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

Daniel Bilbao (founding engineer and board member at Fubon, now Frubana) introduces the idea of 'killing the deal' during sales to test genuine interest. He highlights Frubana's successful journey, which involved deliberate market entry and a focus on understanding customer needs. Frubana connects farms with restaurants, addressing inefficiencies in the supply chain. Daniel explains how his brother helped the founder, Funsho, launch the company, even before Funsho left his previous role at Rappi. Frubana has since grown to near unicorn status, with impressive valuations and a strong investor base.

Daniel shares that Frubana's success wasn't due to one 'hockey stick' moment but rather a combination of many small, effective strategies. Early on, they offered free first deliveries to restaurants to encourage product trials. Funsho's previous experience launching markets for Rappi gave him a significant advantage. A crucial insight was Funsho's ability to build a strong founding team with significant equity, emphasizing that hiring top talent is the highest leverage activity for company growth.

Daniel discusses his current company, Aurora, which connects businesses and users through various channels, starting with WhatsApp. Aurora started as a background check company, evolved into KYC, and then pivoted to be WhatsApp-first, enabling transactions like buying stocks via WhatsApp without requiring an app download. Aurora, four years old, is nearing $8 million in ARR, operates in seven countries, and maintains a strong financial position, prioritizing fundamentals over valuation.

Daniel emphasizes that in the early stages of B2B SaaS, founders must lead sales themselves. He personally drove Aurora's initial sales, targeting a list of 200 large companies with a highly tailored approach, including warm introductions and thorough research on prospects. He warns against simply blasting emails for large B2B sales, advocating for building trust and personal connections. Aurora also built 'ZapSign', a DocuSign-like product optimized for WhatsApp, which saw significant growth in Latin America by leveraging the platform widely used by small businesses.

Daniel acknowledges the challenge of receiving false positive feedback from warm intros. His solution is to charge for the product upfront, ensuring customers are genuinely invested. He recommends reading 'The Mom Test' to navigate biases in customer discovery. He also shares a tactic: tell potential clients you’re building for a limited number of customers and ask if they want to be one of them. For large deals, he advises 'trying to kill the deal' by presenting reasons why it shouldn't happen; if the prospect remains interested, it's a strong indicator of a serious deal.

Daniel shares crucial fundraising advice: founders should not learn fundraising by engaging directly with funds. Instead, preparation is key, including extensive conversations with other founders and angels. He cautions against going to VCs prematurely, as 'green' founders are often rejected, only to succeed later when more polished. He advises against learning on the fly during actual fundraising rounds. He illustrates the low probability of securing investment even after a positive meeting with a VC, emphasizing that multiple simultaneous committee discussions are often needed to secure a term sheet.

Daniel highlights the importance of understanding the incentives and dynamics of venture capitalists. Founders need to research fund sizes, investment cycles, valuation perspectives, and VC biases. He emphasizes approaching VCs not as ATMs but as individuals with their own incentives and career objectives. By understanding what VCs need, founders can better align their pitch and create mutual benefit. He equates VCs to founders of a different kind of company, where their 'product' is the startups they invest in for their LPs.