Netflix Co-Founder Marc Randolph Reveals the Magic Formula for Grabbing an Investor's Attention | Elevator Pitch S11 EP4
If there is one thing founders can count on while fundraising, it's this: You're going to hear the word "no" a lot from investors.
But contestants on this episode of Entrepreneur Elevator Pitch are undeterred by that harsh reality and show up with their game faces on, determined to turn those nos into yesses and walk out of the boardroom with life-changing investments.
But contestants on this episode of Entrepreneur Elevator Pitch are undeterred by that harsh reality and show up with their game faces on, determined to turn those nos into yesses and walk out of the boardroom with life-changing investments.
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00:00Hello, investors. Welcome to the elevator. Going up. I'm Mark Randolph, co-founder and
00:11first CEO of Netflix. I'm Kim Perel, CEO of 100 Knot Co. and serial entrepreneur. I'm
00:16Dhani Jones, former NFL player, serial entrepreneur. And today I'm seeking entrepreneurs who are
00:21creating revolutionary software. This is Entrepreneur Elevator Pitch. Presented by
00:30Amazon Business. Kicking off are two entrepreneurs who hope to bring more music to the world
00:42with their gaming software. We develop audio responsive video games for music students.
00:49It's all about getting kids excited and engaged and playing music every day. I was studying
00:54composition in college and that's where I overheard this guy talking about wanting to
00:58make an app that makes practicing music more fun for students. Like, oh my God, we're trying
01:02to do the same thing here. You know, it's fun to like take what we're passionate about
01:07and turn it into a business. Going up. Hello, Steven and Aspen. Welcome to the elevator.
01:22Your pitch begins in 3, 2, 1. We were devastated when we burned out studying music in college.
01:31We struggled to find the motivation to pick up our instrument and practice. And we're
01:35not alone. 90% of music students quit in the first two years. But here's the secret.
01:42Half the planet plays video games over an hour a day. We're Overture Games, guitar hero
01:47for real instruments. For the 48 million music students in the U.S., we develop video games
01:53that listen to students and give them live feedback. One super user was so captivated
01:59he played through a song 947 times. And I'm a serial entrepreneur in the music space while
02:05Aspen has been making games in the past 10 years. We're also both honored to be on the
02:08Forbes 30 under 30 list. We currently have more than 500 users from 12 different countries
02:13and we raised $400,000 left at honors fund, Techstars, plus grants from three top universities.
02:19Today we're seeking $100,000 at a six mil valuation to complete our pre-seed route.
02:24Join us and let's change the future of music education. Interesting business. Not a lot
02:32of users, only 500. So small maybe. Well, yeah, not only is it small, but all of a sudden
02:37they're in multiple countries. But on the other hand, music is kind of an international
02:42language. Yeah, it's a digital business. So global makes sense to me, but it's a game.
02:47It's a game. Or is it a music lesson? Hero. Now they said that, you know what, 90% quit
02:52within two years. I'm going to guess that, you know, 89% quit within two weeks. I would,
02:57I would agree with that. It is a real problem, but it also says it's hard. And I'm not even
03:02sure a game is going to get you over that hump. Maybe we put it to a vote. Let's do it.
03:06Attention, Steven and Desmond, your pitch has been denied.
03:27I thought it's an interesting idea, but A, it's very early and I'm just not the right
03:31audience. You're going to hear a thousand no's as an entrepreneur and you have to find
03:36the right audience because it just takes one yes. Yeah. You know, I think they're trying
03:40to get too many things in, but they really should have said, what's the most important
03:44thing they can say that's going to get us to really react? And I just didn't hear it.
03:48Our experience in the elevator was actually pretty great. Um, we had a good time pitching.
03:52We're well prepared, a little bit nervous, but you know, we thought we did a good job.
03:55I think the investors missed out and I'd love to hear what their feedback was. The future
03:59of Overture Games, we're launching on mobile pretty soon. Um, so we'll get the game out
04:03there in the world and hopefully we'll get more investment down the road.
04:12Our next entrepreneur is bringing top tier investing in financial management to the doorstep
04:18of the masses.
04:30Going up. Hello Sajil. Welcome to the elevator. Your pitch begins in three, two, one.
04:45Hi, my name is Sajil Kaur. I'm the founder and CEO of Capital Wise. 67% of the Americans
04:51are under financial stress. Even then, there is a misconception that financial advisors
04:56are for wealthy. At Capital Wise, we are helping these massively and financially stressed people
05:03to find the right financial advisors. And we do that through a unique technology that
05:07we distribute through financial influences. On the other hand, we have financial advisors
05:13and financial planners who want to expand their book of business. And we provide them
05:20with high intent investor leads and also an AI enabled SaaS platform to engage and convert
05:26those leads. We have more than 40 paying clients. We have raised 900K and we are looking to
05:32raise another 500K at 12 million valuation. Thank you.
05:39There's time on the clock. Come on. That's it. Well, I guess better than going over,
05:46I suppose. I know, but you get 60 seconds. You should use every, every second of that
05:51to ensure you're getting out of that elevator, right? Sometimes it's not about the amount
05:55of time. It's about delivery of the message. And I think that his message was great. I
05:59think what he's talking about in terms of the education market is critical. So I think
06:03the timing is perfect. I think he did a good pitch. I love that he has paying clients.
06:08So for me, he at least has shown that proof of concept in market. It's small, though.
06:13It's not that many people. Again, we have issues with getting to size and scalability
06:18and he's asking for a lot of money. So I'm kind of conflicted. All right, well, let's
06:21vote on it. Are you guys ready? Yep. Attention. Your pitch has been approved. Welcome to
06:46the boardroom. Welcome. You did a great pitch. We were very impressed. You had a few seconds.
06:52You could have added something else in there. But overall, you were unanimously voted into
06:57the boardroom. Tell us a little bit about your story. Why are you so passionate about
07:01creating this company? I came to United States in 2008. And when I landed here, I didn't
07:07have anyone to give me any direction on how to do your finance. Nobody teaches financial
07:12wellness in the college. So that's why that's the reason I built the platform to provide
07:17them with the right education on the financial wellness side and also on the business side.
07:22So we have two revenue streams. One is the SaaS platform, which is an AI enabled SaaS
07:27platform we built for financial professionals. And on the other hand, we have marketplace
07:32where we are bringing high end investor prospects onto our platform. And we match those prospects
07:39to financial indices and planners. I guess I'm a little confused about the marketplace.
07:44What are the two sides and what are they both looking for? On the marketplace, we provide
07:49something like Google ads for financial wellness that is given to publishers and influencers.
07:55And they include those widgets or whatever that adds in their content that funnel leads
08:00to us. And we distribute those leads to our clients. And on the publishers and influencers
08:06side, this is an additional revenue opportunity for monetizing their content. And we are paying
08:11them 12 times more than what Google is probably paying them. So there are two revenue streams.
08:15One is a cost per lead. And that depends on the investable income or investable asset
08:21of the prospect from $40 to $150 per lead. And we introduce the same lead to three addresses.
08:28So that is turning to $120 to $600 for a lead. On the platform side, that is priced $396
08:35a month.
08:36So normally, when I first of all hear the elevator pitch, or if not, within the first
08:44minute or two, someone's in the boardroom, I get it. And I still kind of don't get it.
08:50It may just be the business is a little complicated, but I'll be frank, I'm bamboozled here. And
08:58if I can't immediately grasp what this is, so that I can then begin digging at the details,
09:03there's a sign to me that it's probably not for me. And unfortunately, because of that,
09:09I just don't get it. And so I have to pass.
09:14I too am still a little confused from the two revenue streams, because usually I would
09:18look at a B2B SaaS company, it's very clear who the customer is, how much they're paying
09:23a month, I can understand how they're going to scale it, I get the business, I'm actually
09:27questioning, should you be just focusing on one of these businesses and just trying to
09:33scale that just given the complexity and lack of focus, I'm going to pass.
09:38I feel like I want to learn a little bit more about your business. But when you're coming
09:43to the boardroom to give us a pitch, you only have a couple of seconds in order to be able
09:48to do that. So to be concise, and to be direct, and to be able to show growth of a business
09:55is going to be imperative. And I don't feel like I got that information in order for me
09:59to be comfortable with being able to invest in your business. So I too will pass.
10:04All right. Yeah, thanks a lot. Yeah. Appreciate it. Thank you so much. Good luck.
10:10It was little stressful because I had to pitch the whole company within one minute. So I
10:16do feel like the investors have missed out because this is a very unique model. Even
10:20though the money would have helped us, that was not the primary reason for us to come
10:24here. So future is wise.
10:26I mean, the numbers are great.
10:28I wanted to.
10:29I wanted to.
10:30I wanted to.
10:31Too many times in pitches, it's overcomplicated.
10:33When you come out of that door, everything you say should make it clearer, should make
10:38it more compelling and more powerful. And unfortunately, I felt we were going backwards.
10:43It just goes to show clarity, clarity, clarity. Maybe we'll get the clarity we're looking
10:48for the next pitch.
10:54Our next batch of entrepreneurs stepped into the elevator with hopes of making it to the
10:59top floor.
11:00Going up.
11:01Morning, Greg. And pretty much plug it in, download it. Very simple. And just let it
11:08run.
11:09I can't even believe this.
11:11We have an app where you can see all the animals, the little animals. I forgot, guys. Sorry.
11:21With that AI-based app, you just snap a photo of the food you're about to eat, and our software
11:28will calculate the micronutrients. Is this a joke?
11:33But never reached the boardroom, as they were sent right back down with nothing to show.
11:39Wasting our time.
11:45Entrepreneur Elevator Pitch is presented by Amazon Business. For every organization at
11:50every stage of growth.
11:57Next up is an entrepreneur who's developed a way to level the playing field and simplify
12:03the process of collegiate applications.
12:06I'm Shantia Lee with College Thriver Education. College Thriver Education is actually an AI-guided
12:11platform that serves first-generation and underserved students, helping them get matched
12:16to their ideal college and scholarships.
12:19I remember the struggle of going to college as a first-generation student, and I was like,
12:23let me do something about it.
12:29Going up.
12:31Hello, Shantia. Welcome to the elevator. Your pitch begins in three, two, one.
12:42Whether you choose to attend college is one of the most important decisions you will ever
12:47make. So why is the process so confusing?
12:50I'm Shantia Lee, a first-generation student, college student, and admissions expert with
12:55over 10 years' experience, and I had so many challenges trying to get to college, jumping
13:00around from major to major, struggling with over $120,000 in student loan debt, and it
13:05actually took me seven years to complete my degree.
13:08Well, over the last 10 years as a college admissions expert, I realized what was missing
13:13on the market, so I built it. College Thriver is going to be an AI-guided platform that
13:18aligns students to the best-fit college based on their academic readiness. We can also match
13:23students to actual scholarships to help eliminate the student loan debt. The EdTAP market is
13:29booming at a $3.69 billion opportunity, and over the last four years, I successfully raised
13:35$130,000 in funding, and I'm asking you to join my team as we close the economic wealth
13:40gap.
13:43That was a great pitch.
13:44No, yes, there was a few things missing. In other words, I don't know.
13:47Revenue?
13:47Revenue, valuation.
13:49That's what she's going to come in here and tell us all about.
13:51I mean, it's a cold elevator pitch. We want to hear how much revenue you're making and
13:56what's the ask.
13:56Yeah, but sometimes it's a story, too. People really build their businesses also on a story.
14:02I understand that, but if you can't be compelling in an elevator pitch, you may
14:06not even get the chance to tell your story, and that might be the case here, actually.
14:10Guys ready?
14:11Ready.
14:21Attention, Shantia. Your pitch has been
14:30approved.
14:31What?
14:33Shantia, that's what I'm talking about.
14:36Shantia, welcome to the boardroom. Congratulations.
14:39Thank you so much.
14:39There was a couple things missing, particularly the ask. What are you looking for? Is there
14:44a valuation? Tell me a little bit about that.
14:46Absolutely. Right now, I am looking for $100,000 with a 7% equity. Safe note will be ideal,
14:53but open to any available opportunities.
14:56And have you raised money before?
14:58So, actually, yes. I have angel investors right now. I've secured over $130,000, but
15:03I have a $50,000 convertible note. The rest is non-dilutive funding that I want to pitch
15:08competitions and grants.
15:09Tell us more about your story. Why you? Why now? And how are you going to make this an
15:15incredible investment opportunity for all of us?
15:17So, I would phrase it as, why not now? We've never had AI, and we've never been in a time
15:23where we can close the economic wealth gap with technology. Why me? It's because I've
15:28been a top performer from student athlete to I work in college admissions. I'm a top
15:33performer, and so I'll do the same thing as an entrepreneur. So, you're truly investing
15:37in my resilience, and it's personal to me. I'm a first-generation college student. No
15:41one in my family saw success until I took that leap. And plus, my mom, she passed away
15:46before she could get her GED, so it's personal to me.
15:50So, sorry to hear about your mother.
15:53My question is, there are a zillion AI companies that are essentially out there. It's the
15:58buzzword. So, what exactly about your AI makes it so unique?
16:02With predictive analytics, we can just train it to think as an admissions advisor. Students
16:07just, they never know what they're good at, and so with my AI, we'll show them based on
16:13their strengths, hey, if you rank high in math, you should be looking at these programs.
16:17A lot of students are pursuing degrees based on parents telling them what they should do,
16:21but they don't truly know what their true gift is, and I think that's where we're
16:25different.
16:25Shantia, who is the customer? Is this sold to the student or to the high school admissions
16:30office? High school admissions counselors or to the parents?
16:33Yeah. So, actually, in our pilot, the customers will be the principals and the guidance counselors.
16:37I'm just getting a rough idea whether this is a $1,000 a year product or a $10,000 or
16:42$100,000.
16:42Okay. Right now, we are going to pilot at $25,000 per year.
16:46Per school or per district?
16:47Per school.
16:48$25,000 per year.
16:49That is correct.
16:50And so you're piloting in one school?
16:52Yes.
16:52How do you get scale to 10,000 schools?
16:55Well, to be honest with you, through our strategic partners, they have 100,000 students in Central
16:59Florida. They are already in 10 schools, and I'm already in one of those schools. They've
17:04already asked us to expand to three other schools in August. That's why I'm here. If
17:09I had the access to capital and I had the team, we could execute it.
17:12What does this actually do? Does it tell you which college to apply to?
17:17That is correct.
17:17Does it tell you how to complete the Common App better?
17:20So let's say you came in and you was like, okay, I want to sign up. You would put in
17:24all your information. So I'm in Florida. I'll use myself. I was in Florida, 3.5 GPA. I'm
17:31looking for a public school because obviously if I go to a public school and I get bright
17:34futures, I have a potential to have it paid for. So you put in all your information, and
17:39then the system right now searches the database. The entire 4,500 colleges in the U.S., based
17:45on your information that you put, these are the top 10 colleges.
17:49And so you're looking today for an investment. What are you looking for in an investor?
17:55Well, I definitely need an investor who can help make some quick moves because I like
17:59to move fast. So probably strategic partnerships, helping us with AI. I know there's going to
18:06be a lot of data policies, especially around education, and potentially the government
18:12will put some restrictions. So helping us just stay ahead of those curves.
18:16What's the experience for someone who does not have access to this tool?
18:20Oh, that is a great question. So it could be whatever resources they have. It could be
18:25a guidance counselor. It could be, I have no clue. It could be Google.
18:28What's the competition like? It seems like there has to be other apps or other technology that
18:34is able to give consolidated information for students looking for college education.
18:39There are tools out there, but there is nothing that is streamlined for your personal experience
18:45is what we're different. Every student is not the same. Every student outcome is different,
18:49especially because we come from different socioeconomic backgrounds. So our experience
18:52would not be the same. You're right. Maybe the most wealthy schools can afford this.
18:58Boy, I want to hear the you're right part. Yeah, you're right. I'm out.
19:02You're trying to prevent her from getting some good data here?
19:04You know what? I think I love your tenacity. I love your story. I love where you're going.
19:08But I think you need support and mentorship more than you need money at this point,
19:11because that's going to help you get to all of that scale.
19:15Okay. I appreciate your feedback.
19:19Kim, Kim, Kim. The thing is Kim's absolutely right is you need a bunch of help and support,
19:26and I can see the ways that you can make this work. But I also know a lot about ed tech,
19:31specifically how unbelievably hard it is because you've picked the worst possible type of customer.
19:38I mean, selling to schools is brutal. Selling to school districts is even harder.
19:44Mark, Mark, you're being you're being a little a little harsh.
19:48First generation student has built an amazing platform. She's on her first school. I think
19:54the thing that you said before, Kim, is she needs mentorship. That's part of our responsibility,
19:59I think, is as investors to be able to provide that mentorship and then also provide that capital,
20:04There's a perfect lead in for you, Don.
20:08I know a lot of people in the education world. I know a lot of education tools that are out there.
20:12I know a lot of schools. I know a lot of colleges. So I'm sitting here wrestling with,
20:16is this company the readiest app? Is it ready for an investment?
20:21Well, we already have an investment. So I would have to say yes.
20:24We just want to scale it beyond and take it to the next level.
20:28So Shantia, I love what you're doing. And this is not something I'm going to make
20:33millions of dollars on, so I'm not prepared to do the whole round.
20:37But I'll tell you what, I would love to help. And so I'll put in something.
20:42I'll do $25,000 and let's say for 2% of the company.
20:47Okay. I love that.
20:48I'll give you $50,000 for 5%.
20:55All right. You have two great offers, $25,000 for 2% of the company or $50,000 for 5% of the company.
21:03Let's see.
21:08This is a great opportunity for EdTech Experience.
21:15I feel like the honey has way more connections, so I would love to go with that.
21:18That's what I'm talking about. That is what I'm talking about.
21:21Love that. Way more connections.
21:24That's amazing.
21:25You see that? Get over here. Come on.
21:28Congratulations.
21:29Thank you so much. Oh, give me this.
21:31Yes.
21:32Alas, we have both graduated. Thank you so much.
21:36I am so grateful. I actually got my dream investor. That's exactly who I wanted.
21:41He has a ton of experience and knowledge with the EdTech space,
21:45so he can really help us get ahead of challenges.
21:49Honestly, at the end of the day, it only takes one person to make a huge difference.
21:53And I think having you as a mentor and investor is going to be a game changer.
22:01Many entrepreneurs bravely stepped into the elevator today,
22:06but just two made it into the boardroom,
22:09and only one was able to secure a high-flying deal with our investors.
22:15In the high-stakes world of business, if you want to achieve your dreams,
22:20you must rise to the occasion to get to the top.
22:25What?
22:27Tune in next week as Entrepreneur Elevator Pitch continues.
22:33Wow, he can breathe now.
22:34It was excellent pitch.
22:36That is going to be a fun one to watch.
22:39And to apply for the next season, go to entrepreneur.com slash elevator pitch.