If you need an example of how entrepreneurs can successfully leverage their connections to build their startup, look no further than Tettra, the Somerville-based wiki-software-for-Slack startup led by HubSpot alums Andy Cook and Nelson Joyce that launched into public beta this week and has racked up more than a dozen paying customers so far.
Cook and Joyce just closed a $914,000 seed round from several angel investors, and it's nearly double the amount they were originally planning to raise. What's more, a little more than half of the investors represent present and former HubSpot employees and executives — including CEO Brian Halligan, CTO Dharmesh Shah and former CMO Mike Volpe, who led the round — and another 27 percent represent some of HubSpot's original angel investors.
In other words, it's good to be a part of the HubSpot Mafia, the ever-growing family of former HubSpot employees and executives who leave to launch their own startups. This group includes Drift, Appcues, Quantopian and Crayon.
In an interview with BostInno, Cook said there's a few reasons he and Joyce were able to pull off this round in less than a month. For one, he had experience raising money with a previous startup he founded with his brother, Alex, called Rentabilities, which was acquired by HubSpot in 2014. Also that acquisition brought him onto HubSpot's team and exposed him to a number of people who are supportive of Boston's tech ecosystem.
Cook said if he had one piece of advice to entrepreneurs looking to raise their first round of funding, "it would be to start building relationships with angel investors well before you're actually raising money." And with Cook and Joyce having led development on a new product called Leadin at HubSpot, it put them in the right place at the right time.
"When you leave to go start your startup, one of those people you met will likely be a believer in you and may fund you before you really have much of anything."
"Really the difference maker is the time I spent at HubSpot working on Leadin," Cook said. "That's how I met Mike Volpe and got to know David Cancel. Ultimately, two years after being at HubSpot, both of them invested in us because they knew we could build a product from the ground up together as a team."
Cook said Volpe and Cancel were so confident in him and Joyce they decided to invest before Tettra had a product in the wild.
"A good hack is to work at a more established company like HubSpot that has a great brand and a dozen or so angel investors inside its walls, then do whatever you can to get in front of those people to impress them," Cook said.
"When you leave to go start your startup, one of those people you met will likely be a believer in you and may fund you before you really have much of anything," he added. "You can then use that person's stamp of approval as social proof that you're fundable and also tap into her network too which really helps."
Beyond the connections at HubSpot and past experience of fundraising, Cook said the use of AngelList and its investor syndicates was significant in connecting Tettra with more investors through Volpe's network and gaining more momentum.
Cook said Tettra will use the funding to hire engineers to accelerate product development and launch more features, as well as hire people in marketing. "It's more than two people could ever handle on our own, so it'll really help to have more people building the product with us," he added.
