They call them accelerator programs for a reason. Time really flies.
It was only four months ago that we chatted with Duncan McDowell as he finished his stint working for Communitech and prepared to fly, with his startup colleagues, to New York for the winter cohort at AngelPad.
Their company, formerly known as Decision.io, is a decision-making platform for online form submissions.
McDowell has since returned to Waterloo Region with a new haircut and a new company name, plus a new perspective on startup life and what it takes to build a billion-dollar-plus company.
From late nights working in the city that never sleeps, to endless restaurant options,to hearing Dave McClure’s impressions of Waterloo, it’s been one hell of a ride, as McDowell tells us.
Q – Your company, formerly called Decision.io, is now called Blitzen. Where did the new name come from?
A – It means lightning in German and it’s also a wonderful reindeer. The reindeer doesn’t have much to do with anything, but it’s a good anchor point for people trying to spell the name.
We really wanted a dot-com for legitimacy and it’s better for SEO, and it’s generally nice to have dot-com. The bigger theme there is that the business is shifting more from strictly submissions management to more of a workflow app.
So a submissions workflow would be one of multiple different workflows that you could do in Blitzen.
Decision.io was a little bit pigeonholing in the sense that you are using group collaborative decision-making, and we were marketing it as submissions management.
Q – How would you describe your experience in New York?
A – The city is awesome. We lived in Williamsburg, Brooklyn, and commuted to Manhattan every day on the L Train.
The program was pretty cool. AngelPad is a lot different from a lot of the other accelerators. If you were to go to Y Combinator, they don’t really want you at the YC offices working, and you are more or less on your own with the exception of some really great mentors that they hook you up with.
But with AngelPad, you’re actually going into the office pretty much every day. You’re meeting with Thomas (Korte) and Carine (Magescas) constantly to iterate the work on your products. You’re finishing your company and most importantly the business.
One of the really cool things is that they don’t inundate you with mentors, where they are throwing people at you and you’re getting whiplash over and over again.
[With too many mentors] it gets difficult to synthesize that into one easy to follow path for your business.
Just having Thomas and Carine and the occasional investor or advisor come in is really helpful for strengthening the vision around what you’re doing, and then being able to tell that story.
Q – You used to help startups at Communitech. What’s it like being at the other end of an accelerator program?
A – It certainly is a different perspective.
With HYPERDRIVE [Communitech’s accelerator program] you would have Chelsea [Prescod] and Kory [Jeffrey] really setting the agenda and helping you along the way. In AngelPad it’s a lot more of Thomas and Carine throwing things at you as you go. And it feels more like some kind of boot camp, or being in a bit of a fraternity and you’re pledging. And it’s really interesting coming out of it, because they spend a lot of the program breaking you down and breaking your spirit, and at then end they really build you back up.
So being on this side of the table now, I guess I appreciate a lot more what it takes to run something like this. It’s different being a company I guess, in the fact that you are feeling the pressure and you are feeling the stress of getting everything in line for demo day, and making sure you that your story is tight before meeting with investors. There is a lot of urgency there, when you’re on the entrepreneur side of the table, rather than the accelerator side of the table.
Q – What was the biggest impact AngelPad had on your team and your company?
A – We went into AngelPad having sales, having a number of customers, having a business that is more or less running. And I think the biggest impact that they had on us was that they forced us to take a step back and re-imagine everything in a much bigger way.
If you’re going to go to the Valley to raise money, you have to have a big vision and a huge market. What we were doing before wasn’t a small market, it was still a billion-dollar-plus market, but they challenged us to think bigger than that.
I think that’s the biggest change for our company, is taking that step backward and re-evaluating and re-imagining everything; just always going for something a lot bigger.
Q – How have your views on entrepreneurship and startup life changed since the last time we talked?
A – I think this whole notion of overnight successes still holds true; it’s not going to be something that you’re going to build overnight.
The one thing that is pretty clear and obvious is that you have to always be showing an upward trajectory of momentum. Not only do you need to be continually growing, but growth – the derivative of that – has to be continually going up; you have to consistently be accelerating faster.
It means that you don’t have a lot of luxury of sitting around and waiting for product-market fit. You have to be challenging different hypotheses and assumptions as quick as possible, so that you can build whatever that graph is to up and to the right. Something has to being going up and to the right, or you’re not going to be an investible company.
I don’t think there is anything wrong with building a lifestyle business, or something that isn’t at high-momentum, but if you want to be a startup I think that’s the goal.
There is a contentious argument there, where people will say that you are not a startup if you’re not trying to be a VC-backed company, or angel-backed company. I don’t know if I want to take one side of the argument there, but there has to be some delineation where if you’re a startup, you’re actively looking for something where growth is concerned, because otherwise why don’t you call yourself a new business?
I don’t think developing software is a good enough characteristic of a startup; it has to be that you are looking for something more.
Q – What was the biggest lesson you learned while you were away?
A – I think it’s something that I knew before, or at least I had been told before and believed, but experiencing it is something completely different. There really is a huge disconnect between East Coast mentality and West Coast mentality, on not only investing, but also valuating startups.
It’s really unfortunate, but from everything I have seen on the East Coast – this includes Canada, but also New York and Boston – it is harder to do a faith-based round.
When I say a “faith-based round”, I mean you’re looking for investment from angels, VCs, micro-VCs, for a product that hasn’t been built yet.
Usually it is a hypothesis, or a premise, and generally you’re smart people, you have a smart team that are working on this. And you’re saying that we’ve done this in the past and we’ve worked for these different places, or we have this degree from this school, and we need some cash in order to get from here to there.
In the Valley, faith-based rounds exist, and in New York, Toronto and Waterloo, it is much harder to get funding for a faith-based round. Everybody always wants to see traction. What’s your traction? How many users do you have? How many paying users do you have? What’s your revenue?
It’s a bit disconnected, especially when you’re looking to raise a seed round, because when you think about what seed round means, it’s generally to start something.
It’s a really shitty thing for an entrepreneur to raise a seed round and get traction. It’s totally backwards, and I get it; as an investor you want to protect your return and you want to protect your risk, and you don’t want to put money into something that’s not going to work out. But if you’re not willing to [take a risk], then you’re losing a lot of opportunity, I think.
I have worked with some super smart guys in AngelPad who don’t have a product yet, and I would definitely invest in them.
East-West dichotomy of fact versus faith-based rounds is something that, in Waterloo, we need to fix, because we are losing so much potential. You’re going to have companies who are going to leave and go to the Valley, because they are going to get an angel who says, “Yeah, I’ll give you money, but you have to move to San Francisco, because we only do SF-based deals.” And they are going to go, because they can’t find capital in Canada.
Q – What’s the plan for the team moving forward?
A – It is build a new product and raise some money. Development is going to stay in Waterloo because it is a great place to be.
It was actually really cool; Dave McClure came to see us when we were working on Taylor Street in San Francisco. And we were pitching to him and it came to our team slide he said, “OK, great, cool. Really smart kids from Waterloo.”
Thomas said, “What does Waterloo mean to you, what about Google, what about these people from Stanford?” And Dave said, “Well, those matter in the area around Silicon Valley. In Silicon Valley, it’s all about Waterloo startups.”
We had a number of people mention that, so the word is definitely getting around.
This article first appeared on Communitech.