The Entrepreneur Podcast
The Entrepreneur Podcast

Episode · 2 years ago

Choosing the right people before the right idea with Rachel Zimmer of Entrepreneur First

ABOUT THIS EPISODE

Rachel Zimmer is the General Manager of Entrepreneur First, a $140M fund that bets on people first, and then coaches them to find their breakthrough ideas. Zimmer understands this process well because it’s exactly how she started her company, 5Crowd (acquired by sgsco).

In this episode, Rachel walks us through her own ideation process, the criteria that she used to filter her business ideas, and the uncomfortable process of leaving her job at Johnson & Johnson to pursue her entrepreneurial dreams with business partner Bram Warshafsky.

Since the acquisition of 5Crowd in 2016, Zimmer has continued to help professionals discover their entrepreneurial potential with the added safety net through her work at Entrepreneur First. She shares what she’s discovered about the qualities, personalities and combinations that make the best entrepreneurial teams.

...thats new Siris of the Ivy entrepreneur podcast. You're invited to listen in on the guest visits, my hustle and grit glass taking place virtually at the Ivey Business School. Hustling great is, of course, that we created to teach you everything that you didn't learn in business school in business school. In it, we invite world class innovators and entrepreneurs to talk about topics like motivation, how toe learn, what to prioritize and even how to be happier. In these episodes, you'll hear live audio from my classes because, honestly, there's just something different about the energy, excitement and honesty taking place in a live classroom environment. So get comfortable. Grab a seat And don't worry. Unlike my real class, I won't call value. Enjoy e am Excited toe have one of the hardest working entrepreneurs I know joining us today. So she's made some time to talk about a bunch of topics. We're gonna focus on ideation. A swell as making the entrepreneurial leap. Please, everybody put your virtual hands together for one. Rachel Zimmer. Rachel, are you with us? I am. Everybody in here. Okay, you're having me. Yeah, of course. Happy to have you. But I canceled the spotlight so you don't have toe. Look at me the whole time, Rachel. They got a bunch of questions pouring in but on we will get to a handful of those questions, so keep populating. But I think it would make sense if we started with sort of your entrepreneurial story and even rewinding back to when you were a student and how you sort of made the decision to do something else before jumping into entrepreneurship. So let's rewind and start with your story. Amazing On DSO I'm happy to be a candid and open as I can be. So any questions feel free toe. Throw them my way, but going back to my roots. So I was Queens Commerce grad. Don't hold it against me, Ivy folks. But we, you know at school had a ton of really great opportunities to meet other people that were like minded. And so in my fourth year of school, landed a job at J and J. And so think it was September October timing that I had had a job lined up for after school, and my friend at the time, Grandma Osofsky, was like, great, like we both landed jobs. And there's all these competitions. Do you wanna You wanna maybe enter some of them? And so some of them were like top ad exact means Marketing Association conference amongst a bunch of others And so, you know, very lame and nerdy students. We were like, All right, let's let's take Let's take a shot at them. And so we started entering the competitions and learned that we had an amazing working dynamic. We challenged each other. We had a ton of fun. We drove each other crazy. And we just, you know, push each other to the max. I need to walk away. But essentially, what we learned was that we were really powerful and winning team. So we want cars through top ad. We want a bunch of cash. We won big Unilever competition. And so at a certain point where, like, there's there's something here. So went on after Queens and we both landed at Johnson and Johnson and kind of interject with your first question, which was, you know, why did we choose the traditional? Why did I choose the traditional career path? I'm ready to school. And it was hard. Yeah, Francis, we want you should all do it top at exact through and through Mac. So there's many different competitions. Once you're in fourth year 30 or even you can you can start entering. So, you know, that's where we learned we were a really good team. But in our fourth year, you know, it was a hard choice Thio to take and to choose to pursue a more traditional path and, you know, crazy, delusional millennial. I wanted to travel and go into more debt. Just go see the world and or do something entrepreneurial and some really good advice from some alarm from Queens that were for years older. That just said, Go get, you know, a handful of years in a good traditional, you know, whether it's the accounting stream or finance stream or marketing stream, just to learn the basics of the working world. And I'm so appreciative that I did that because there's things that you just don't realize you know how to go on a business trip with your co workers, how to write a good email, how toe, you know, fuck up in a meeting and then how...

...to bounce back from it. All these different nuances that you learn in your you know, in your first couple years of working. And I'm grateful in retrospect that I went thio, you know, a big company that kind of beat some of that into me. But at the time, it was kind of ah, you know, on one hand, privileged to have an opportunity. On the other hand, a bit rest, a bit of restlessness of just wanting to start doing something entrepreneurial on our travel and see the world adventurously, you know, right out. So landed A, J and J and, you know, learned a ton learned I was fortunate to work on brands like Tylenol of, you know, you know, digestive health acquisition. So some big projects. But while there what was so great in addition to a great training and learning from really brilliant people was getting exposure to a lot of industry problems. And I'd say that was, you know, the biggest thing that I took away from that time, which was there were so many interesting problems and just waiting to be solved. And so during that time, brand and I would spitball ideas. Weekday evenings, weekends over lunch, at work and we came up with a whole bunch of wacky ideas. And so we ended up choosing this one idea five crowd that we ended up pursuing. And Aiken, you know, in future questions I could go into how we landed at five crowd in this in this business concept. But we ended up deciding to launch this company because we felt the pain ourselves, as you know, as users at J and J. And the pain was that traditional ad agencies were taking a long time and are very expensive to do really basic, simple things like it would cost 50 K and take two months. Thio modifies and banner on stuff that now is ludicrous. But back in 2010, when we first entered, the working world was just was just commonplace. So ended up choosing tow Launch, a premium freelance platform targeted in the marketing creative space world. We essentially bootstrapped or revenue funded our company, and we scaled it to be 20 people at a certain point between software developers, customer success and Bt. And then we were approached to exit, which we're not for sale, that when we learned about the opportunity, we were approached to exit in 2016. So our whole story startup journey was two years and nine months. Very, very, very quick. Andi, I look back at that time with some of the fondest, fondest memories in in My Life, and then there, after I'll be much quicker on this part, worked for requiring company for about three years and in a variety of leadership roles at our parent company. So lead customer service Suite 800 customer service folks around the world. You know Leadsom of our digital transformation efforts on then. Also on the side was an entrepreneur in residence of the DNC and coaching and mentoring some tech startups across a variety of industries. So that's a bit about me in a in a in a nutshell. So that is awesome. But I do want to rewind because this class is on. We're focusing on ideation, and so we are going to get into how you think about it now as an investor or advisor and entrepreneur first. But I want to rewind how how, if you don't mind spending a little bit more time on, how did you identify that five crowd was the thing worth leaving a stable job at J and J for like, where did the initial like Oh, that's a pain in the butt come from? Yeah, and Eric, I flipped you a graphic. If it's not too much trouble to throw it up, I don't think I'm sure this graphic with anybody so guys don't It's very embarrassing, but it's It's a fun one, so we see if I can project it. Perfect. So basically, what we did is we were spitballing over drinks, different ideas, and on weekends, and essentially we had five different business ideas that we thought were really great. Some of them were absolutely terrible. I'll tell you about two of them. So in the far right Dollar Condom Club Club, So there was. It was the rise of Dollar Shave Club and then the dollar ization of everything. And we're like, Wait a minute. Imagine there's a box that shows up at your door. So we thought this was brilliant for a minute. Thank God we did not perceive that one. And then crazy 22 year olds. The second one SD is epic snack drawer, so we were constantly hungry at work like imagine there's a driller of snacks that just automatically refills, which was a great idea. And, you know, lo and...

...behold, years later there's been the rise of like the hello Fresh is and the shops plates, which are more on the consumer side at the time, were like This is everyone's hungry. This is brilliant. Will sell into corporate companies. Andi, other to go. I won't bore you with the details of them, but we spoke called all these different ideas. And then we came up on the left side with our own criteria as to what would make an idea and effective. Now, looking back, a 22 year old me, I'd probably critique some of these questions that we had for ourselves. But this is the raw circa 2011 2012 graphic that I that I pulled. And so some of the questions just to double click on them, you know, is it a product instead of a service? Can it scale easily, you know, do we have a good understanding of what it takes to close the sales final? You know, are we the right people to actually tackle this problem? And so when we looked across these questions at the time. We equally weighted all of them and workload on the far left now five crowd is what it was. We renamed it, too was the highest scoring points. And so once we have gone through this ideation process, you know, rated and discuss them all across our criteria. It was quite methodical, and that's that's when we landed at work load slash five crowd, and we brainstormed on it for about a year before we actually went through and quit our jobs on. I had my resignation letter written fun, fun fact for almost a year. So it was something that I was coming in high and saying, like, We just need to do it full time. We're not making attraction that we need that we need Thio. But there were a couple of things that we continue to push ourselves to say. Can we do risk this just a little bit more while we're working full time? Can we do a little bit more customer discovery to validate the problem? Can we, you know, use the competitive platforms like the up works? Five fibers. Crap brings 99 designs of the world to figure out what's working on them and not so we did spend quite a bit of time. Once we have landed on this concept doing some of that customer discovery friends and, you know, strangers that we ask for interest to in the industry. Plus also, you know, really, really doubled down on that competitive piece in getting to know those platforms. So hopefully this is helpful because I kind of see, you know, it's kind of art with the science, but more just gut because you try and apply something scientific to it. And at the end of the day, you know, you need to have crazy conviction around what you're doing and have a passion for what yourself thing. Awesome. So this is helpful, and I wanna I wanna double click on a few of these specifically. So workload at the time came from I'm presumably you were at J and J. And you were the one. Actually, that would go back to these agencies to request these small changes. And we're seeing how much you were getting charged for them. Is that where workloads specifically came in? Yeah, you got it. And it's specific to my co founder Bram. So he had to edit a 62nd video to 15 seconds. And not too long before we were scrappy students working on, you know, competitions where we were hiring people on fiber. And so we knew what was possible there. And then Thio have a quote to get a video edited from 60 seconds to 15 seconds to take months instead of hours and then tens of thousands instead of hundreds of dollars. That was where he was head scratching, pulled me over. I had scratched, and I mean I at the time I had, like a 12 year olds 13 year old brother who could use my movie. I was like, Let's just ask my brother David, you could You could do this for us in 20 minutes versus versus hiring a traditional agency. So? So exactly to your point, we were the customer, and when I look across the other ones, I mean some of them were so that others will say we were the customer epic snapped or we were absolutely very hungry. Like that is true by like three o'clock in the afternoon. We were like, this is this is the one this is the concept. We know there's something here. So every day at three o'clock, you were like we have to do. This is the idea. This is the one way should just went to Costco and stuffed our doors. But way felt that so So I definitely felt it. But then I will say, Since then, I've done other customer discovery where I haven't been the customer, you know, since then in other you know, projects in my life. And so I don't think you have to be the person that experiences it. But I do think having a right to win and why you from unique exposure or...

...unique learning, is incredibly valuable. Thio Thio actually go to market Cool. So a few that we we've just touched on before you join. So does it play in a really big market? We say, is it in a big sandbox? So is there a really big opportunity such that if you needed to pivot or change the idea, then it could still be viable? You're still big in the state market, so that's overlap. So that we talked about Does it leverage your network? So, um, in at Ivy, we talk about the idea of ineffectual Asian, so sort of using your assets in order to come up with a business idea that it works. Sort of, given your skill set network assets or whatever. So does it leverage your network? That's you had an unfair advantage and that you're the right people to do it presumably because you Graham, that was part of his day job, right? Like he was seeing it. That's cool. Well, expander jumping in on that one s. So I think that the right to win can come in a lot of ways, right? A right to win. Could be. You're the user yourself. It could be a relationship that you have. It could be a technical skill set that you bring an interestingly while a Johnson and Johnson because we felt the pain and the pain was so big went viral throughout the organization. And so when we actually chose to leave J and J, they actually became first customer. That was how we revenue funded it. So we had an employer that had such strong conviction conviction in the problem we were solving which a validated. It was a really big problems. We could solve it. And then secondarily, I mean, that was an under advantage, right? Anyone else starting didn't have that, you know, significant sauce revenue that was then pulling us forward. So I just share that because, you know, if anyone enters the workforce has a great full time job, there's no reason why you can't be hate the term, but be an entrepreneur texted out there, and then if it doesn't work internally, you know, bring them along for the journey. How could be a founding clients? Yeah, that's great. And then the last one before we move on is the problem. Are you passionate about solving the problem? I like your part B, which is Could you see yourselves doing it 10 years in the future? I think any business that's worth doing, you have to think about yourself being in it for probably a decade. And I like to think about even are these customers that I could see myself spending time with for the next 10 years, because realistically, you're gonna be serving your customers and you're gonna be taking calls from them at 10 PM on a Friday or 2 a.m. On a Monday you know, these are the customers that you're gonna have to spend a bunch of time with, so we'll talk about passion in the future class. But I'd like to also think about are these customers that you could see yourself serving for 10 years? Okay, Cool. I noticed that you didn't have any threes here, but two is it is the market problema need versus a one. How did you reconcile that one and end up making the leap? Hmm. So their to to things. So the need peace was when we started sharing. Hey, we're feeling this with the other people. We knew other organizations. Everyone was, you know, having that same ah ha moment. And there was actually a book that came out called Madison Avenue manslaughter, where there were exposes on the ad world and the margins that people were taking the yacht trips that were happening on weekends. And so there was a huge industry recognition that was we were just at the cusp of So that was the wine that it was part of the Why now, why now was one on the technology side, the rise of the gig economy and then the second piece, Waas. The industry was awakening to it, and the relationships that were at the top to top on the agency and the client side, they were being overridden by the rise of procurement. And, you know, after the 2000 and eight financial crisis, the rise of procurement had really had a huge, huge impact. So I think that that's kind of part one to it. And I'm trying to think of if there was a oh, and then and then right and then I'd say the second thing for why leave and actually take a jump in doing it. So I had my resignation letter for letter written for 12 months on my desktop. Ready? Oh, you know what I mean? Like that constant feeling that we were ready, but just not quite ready. And I had spoken Teoh, a friend mentor at the time, and he had said, You know, Rachel, sometimes the riskiest thing to do is...

...actually to stay in your current gig because you can always go back. And lo and behold, when I did resign from J and J, they were wonderful and supportive and said, Hey, we're gonna you know, were brought into your problem. We're interested being a customer and then secondarily, they had shared. If it doesn't work out, you know, you're welcome to come back. And so I think, you know, for people that are high performing and have a drive to win and have delivered in their roles and, you know, have really shown that. And, you know I know, and I don't think we were special in that I know a number of other entrepreneurs where as they were leaving, there was that open door. You know, if it doesn't work, feel free to come back. So just bring that second point up of sometimes The riskiest thing is not to try, because that latter is always there. You can always keep ascending it, but to actually go out, Tinker, fail, try and succeed that that's something that, as you go on in your career, the opportunity cost just gets larger and larger and larger. Yeah. And so you dearest it Because you guess you knew Bram you had worked with him before you piloted. You've worked on projects with him. You knew that you worked well together. You validated it. It fit all of your criteria. You just knew at some point you wanted to leave like J and J. You knew in your mind was sort of a shorter term thing. Or was there a a version of your life where you could have been A J and J for the your your entire career? So now it's a great question, and it's getting a bit personal now. So in my life, I always feel like I need to have meaningful relationships in whatever way they come, great adventure and then to feel insanely challenged. And those can come in any way, shape or form. So adventure could have come. I was actually trying to go abroad with J and J and working in emerging markets. So I was really interested in India or Brazil. So if I would say to J and J and had an incredible adventure career wise with them doing that, that would have been something that would have really appealed to me or taking the entrepreneurial path, which both of those really would have checked that that adventure slash challenge box. So, to your question, like I think I'm always been the type of person of kind of planting by a bunch of scenes and see which one sprouting one and then just being really opportunistic around, you know, always saying yes, listening to different opportunities, putting myself out there to try and stumble into some luck. And then, you know, hopefully hopefully finding Cem Cem great and adventures along the way. Cool. So then you left. You said it was revenue funded. So J and J was your first one of your first customers? Yeah. Awesome. So had your customers lineup. Had your business partner figured out? Had you said you had started working on it, sort of on the side to try to validate it before you ended up leaving. Then how did you know? Like, after you left, how did you know what to do? First, Like, inevitable. Like there's inevitably this overwhelm of my gosh. Now I'm no longer collecting a paycheck. How did you know what to focus on? I mean, the reality is we didn't We made a lot of mistakes. Out the gate. One mistake fun fact incorporate ASAP. So that's something that's a lot of people wait to dio. But Canadian banks and our government really value time based on aspects to a company. So grant opportunities, banking opportunities as soon as the clock starts is really valuable. So feel free to incorporate now, even if you're working on a future idea so you can ride some of those two year to your opportunities. But what it actually say is that J and J taught us a lot about focus identifying a problem, building out a plan that's going to solve that problem. And I think the biggest thing to know and, you know, working with companies of the Dems afterwards is time is your most precious resource, and it's not infinite. So how do you really figure out, What are your three things you're going to accomplish in a month basis, week basis? Whatever Timeframe makes sense for you at that stage of your company and early days, it was, What are we doing today? Okay, here are the three things we're gonna get done over time. It became okay this month. We need to get X y and Z done. But I think being focused at a strategic level of what are the three things and then constantly recognizing when you thio to generate on that s o examples with five crowd are three things in year. In our first six months, let's say we're 100% customer satisfaction, so we recognize that we only had one reputation, and at the end of the day, you're going to...

...screw stuff up, especially in a new company. But you have to make sure that you make it right and take care of them and learn from it and make sure that they're, you know, expectations are set, that you are new and you're going to be learning. And then as a family clients, there's pros and cons. You can help infuse, you know, thoughts and ideas into the product. On the flip side, you're gonna have to fumble with us as we go. So I think you know, one was 100% customer satisfaction. The second was just getting through pipes. So we knew that we just needed to get work to freelancers so that we could learn what's needed, what features air needed, what features exist in competitive products versus what we think is needed. One example is that if you looked at at the time the lance no up work, if you factored in exchange rates was about 25% of a currency exchange rates or 25% fees charged if we were a Canadian client working with a European freelancer. So once you start under and those were just learning that we didn't realize until we actually just getting through, put onto the platform. So that was number two, and then we are Third one was cash is king dollar sign on the cash. And that was this idea. Everyone says, you know, the cash flow is key, but like cash flows really key because you in our world, we were servicing Fortune 1000 clients that had not payment terms of 180 days, Right? So aka from one we're done working together, you're gonna pay us in six months as your you know, putting work with freelancers and are freelancers were paid in 30 days, and so we had a huge cash, but we re that was like a catastrophic thing. Talking to investors. They're like, you're doing what with how many people you're floating, What for who And so I mean at the end of the day, the throughput allowed us to learn and iterating and solve that problem in a variety of creative ways, but those three goals and then figuring out what tactics we needed to dio in the first six months and was really, really valuable. And we always have this bucket called Operational Weeds. And there's all this stuff when you start a company that you don't realize whether it's finding an office, whether it's getting an HST number, whether it's all these ridiculous things that just come up that we just knew. Alright, that there's probably 10 to 20 hours a week that goes to this annoying stuff, but it's gonna have to get done. So hopefully that sheds a bit of light thio the ways we thought about it at the beginning, and then over time, those three goals evolved. And our team, you know, if we stop them in the hall, they'd be able to rattle them off whether it was a developer or customer success person. Yeah, it seems like your team Correct me if I'm wrong. Rachel, if you like this was either a dream or a real thing. We shared an office for a while, correct. We did. So this is a fun story. Eric and I, we we worked out of Tangerine Bank. Yeah, right. A brilliant. I don't know why Tangerine did this, because they offer business business accounts. But we paid 100 Canadian per month, have our whole team in this office at Young and shooter. So that's where yeah, we we got to know each other quite well, right? It always just struck me that your team seemed so organized. It was very early days for me at intelligence, and I just always looked at your team and thought, It just seems like at least you did a good job of pretending like you knew what you were doing, that you had your stuff together. So pretending. Yeah, you did a good job. A t least. Well, from the If you say that you felt disorganized, it was trial and error, at least from an outsider's perspective. It felt like watching you and Bram that it was very calculated and that you had, you know, very clear plan very clear goals, and we're executing on it. So I always looked to you as to that. Seemed to have it together. Even if it didn't feel like that in your mind, it seemed like that from the outside. Um okay. So fast Forward Company will ultimately was acquired by SGS. What was not the plan you said, like on your criteria Didn't fit the A company. That was easy to exit box. So what happened there? So again, a personal thing. So fun. Profit and scale have always been an impact story. So fun profit, scale and impact have all been very big personal motivators. And Graham and I often would, you know, pause and assess. How are we doing on the fun part? You know, Is this a slog? Are we waking up every day and dragging our feet is what we're doing? Profitable? Is it scalable? And...

...then, finally, are we having an impact on the world? And I've always had that, like, social impact piece that's been a huge part of my personal goals. And so we weren't for sale. We were delusion, millennials that we're building a billion dollar Silicon Valley company went down to the valley once once a year. So, you know, really immersing ourselves there and and essentially what happened was as we learned more about SGS, and as they got to know us, we realized how the sum of our parts is greater than the whole right. So, like, I think that it was very, very clear that if we brought the two together A we'd be able Thio access their 3000 clients, which was huge. We'd be able to bring a huge amount of work to meaningful freelancers around the world. And that's essentially what happened. Obviously, there were there were learnings and things that, you know, we're tough through an acquisition. But on the flip side, walmart dot com was a huge customer of SGS, and we brought we I think in our second year, were writing something like 100,000 copy descriptions for all their products on their site. So when you so when you look back at, okay, impact the scale piece, you know the acquisition Definitely check those boxes and was ableto bring work to freelancers which ultimately was, you know, which ultimately was our vision of what motivated us. So hopefully that helps Thio answer it. Yeah. Okay. So fast forward. You are now at entrepreneur. First, we know a little bit about the organization, but maybe you can wrap it up a little bit. What does it Dio. And then the reason why I thought it was super interesting to bring you on is because that you've sort of come up with the idea and executed on the idea from an entrepreneur's perspective and on entrepreneur First. It's different in that you invest in the people and then come up with or help them come up with good ideas. So a lot of the questions that I'm seeing from students are around. How do you figure that out? How do you help them coach them to the right idea? So, big question, What is entrepreneur first and then we'll talk about how you your process and then how you help them come up with cool ideas. Yeah, great question. And a lot of people thought our founders were crazy back in 2011 when they started, because essentially, their idea was we're gonna pay people to quit their jobs. We're gonna put them together and then invest in them. And so, obviously of the gate, you know, there was a lot of like had had turns, and but essentially, what happened? Waas. They did just that. They brought 50 individuals together twice a year, and now Toronto is the sixth location, and these individuals are truly exceptional. So, you know, absolutely extraordinary. And I could tell you more, but what we look for, but this is the best of the best in the country. And we look for people that have insane high potential. So we look for folks that are, you know, crazy driven, uh, that have that ability, Thio grow and we can help accelerate it. So what we do is we look for those individuals. We bring them together in a cohort and the cohorts comprised of CEO profiles and CTO profiles. And then we essentially let the magic unfold. So we help to facilitate through a lot of, you know, frameworks which I can share a bit more about team building. And then essentially everyone pairs up in the court at the end of 13 weeks. They then pitched to us very much like Dragon's den. And then we may have the decision whether or not we invest. And our investment terms are 100 K Canadian in exchange for 10% of the company. So from the beginning of the program, you don't have a co founder. You don't have an idea you're getting paid 3500 Canadian per month is a stipend. 13 weeks in. You pitch to us and you basically have a million dollar valuation. Second part of it is at that point, and it's more of a traditional incubator where we help you go to market and raise institutional funding. So that's it. That's a bit about us. And and the only other thing I'll share is is maybe why I wanted to join an entrepreneur first. You know, I definitely have another Chapter two of being an entrepreneur, and I absolutely brand, and I at some point we'll well, join forces again and be crazy and have a ton of fun, you know, having impact in some kind of space. But what I loved about the F is that when you when you look at Toronto in Canada, we have an incredible, incredible pool of talent.

But we have this profile on stereotype of being a bit more risk averse. You know, without that structure, it's hard for us to take the leap. And so what I loved with F is that we can find the best people that have not yet started companies. Yeah, and help give them a time box and structured way to take a shot on themselves. And if it doesn't work, no problem. You go back to a J and J, you go back to a bank, you go back to wherever you were before. And so I just thought it was perfect for the Canadian profile. And it's such a exciting space that we don't really have any other offerings in our market around pre idea pre company pre co founder. So I just thought I just saw the opportunity and how impactful would be movie for Toronto in Canada. Awesome. Okay, so then what is that process? How do you see you? I get how you pick the people you put them together and how the compensation evaluation works. How do you coach them to the right idea? Do you offer them criteria or the boot camps? Give us a peer into the E F program? What is what do you do to help them come up with the right idea? So we believe very strongly and what we've called our edge framework. So essentially, what that is is we profile four different types of archetypes and we structure our cohorts toe have these four profile, So it kind of talk through them because it's the way that we approach ideation. So the first is a technical edge. So this is someone who's maybe, you know, 0 to 2 years out of their PhD. They've got really cutting edge forward thinking, research, that game changing industry. So that's, you know, a pretty typical technical edge. It would likely be a CTO. The second technical person is what we call a catalyst Duer. So this is an individual that can build. They can lead and you know they can command followership. And they likely have some work experience, you know, potentially in a startup or in a lab. And, you know, they maybe don't have the same very deep technical expertise. But they've got broad, broad experience from a building perspective, and they're the best in their field. The other two are more of our CEO profiles, and one is what we call a catalyst talker. So it sounds. It sounds kind of funny, but if somebody can catalyze the business through customer discovery, operation sales, all that kind of stuff, most of our I'd say almost everyone in the cohort is somewhat technical, so and the technical could be you just read a ton of stuff in the tech space. It could be, You know, you've tinkered on projects outside of work, but there is some. Or maybe your undergrad was in and something technical. But usually we, you know, we find that our CEO's that have a bit of a technical understanding just perform better from a from an investment. In a company standpoint, the final call it edge that we look at is what we call domain expertise. So this could be someone that has years of experience in this specific field. Maybe they worked all their for banks, and they know the ins and outs of the you know, the banking system and have the right to win because of their unique domain expertise. And so when we look at these edges in the composition within our cohort, we we use the analogy of poker, and we say, You know, everyone probably has, you know, a set of different cards that you could play. But the key is figuring out what's your highest card? What's your ace and then what? Someone else's ace. So when you bring them together. You're very, very differentiated and part of what has attracted such great investors. TF. So we're backed by some of the world's best investors, like Greylock Partners Reid Hoffman, the co founder of Like Dinar Fund 140 million. Part of what attracted them is that they've said, huh? You take two very strong people that you've prevented for crazy drive to achieve their ability to commercialize things all the personality stuff, inability stuff. And when you bring the two together and it's almost I p in itself, because the two individuals are so competitive that when that comes together and you start talking about your interest, when you start talking about your experiences because they're so different yet they're your ace in each of the hands. Quite often the ideation actually comes quite naturally, so we view that ideation and team building or symbiotic and actually go hand in hand. Final thing I'll share on this is that through our program in the 13 weeks we...

...believe very I'll use a bad term, whether we believe very strongly in monogamy, like stay with one co founder, go deep and test that relationship like crazy and then break up if it's not working. So we do not advocate for having, like, five conversations going on at a time. By the end of the first week of the program, about 90% are actually in their co founder teams, and then it usually takes 4 to 5 formations and breakup before you actually get to your your strong, the strong winning team. Interesting thing edge framework. Is that something that's unique to you? Or is that Yeah, so that that is proprietary to E. F. But I'd say that we've got a ton of information out there on it. I think our co founder, Matt, just did something on Invest like the best kind of speaking to that framework and how you know those aces. And when you look at the cards that you potentially have, how that really becomes the foundation for for your skill set, the one thing I'll share is we have had people that have I'll pick on one specific story. People that have maybe worked in law for 10 years or have, you know, worked in a specific industry, and they're like, great, I'm in the f. I want nothing to do with law. This is going to be my ticket to get out of law. And what will often say is like, You're crazy, You're competitive advantage. And your right toe win is in the legal space. Like you got to double down as much as you might want to leave. This is not the avenue. Do it right. And so and that specific example. It ended up being a co founder. That is, you know, one of our most successful companies. I was like, All right, I guess I'll do my legal thing. I guess I know this space. Uh, but we we really try and push and encourage folks toe. Think about why then And why now? Because really, at the end of the day, that z what investors are going to care about and that's going to be your best chance Success? Yeah. Yeah. Okay. Cool. So I want to get thio. I do wanna leave some time for questions, and I'm looking at the questions that have been up voted the most here. I'm gonna rewind to something towards the beginning. Martina, if you're on instead of me trying to paraphrase your question, do you mind coming off mute and asking Rachel your question. Yeah, sure. Thank you for joining us, Rachel. So my question had to do with reading about the Entrepreneur First program. It's indicated that the end of week eight of form about 80% of the cohort is already found their co founder and then the remaining people that have not been able to find a co founder. They have to leave the program. So I know like looking at the website, it's clear that you select individuals that are highly ambitious, very qualified to be successful in the program. But since they had to leave, could you comment on what processes differentiates those that are successful in that form part of the program and those that couldn't, uh, advanced to the next stage for sure, Great question. And so well researched this amazing Martina throw that that the word of the F is getting out. There s so a couple of things you hit on one thing, which is this idea of success who has been successful or not in the program. And when I first joined the f, you know, to really understand the program, I spoke to a bunch of our past customers who are alumni and both folks that were successful, not successful to to use your words. And what I learned was that most people actually felt like they were successful, whether they ended up getting funded with the F or not. Because it's a transformational life experience where all of a sudden maybe you were working in an environment where some people were okay, some people weren't. And then all of a sudden, you know, what I heard from our alumni was they got to be f and was like, Holy crap, these are my people, you know, you can jam on different things. You, you know, potentially have a huge, you know, hard right on where you go from your career perspective. So I'll just speak to the fact that those that don't end up getting funded or end up having a company that they feel that they want to pursue. Many individuals end up joining our alumni companies. So our alumni actually love our subsequent cohorts because it ends up being a talent final for them. And then since we launched in Toronto, we've had recruiters chomping at the bit to say,...

...like can we see your talent. Can we see your talent? Because we betted the best and brightest in Canada that want Thio, you know, start companies. So we've already prevented a lot. So I just wanted to get on that idea of success versus not because, you know, I'd say the majority of people are not going to be funded. It works such about 40% that end up getting funded by us at our investment committee. But that doesn't mean it's unsuccessful. So But to answer your question of what differentiates the ones that end up getting funding versus not, I'd say there's a couple of things. One big mistake that we see a lot of companies make is they stay in teams way too long. So maybe they got along really well with someone, you know, Maybe, you know, Martina and I repaired up and we had so much fun together, but at the end of the day, we didn't have a strong enough right to win, and we didn't actually have some of the tough conversations that were that needed to happen. And so what ends up happening is some of that ends up getting back loaded and So you end up realizing that I'll pick on an example. Our values are super misaligned, and you realize that two weeks before investment committee and then the team breaks. So that's one example of something that maybe goes wrong. I think another example of people choose not to work on their edge. And then what ends up happening is you have people pitching. And when you ask the question, why you by now, which are not yet questions? Those were like very common investor questions. You know, those were those were tough to answer. And so, you know, I think it's pretty safe to say when you stick to your edge and when you're really, really honest about pressure testing the problem that you're working on in a potential solution, we use the term your you know, what's your belief based on your edge? And then what's that hunch that you want Thio lean and in test and when you can do that effectively, You know, I'd say most people have been have been really successful in the program. Great question. I'm gonna go to Priya. Do you mind asking your question? Yeah, for sure. Thank you so much. for coming in. I basically just had a question about your experience being a female entrepreneur and just understanding, like how you assert yourself in the field that's just so predominantly male dominated. Yeah, great question. And I might answer this one in a less politically correct way. So bear with me as I do that. So we'll edit this out. Rachel, if you in post. Amazing, Amazing post. I love. So So here's what I'd say. And it was never something I thought of it. It was something that, you know, I had delusional naivety to, and I think it was about a year into starting five crowd. All this buzz about females and tech. You know what we need to think about it? The table, how we need thio act in different things. I think once I started getting that the voice in my head saying like, Okay, I'm the only female here like how do I act? What do we need to dio? It became a really negative a imposter syndrome moment, and then the self fulfilling prophecy when I was second guessing myself then, therefore, that's what was happening in those situations, and I think it was Brand who was like a month into that phase that I was going. He was like, Great, What's going on is like, I don't know, but women in Tech and he's like, Okay, here's like Oh, good point. And so once I got rid of that and kind of got that that that, you know, voice track off and actually what we flipped to as the fact that we were co founders a za profits that U S. Which we laughed at the time. But it's true. He was like, You guys are very lucky. One of you is a female. One of you is a male play to your strength, and what that meant was that there's lots of female and tech experiences that I was able to go and meet and learn from. And then there were also lots of boys clubs where I could have gone and I would have been comfortable. But maybe we just send brand because that's actually probably a better fit. So I think whether or not you have a co founder, that's male. I think you can manage without but But I guess my biggest messages. If you put the spotlight on it. At least in my case, it actually became a self fulfilling prophecy versus just trying to be delusional to it a little bit and have that bright eyed naivety, Um, and stumbling into it, as you know, that that did really happen. So it makes sense. Yeah. No, that makes a lot of sense. Thank you. That's a good question. All right. Zach has a question related to Cove it if you wanna go for it. Zack.

Yeah, I was just curious in terms of numbers. Um, you know, I think there you can make arguments from both sides, I guess. But, you know, since since Covas started have you seen maybe an increase or decrease in interest, you know, in entrepreneur first or entrepreneurship in general, if you have any insight on that great question eso Here's how I answered. So first off on the investor front, I'll start there and then I'll go to the to the Canada applicant. Friends on the investor front investments are healthy. You know what I've been seeing, You know, as we've been launching in Canada as I've been, you know? Sure. Talking Thio. My contacts in the Valley investments are still flowing. And so there's obviously industries where that's not true. I'd be a little bit, have trepidations around, launching something and travel, for example, or retail, for example. Maybe you've got a huge game changing solution based on the changes but their industries that talking to my friends that are VCs in the Valley. Maybe they're writing those things off in their portfolio and doubling down in other areas. So start on that on the investor friend. On the flip side on the founder front, I would say, is that the most ambitious people see opportunity in turbulent times, right? They see the changing and economy. They see the changing consumer habits. And I think that, you know, when you when you see those opportunities, you know that's when the mind starts. Racing is like, Oh, wow, this shifting behaviors happening. How do I tap into it? So to give you some specific numbers in Canada, we have close to 1000 applications for the 50 spots, so I don't have a barometer for previous cohorts. But I thought that was quite a lot and we did not have heavy marketing up until we had a little bit of press at the end, right as we were closing your applications. But I was pretty blown away by that because that's 1000 very strong people that want to take a leap like this. You know, one thing that I was seeing was that some people may be a bit more risk averse by way of looking for leave of absences. So can you. In my world could I have left to J and J and taken six months and have that security of going back? But, you know, I just came off of a called part of this, talking to someone who's interested in April cohort. And, you know, what she had said was, You know, I'm a strong performer. I could take a leave of absence, or I think I'd have an opportunity like s. So I think there is a bit event, you know, those those that have that performance background. There's a bit of confidence that now is the time. If not now, then one and then I should be able to find an opportunity. Should I need to go back into the workforce. Great. Thank you. Any advice to your call it 21? 22 year old self. Rachel, would you have done it differently? Would you have started earlier? Any advice that you give to these thes, arguably the most entrepreneurial students at Ivy who are taking courses? And they're sort of self selecting and saying, I'm interested in learning more about entrepreneurship. Any advice to either them or to your 21 year old self? Stay in touch with me. But that's more me to putting that out there because hopefully all of you will go into the workforce and be interested in you have down the road. But that's not That's not your question. Um, look, I'd say a couple of things right. I think there's no substitute for hard work, and I think our generation could get a reputation of like wanting to be the CEO in 12 months. And at the end of the day, it takes time to learn stuff. So just have some on one hand, have some patients that it's going to take time to learn, be a sponge on everything tech as well as on the commercial ality side. On the flip side, I had once been given the feedback, constructive feedback A J and J that I'm impatient and I can see that I'm like a sense of urgency. We bought the three goals for five crowd. Why is it taking six months? Let's do it tomorrow. On the flip side, one of the things we actually see from any perspective is some of our strongest founders have an insane sense of urgency, and they have that in patients. And so what I'd say is that, you know, be a sponge learn. And if I could go back to that advice that I was given, I think I would have said to ignore it. And that in patients is what drives speed. It's what drives impact. And then perhaps, you know, the last piece to it all is be very, very focused. You know, Rachel, circa 13,012...

...on just general learning and just always putting myself in, you know, in situations where you could just soak up a ton and as soon as you feel like you're getting stale, leave do something else. Goto go to Brazil, as I was trying to do with J and J. Start something go to a different company because our crews air long. But they're not that long. And the more tools you can assemble in your tool, kid. You know, I think the better you'll be longer term. But stay in touch. Stay in touch. The F, sir. Good. Two years from now, you've been listening to the Ivy entrepreneur podcast toe. Ensure that you never miss an episode. Subscribe to the show in your favorite podcast player or visit ivy dot c a forward slash entrepreneurship. Thank you so much for listening until next time. Yeah.

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