Sit Down Startup Podcast l Frubana’s Founding Engineer, Daniel Bilbao; GTM tactics for $0 - $1M

Daniel Bilbao introduces the idea of trying to 'kill' a potential deal by presenting all the reasons why it shouldn't happen. If the prospect remains interested, it significantly increases the likelihood of success, contrasting with the common approach of trying to avoid a 'no' which can lead to wasted time and effort.

The host, Adam O'Donnell, introduces Daniel Bilbao, founding engineer and board member at Fubon, a company that has raised $271 million. Daniel shares the origin story of Frubana, detailing how his brother impulsively became a co-founder and how they assembled an early team to build the platform while the main founder was still working at Rappi. Frubana connects farms directly to restaurants, tackling inefficiencies in the supply chain. He mentions their valuation is near unicorn status with a strong cap table.

Daniel explains that Frubana's growth wasn't a single 'hockey stick' moment but rather a combination of many small experiments, unlike typical SaaS businesses. An early tactic was offering the first delivery for free to restaurants, which led to a high conversion rate. He emphasizes the importance of building a strong founding team (junior founders) with significant equity, highlighting that hiring the best people is the highest leverage activity for growth, citing his extensive experience with over 12 companies in Latin America.

Daniel transitions to his current company, Aurora, which helps companies connect with users through various channels, primarily WhatsApp. Aurora started as a background checks company, then evolved into KYC services, and finally shifted to a WhatsApp-first approach to cater to emerging markets. He proudly states Aurora's current Annual Recurring Revenue (ARR) is close to $8 million in four years and highlights their financial stability in the current market, emphasizing a focus on fundamentals over valuation.

Daniel elaborates on Aurora's early sales strategy, where he personally handled most of the sales to achieve the first $2 million in ARR. He advises founders to sell their own products first, rather than immediately hiring a VP of sales. He details a targeted approach to B2B enterprise sales, focusing on a known universe of 200 companies, meticulous research to get warm introductions, and leveraging credibility. He also introduces 'The Mom Test' concept, recommending charging for products upfront to get honest feedback and avoid false positives, comparing solutions to 'medicine' versus 'vitamins', and offers tactics like creating artificial scarcity for early adopters.

Daniel shares critical advice on fundraising, stressing that founders should not learn fundraising while actively seeking capital. He compares it to learning poker in a professional tournament. Instead, he advocates for extensive preparation, practicing with founders and angels, and not approaching VCs until fully ready. He provides a stark statistic: the probability of an investment committee approving an investment, even with strong interest, is about 1 in 10, surprising many founders who overestimate their chances.

Building on fundraising advice, Daniel emphasizes the importance of understanding the incentives and dynamics of venture capitalists. He advises founders to research the VC fund's size, stage, and what constitutes a 'good year' for them. He highlights that VCs are essentially founders of their own companies, with their 'product' being the startups they invest in, which they present to LPs. Understanding this perspective and aligning incentives leads to more effective conversations and a higher likelihood of success in fundraising.