anything yet.

The Startup Coach: So for early stage Startups or young entrepreneurs who only have an idea, what kind of advice would you have for them?

Rainer Takahashi of Jauntin: Oh boy, oh boy advice, advice Startups in general or…

when you’re about to give up don’t because that’s when the next breakthrough is going to happen.

That’s happened to be so many times where I was really so close to giving up. I gave myself another week and then something good happened. And then it goes in cycles, but you can’t give up

right when you think you’re going to give up something good is going to happen,

and I stick to that.

The Startup Coach: So there is two side of that you know the belief that once you decide what you’re going to do, and what your goals are the universe conspires to make those things happen. But at the same time, the universe doesn’t make it easy for you. They do say perseverance is a good quality in a entrepreneur to make sure that you don’t buckle at your first problem. That you continue to push through even though the universe won’t make it easy. It will throw out those problems you’ll have those desperate moments.

Rainer Takahashi of Jauntin: Yes absolutely, and just like anything you have to go out and get it. If you’re sitting back waiting for something you should be really thinking to yourself what can I do to speed this up, what can I do from my end I get that persons to respond to me or to make that sale. So to always look back on yourself and to see what you can do to make yourself or your company and Startup move forward more quickly.

The Startup Coach: 

Whenever I’m talking to an entrepreneur or Startup. And they say they are waiting for something that’s a red flag for me.

Waiting shouldn’t be in your vocabulary unless you know you’re trying to de-queue  waiting times or whatever for people. Because waiting is not an activity for me it comes off as an excuse and for the most part, it generally is. So if there is for something you’re in a regulation, legislation yeah, there might be some real legitimate things that are coming down the pipe. But that means you need to be active in all these other areas to move steps forward.

Rainer Takahashi of Jauntin: Absolutely if you’re doing a Startup and you find yourself bored or not doing something, something probably not right because at the end of the day Startup life is a lot of crazy hours. And if you find yourself having a lot of time or even sometimes available to you, you might want to see what else there you can do to help yourself there in the future speed things up.

The Startup Coach: Yeah and I think entrepreneurs, are at least at an early stage understand the level of effort like I’ll go out to meet a friend for a drink on a Saturday night, maybe not this Saturday night. Because I’m working here and I’ll bring my laptop and I’ll be working before they get here and I’ll be working after they leave and I’m like working, working, working you take those fifteen minutes, you take those half hours, people like you don’t take a break? Yeah, I take a break when I’m actually talking to you. But you have to make these sacrifices if you wanna drive the thing successful. Is there a book that you have read in the last year would you have find inspirational for entrepreneurs, or any entrepreneurial book you would recommend?

Rainer Takahashi of Jauntin: Yeah definitely, and this is a popular one, Zero To One I’m totally blanking on the author right now. But that one is a great read for any aspiring entrepreneur, and then also if you’re already in the Startup world you have to read Venture Deals again I’m blanking on the authors.

The Startup Coach: Brad Feld!

Rainer Takahashi of Jauntin: Yes, yes that is the bible for fundraising

The Startup Coach: I met Brad Feld years ago he wrote several books with one of our advisers Shawn Wise. Brad Feld is a great guy.

The Startup Coach: Interesting he’s written a lot of books. And Startup opportunity is a great book to read. If you’re getting in the process read Startup Opportunities then Lean Startup.

Startup Opportunities

Lean Startup

Rainer Takahashi of Jauntin: Yeah and that’s another good one is Lean Startup yeah absolutely.

The Startup Coach: It’s funny he talks briefly about work-life balance and something I’ve seen with him recently. And there really isn’t a work-life balance when it comes on to entrepreneurship. There is just you know your life. Because work-life balance imagines a scale in balance, I don’t know of any entrepreneur where that think, life is in balance. So I think you just really need to understand something around your self-care and taking care of yourself through you know your eighty hours, hundred hours or week and have the support system to support you there.

Rainer Takahashi of Jauntin: Yeah, and exactly if you have a good support system and you’re…my recommendation is to obviously keep physically and mentally fit. It will go long way especially in the long-term as you start to burn out you’ll be able to go longer than others that aren’t taking that care of themselves.

The Startup Coach: So right now, you’re looking for funding or you just trying to connect with potential customers?

Rainer Takahashi of Jauntin: So yeah, we’re actually in parallel fundraising, we’re hoping to raise something for Q4 or so over the next couple of months we’re completely bootstraped right now. So we’re hoping to use those funds to hire team builders’ team and get this company really noticed in the software industry.

The Startup Coach: Have you talked to all, the funding suppliers, SRED, Ontario Centres of excellence, and the digital meter tax credits, and all the other different government programs.

Rainer Takahashi of Jauntin: Yeah the ones you just mentioned we have a…but there seems to be like an endless supply  which is a great thing for Canada, I think. So yeah, we’ve hit all of those and then we continue to look for additional ones and it’s almost a fulltime job on itself.

The Startup Coach: Yeah, we will talk offline about a couple other opportunities for you. Is there any other last parting words you have for our audience?

Rainer Takahashi of Jauntin: Oh men, I guess at the end of the day if you’re thinking of getting into the Startup life, it’s not for everyone. But keep the end game in mind, you’re doing this for a reason whether it’s for the money or to get out of a corperate job and to be happy. Just

always keep the end game in mind and it will keep you motivated to keep going.

The Startup Coach: And where do people find out more about you and your company?

Rainer Takahashi of Jauntin: Jauntin.com so (J.A.U.N.T.I.N) dot com. And you can follow me personally on Instagram, or at Twitter @Ra_Rains so @RA_ Raines.

The Startup Coach: And look for that in notes, and thank you for being part of the Startup talk.

Rainer Takahashi of Jauntin: No, thanks for having me.

Meet Stuart Browne CEO of PyCap Venture Partners

The Startup Coach: It’s the Startup coach here. And today I’m here with Stuart Browne C.E.O. of Pycap venture partners It’s great to have you here Stuart.

Stuart Browne, CEO PyCap:  Thanks Craig great to be here.

The Startup Coach: So tell me what is Pycap, venture partners?

Stuart Browne, CEO PyCap: Pycap, venture partners is a venture capital, that facilitates the raising of capital for early-stage companies.

The Startup Coach: So what is that entail?

Stuart Browne, CEO PyCap: That entails basically investing in companies directly through our venture capital fund. It also entails building up a company financials depending on the stage of a company is in. And providing Advisory services on how they can successfully raise capital from a number of sources, including of course V.C’s (Venture Capitalists), angel investors ICO’s, STO’s, angel groups, and government organizations.

The Startup Coach: And so what types of Startups do you work with?

Stuart Browne, CEO PyCap: We work with companies that are kind of in and around the early stage of course like the pre-series A stage. So they usually have what’s called a working prototype a proof of concept and some sort of market validation.

The Startup Coach: And what do you normally look for a market validation?

Stuart Browne, CEO PyCap: Well, I mean best case scenario market validation comes in the form of revenue. But that doesn’t necessarily have to be the case. Often time a company can prove has there’s a demand out there for the product or the service they are creating and that can come in the form of high-end customers using there Beta version of their platform, for example, if there is pre-sales through a crowdfunding platform. That is great indication of market validation. And I guess how many followers they have and that sort of thing.

The Startup Coach: Interesting, so traction in various forms?

Stuart Browne, CEO PyCap: That’s right!

The Startup Coach: So at this point having worked with lots of Startups what’s the main thing you see Startups struggle with?

Stuart Browne, CEO PyCap: Just raising capital, in general, is a huge challenge if I can elaborate on that. I feel

one of the major things holding companies back or preventing them from being able to successfully finance their business is generally having a fundamental understanding of who and what they are trying to raise capital from.

I mean there is a lot of talk of VC’s (Venture Capitalists) and Angel’s and ICO’s and crowdfunding and all that sort of thing. But when you get right down to it and you speak with entrepreneurs, they maybe brilliant in terms of creating the technology for the product or service, they may really know the industry well that they are selling into. But they don’t necessarily know what motivates the investors that they are looking to raise capital from.

The Startup Coach: Interesting, so how did you get into this in the first place, who is Stuart before Pycap?

Stuart Browne, CEO PyCap: Stuart, before Pycap I was doing my MBA at the Schulich school of business. I was looking to get into investment banking, and I started to get involved with the world of Angel investing. And I learned a ton about early-stage tech companies, what to look for, what to avoid in terms of an investment opportunity despite the fact that a product might look good. And in the whole process of getting to know how to value deals and Startups and invest in them and get a return. I decided that there’s a huge opportunity to create a venture capital from like Pycap, and we just pursued it. And that’s what bought us here essentially.

The Startup Coach: So I’ve known you for a while now probably I think my notes have said over three years. I’m not sure… it’s greater than three years now anyway. And I know you’re being a mentor and a speaker, how did you start doing that?

Stuart Browne, CEO PyCap: Well there was a huge lack in the Startup tech community for individuals who intimately know the space of venture capital. VC’s are inherently private, hence the term private equity. They fall under the umbrella of private equity. So they have large amount of capital usually and they looked to deploy that into a much needing early-stage companies that are starving for capital.  A lot of VC’s get bombarded with entrepreneurs pitching them for financing, and so there’s in a huge incentive for them to get there name out there, and become a public speaker. And educate entrepreneurs on what it is to be a VC.  So when we were starting out, we were very opened to get on stage and work with entrepreneurs. I mean we see ourselves as entrepreneurs and helping them bridge that knowledge gap. It was a huge amount of value for the entrepreneurs we were speaking with and mentoring as well as the conferences and events that wanted someone with our experience to educate the audience basically.

The Startup Coach: Yeah, I’ve also seen you on judging on a number of pitch competitions not only several of our pitch competition here at TorontoStarts. But the CNE innovation garage and several or some… do you get a lot of leads that way?
.
Stuart Browne, CEO PyCap: Yeah, we get a ton of leads for sure. I mean we definitely do a quite a bit of judging of pitch competitions as you mention in Toronto. But we’ve also had the opportunity to judge pitch competitions in other countries as well. Including countries in Eastern Europe in Latin America throughout Asia and it’s an amazing opportunity for us. Because we may have companies were interested in getting involved with or adding to our portfolio. And then we might see a company doing the exact or the same thing in a different country through these pitch competitions that we might not have known about otherwise.

The Startup Coach: Great! I always think that they are a great source I always tell my Startups to pitch as many times as possible. In fact, I too have my recent Startup Launch graduates at Startupfest pitching this weekend they’re were sending me snaps and they did fairly well I don’t think they’ve won prices, but they are not quite there yet. So you now… have taken this teaching to the next level and you have run a course that you teach at U of T (University of Toronto) what’s that all about?

Stuart Browne, CEO PyCap: That’s right, I mean as mentioned given the demand that’s out there among entrepreneurs needing to learn you know as much as they can in order to successfully raise capital. We have embarked on this initiative with the University of Toronto to create this course called financing in an early-stage company. And as with the University of Toronto school of continuing studies. And our aim is to provide entrepreneurs with everything they need to know to get early-stage company financed. But as we’ve seen, I mean we’ve been doing this since the fall of twenty seventeen (2017), we’ve had students who come from a whole array of different backgrounds. Government organizations, individuals who are consultants helping out early-stage companies. We’ve had individuals come in from MaRSDD as well as retired, you know highly successful very wealthy individual, who are not just looking to raise capital for a Startup. But they are actually looking at like from a different perspective. So they wanna learn you know, how do VC’s value deals, how do they decide which companies to invest in. So they are actually there to learn how to make their own Startup tech investments which is interesting.

The Startup Coach: Very interesting, it’s interesting to see all the differences size of the market that shows up. When I run events I always think that the Startups or entrepreneurs for a lot of times for as many other sequences of the market there to look for clients or to learn more or to do all sorts of things. So interesting you mentioned ICO’s a couple times we went through this. ICO is obviously a new, initial coin offering, is a new funding source. How much do you cover in your course, and how much are you into Cryptocurrency?

Stuart Browne, CEO PyCap: We cover it, it’s a significant portion of the course and we teach that right towards the end. We dedicate an entire class to it and we’ve gotten into guess speakers who are heavily involved and are industry leaders in the world of Cryptocurrency currently we have one block chain company that’s involved into Cryptocurrencies, within our portfolio and we see a massive potential there for all kinds of opportunities. Not least of which are early-stage companies accessing capital to grow their business.

The Startup Coach: I’ve had five block chain companies go through my accelerator program Startup Launch and just talking to Sunil head of TechStars here in Toronto, couple a days ago he was telling me that their next cohort will be a strictly blockchain cohort which is very interesting. And as you know I run the Toronto Cryptocurrency Conference the seventh one is tomorrow actually. And just starting next week with The Cryptocurrency podcast, and probably what you don’t know is next month I am doing a live radio show starting on Blockchain Radio a weekly radio program. So I’m heavily invested in Cryptocurrency community space here. So we would like to talk a little bit more as we go down that road. But since we’ve been talking and in this space for a long time we… you and I decided that we need to educate more and more on Startups on how do we get in front of people, and how do we understanding financing more and more and we’ve been working with a lot of experts in the area. And I know you’ve designed a new course and a structure that we’re going to be putting together around our Toronto Mastermind Series. And you know it’s a… look like it’s a ten-week program, Its not 100% finalized. Because it’s going to cover creating a financial roadmap, understanding and creating a negotiating team, valuing Startups. How to value each Startup, structure a successful investor presentation building traction, building a winning team, you know working with VC’s, Lean Startup methodologies. Is my company VC fundable and how to create an ICO & STOs  that’s a lot of stuff to cover? Is there enough time to cover all this information in 10 weeks?

Stuart Browne, CEO PyCap: Well in this space, I mean having been in the venture capital industry for about seven years now I have never really, have the problem of running out of things to talk about. Moreover, it’s more likely the case is that there is too much to talk about. Whereby you know my workshops and my classes, is usually run beyond the end-time with questions and follow-up, and even like bonus presentation that I always try to squeeze in. So yeah, there is a ton of material the students that have taken my courses have been quite happy with the results. And we’re happy to partner with TorontoStarts in order to facilitate more learning for entrepreneurs who need it.

The Startup Coach: And I think we share the same philosophy of having more value. I never like to go away feeling like I under delivered. So whenever I am running my programs, my workshops, my series are two or three hours long of content, content, content. And oh by the way here is share and here is the four manuals, and here are the templates, and here is all these other things here’s a ton of content. And I know that base on all the things that you have done and even in speaking and mentoring for TorontoStarts. And the Startup Launch program.  There is so much to be learned in VC and in the financing area when it comes to Startups, I’m really excited about this program. Moving forward at the end of the notes I’ll put a link to the programs so you can take a look at it yourself. But moving forward having said all this, do you have any part in advice for Startups, that you see they commonly do or what they need to do to get right?

Stuart Browne, CEO PyCap: Yeah definitely, Startups need to…I mean there is so much advises it’s a tuff question just kind of summarized. But if I’m speaking from my specific background what entrepreneurs, really, really need to do. If they’re building a business that needs to raise capital in order to be successful.

It is critical that startups understand who they are pitching to and what motivates them.

And how to go through that whole process, I mean understandable so a lot of companies get so focused and running their business and selling products and services to their customers and their market. But selling your equity to an investor is a completely different story. And they really need to intimately understand what’s going on in that realm before they embarked on that journey.

The Startup Coach: I couldn’t agree more. I think the relationship between investor Startup and entrepreneur is more like marriage than people understand. and they really need to take the time and consideration and need to know what they’re getting into. And so if people if people want to know more about you and Pycap how do they find it?

Stuart Browne, CEO PyCap: OK well, they could visit our website which is www.pycap.ca and if they are interested in learning more about the course we’ve teach at U. of. T or about our VC fund or any other of the initiatives they could contact us at info@Pycap.ca

The Startup Coach: And the info and the links will be in the short notes below, thank you very much for your time today Stuart.

Stuart Browne, CEO PyCap: Great, thanks Craig great to be here.

Outro: This has been Startup Talk Toronto’s Startup podcast for more exclusive content the episode vault and to be part of starts community visit TorontoStarts.com get your name on the newsletter mailing list and check out our upcoming events for more episodes subscribe now. And please recognize the time and work behind the scenes putting to connecting you with the biggest visionaries, entrepreneurs, and innovators in Toronto by leaving a five-star review. Join us for more next episode from Toronto’s most active entrepreneur and Startup community on Startup talk.