Justin Kan | Hustle Con 2018

Justin Kan

How are you hustle con it's me justin here to tell you teach you something I'm gonna I'm gonna teach you one thing at least and we'll see what that is alright cool so that was you know you've probably I won't belabor you on on background I started a lot of companies the one that worked was twitch I also invested in a lot of companies kind of seen all sorts of every side of the market and that really informed this new business that I started called atrium so I came here I want to tell you about atrium and I want to tell you about some of the growth hacks that I used to get us going because it's been about exactly a year now in june we celebrated atrium's first birthday june 12th I think so you can wish me a happy birthday all right so why did I start atrium well at first I was very brain damaged from twitch and when you start a consumer startup as many of you probably will find out people don't really want to pay you they don't want to pay you very much but so when I was thinking about what should I do next what startup should I start I really really wanted to do something where you get paid and so there was one constant in our entire twitch journey which was we always no matter how we were doing as a business the amount we paid our attorneys always went up and that's sadly true and so I was like that seems like a very interesting business to do at the same time I was a partner at yc I felt like I'd stopped learning I'd stopped levelling up and I wanted to build something into a big industry where I felt like I could continue to scale because we grew twitch it was about 170 people when amazon acquired it I want to build a big business something bigger than that and I felt like the legal market was something that would support that and then lastly I'd been an experienced client as I like to say I was an involuntary power user of corporate legal services and so I was like well I know what people want and I feel like I can deliver it and what did they want well here are the problems I faced with legal really quickly pricing seemed like playing russian roulette when I would open those legal bills sometimes there was highly variable response time when I was working on a very important thing where it was like an m and a or a fundraising round the quality of service was super high but oftentimes when we wanted to do something else that wasn't as important it was you know we'd be waiting for a long time for a response the quality itself was very variable oftentimes there were mistakes because there's a lot done by hand and then there's very little transparency into the process like I didn't know what the steps were for anything I wanted to do like a fundraising round what are the steps from getting legal is not the end state I wanted to get money in the bank or I want to sell my company I always wanted to do something and legal is just a blocker and when there was no transparency to what was happening I was very frustrated so we decided to solve that with a couple of different things strategies moving everything to fixed pricing so we a incentive to make things more efficient over time increasing role specialization so that we can increase response times and and and kind of right size all the legal work we're building all this technology to do stuff behind the scenes to actually lower costs and then we're starting with startups that's you guys in the room because that's what I know and startups they might start small but eventually if they become the next airbnb or uber they end up spending a lot on legal and so to get to the good stuff here are the growth hacks when I started the company there were a couple of things that I did to really kick start the process and grow it pretty quickly so to date atrium has done over $500,000,000 in new primary financings for clients we have over 2 40 clients here in silicon valley and around the country and I think we've done a pretty good job we scaled from a team of 4 people to 80 people in this last year so done some things okay but there's still a lot to do all I see is problems and there's a long road ahead of you one thing I should say is no matter who you are it never gets easier that's a lot of nervous laughter but that's actually true it's so so if you feel stressed out if you feel like you're struggling with your startup you know it might be early days but you should just know that I'm feeling the same pain somewhere in the world probably in san francisco I'm probably banging my head against the table on something that's not scaling exactly right I thought it would be easier actually this time so that was my mistake alright on to the growth hacks so the first one was when we started off I was like will anyone hire a start up law firm and in fact lots of people were like nobody will ever trust their sensitive legal work to a new startup that's unproven and so what we did was we ended up hiring top talent and trying to leverage their credibility so first thing I did was I realized we couldn't start atrium without a expert senior attorney who had a ton of experience and I ended up because I'm not I've been on the client side but I've never been on the legal service provider side so we ended up spending I spent a lot of time months months months talking to different partners seeing who's interested in kind of innovating in the space people who had been successful in their careers at other firms and eventually decided to co found atrium with my current co founder augie rayko who is a partner at oric on the emerging companies vc practice and so augie had a great book of business he was known as someone who was very interested in kind of innovating but also like really founder friendly and great at building client development and so we got along super well we ended up meeting because he actually represented my brother's company cruise automation through their sale to gm for a $1,000,000,000 the year before and so so we got to we we sat down a lot got to know each other and really put a lot of thought pre work into building this business together then after that augie you know augie kind of broke the dam and we were able to hire a bunch of talented attorneys from top firms here in silicon valley and so when we went to founders we were able to say hey we can offer the same levels of service that you can expect from other firms and I think that that was a huge piece of the puzzle because we were legitimately able to say hey if you are going to go with this other firm we can do the same amount of work but we promise we're going to fix the pricing and we're going to do it you know we're going to improve our quality of service we're going to improve our response time we're going to lower your cost because we have built this technology that's going to streamline the delivery of service and it worked that was not obvious to me that it would work at first but it did which is really good so what was the second thing we did we decided to try to help founders with additional value outside of just the legal services so in the very beginning like literally a year ago we were sitting around and we were like how are we going to get any clients and the way what I I started off the whole thing by just posting on a forum for founders I actually was on the internal yc forum and I said hey if you are thinking about going through a fundraising process soon for like a series a financing series b financing something like that I would love to get customer feedback from you I just want to learn about how you're thinking about that process and do some customer development for my new company and in exchange what I'll do is I will help you on your pitch I'll give you some pitch feedback because I've raised about $80,000,000 in fundraising from venture capitalists and angel investors and seed investors so far and I think I have a lot of you know kind of firm beliefs on how you improve the narrative and your pitch narrative and I could probably help you out so let's like let's do a trade and so I did that with one of my friends actually who has this company called messagebird which helps helps people send you know it's basically a chat like a sms and phone api and sat down with him he had a great business his business is growing super fast they're on track to do I think $80,000,000 in revenue that year and I sat down with him and he was like I can't get any traction with investors you know what's going wrong and so helped him out with his narrative and 2 weeks later he had a term sheet ended up raising $60,000,000 so it wasn't quite as simple as that but you know I did really help improve his process and so he you know then at that.

Justin Kan

When he had the term sheet I was like hey you know we have this law firm if you'd like to maybe you could consider using it and he was excitedly was like yeah sure I'd love to give you guys give atrium a try and that's how we kicked it off so we eventually did a bunch of experiments over the summer helping people out and we decided to professionalize it we said hey we can batch process this by running a free boot camp every quarter I think we've set it up being every couple of months and so that's what we do we called it atrium scale and we help founders raise money and figure out what their fundraising strategy is because it's effectively a lead gen event for our atrium services so that's worked pretty well in fact we've had over I think 60 founders go through our boot camp over the last 6 months and I think about a quarter of them ended up raising series a or series b okay so growth hack number 3 atrium's series a our own series a fundraising so when we went out to start this business we thought maybe I can jump start it by having all of our investors or our future investors because there weren't investors yet maybe I can jump start it by having all of them basically become our channel partners and so the way we created our round was we ended up raising money from 1 lead who set the terms that was general catalyst and then we ended up basically well I guess we used our credibility and hustle to get in the room and we ended up talking to about 100 investors total and I just pitched I was like pitching nonstop like day after day and got everyone to participate with this like a little amount you know 100,000 or 500,000 I was just trying to raise like as kind of like a small amount from everybody in silicon valley and the reason I wanted to do that was twofold number 1 I didn't want people to block us just like I was worried founders would be nervous that there was about having a new firm I thought investors would be super nervous right because investors you know what's the.

Justin Kan

Of like why innovate here? The founder is kind of the one that's bearing the pain. He should just like suck it up and maybe use their existing firm that I've heard about. Right, I was worried about that, so I went out and I tried to pitch everyone in Silicon Valley. The second reason that I thought this would be useful is that we would be able to ask them to refer us to their portfolios. This would really make those investors believe that they could help us grow and that they'd have a direct influence in helping us be more successful. So, we ended up doing that, and here are some of the results. I think I already talked about that one. Atrium's scale has grown pretty well. We've been able to grow that from this large base of startups here in Silicon Valley. We ended up raising from almost everybody in Silicon Valley. We had participation from all of these different top-tier investors, and they've done a great job of referring us to this portfolio of over 240 clients who have tried Atrium to date. In fact, 25% of those clients come from our investors. Alright, so last up, how I can help further: you can email us at Atrium if you need any sort of legal help at Atrium Scale. I encourage you all to apply if you're thinking about raising venture fund fundraising in the future. It's been pretty effective so far. I think there's one last thing: we have a special discount for any of the founders in the room today. You just look for someone in an Atrium in an orange t-shirt and go find them to claim it. So that's all I've got for you today. Thank you very much, and I'll talk to you later. Bye!