 Hello, everyone. So I'm here to talk about raising capital, raising funds for a WordPress business specifically. I'll share a little bit about myself. My name is Chris Lubker, as Emma mentioned. I live in Denver, Colorado in the USA, go skiing and biking and things like that. And I conveniently wore the same shirt as is in my photo, so you know it's really me. And I'm the co-founder of Extendify, which is a software solution that helps hosts around the world to improve their WordPress experience. And at Extendify, we've raised capital for our business a few different times now over the past little while. And so I have that experience, you know, kind of being on the founder side of it, raising funds. Also previously I was at Automatic, which is the company behind WordPress.com and commerce, et cetera. And at Automatic, I managed various acquisitions and also investments that we made on behalf of the company. So I've kind of been on both sides of the table, both in and outside of WordPress, because previous to Automatic, I was at another software company, we raised $25 million of growth capital at some point and supported that and was also in private equity way back early in my career as well. So I feel like raising capital is oftentimes this mysterious process, this mysterious concept. So I wanted to just shed some light on what it is, what it entails, and give some framework for thinking about whether or not it's right for your business. So that's what we'll talk about today. We'll talk about what is raising capital, should you raise capital, because the short answer is no, not for everyone. So it's an important question to consider for yourself. And then if it does make sense, we'll talk about how to go about doing that and the steps that you should take. So what is raising capital? And capital is kind of a fancy word for money, essentially. It's just money, right? No matter how you get it, getting capital for your business is just about raising money. You can do that. I'll go through a couple of different ways that that can happen, just as we can think about the different options that exist and then talk about before we talk about should you do it or not. But capital, if you need funds for your business, you can do that in two basic ways. It can be debt, which is capital that you pay back. You can get it from a bank. You can get it from an individual. They can give you a loan. You pay it back with interest. That's one way you can raise capital. The second way is as equity, and then do this in exchange for an ownership stake in your business. And that's where we'll really focus today. I'll spend most of my time talking about equity, because oftentimes when people talk about raising capital, they're talking about equity capital specifically, so bringing on an investor in their business in exchange for giving away a portion of the ownership of their business. So we'll focus on that today, but I think it is important to be aware that depending on your needs, you could also consider debt as well through a variety of different ways. And then another concept which people often talk about is majority versus minority. And this is a fairly straightforward concept, but essentially if you're selling, if someone's investing a majority stake, that means they own more than half of the business. And so for all the math majors out there, that means you own less than half of the business. And if it's a minority stake, then that means the investor owns less than half of the business. It could be 49%, it could be 1%, it could be anything in between, or even less, I guess, in theory. And so in a minority stake, that means you still own the majority of the business. In theory, you could get multiple minority investments and you could end up with less than half yourself. But traditionally, that means that you still own the business, you still have at least some portion, some version of control of the business and what happens. But somebody else has ownership in it. And so a majority investment can oftentimes feel more like closer to an acquisition than an investment because somebody else owns the business, they own control over the business. You still have some ownership in the business and so you can still share in the upside. So as it continues to succeed and grow, that will, you could reap the benefits of that. So it's not exactly like a full acquisition, but we'll focus today more on the minority investment because that's often as people refer to when they talk about this. And the last, we're going through some terminology here, but I think it's important, the words aren't necessarily important, but the concepts are important to think about when it comes to raising capital. But there's this concept of primary versus secondary capital. And what that means essentially is primary is when the business gets the money. And so if you raised $100 in exchange for some portion of equity, that $100, if it's primary capital, goes into business bank account, it's used to for the business in some way or another. In theory, it should be used to help increase the value of that business. But it doesn't go to your personal bank account. It's not you selling your own equity, your own shares in the business. And secondary capital is when you would sell or anyone would sell shares that they already own. And this is a little bit less common, I would say, secondary capital. Often as people are talking about raising capital, it's because they want funds to do something for their business, which would be primary capital essentially, using the money to help increase the value of the business. But sometimes there are people who will decide that they want to maintain some ownership of their business, but they want some sort of proceeds to go do something with some funds or de-risk their future or something like that. So there are sometimes opportunities, typically secondary capital is more for established businesses, ones that don't need the money, but the owner is just looking to or some shareholder is looking to sell a portion of their stake. So I think generally when I talk about raising capital, I'll talk about primary capital. I won't specify it, but typically it's about using funds for your business to help you grow, help you achieve certain goals that you're looking to do. And you can raise capital from a variety of different places. The three most common ones that we think about are angel investors, which are individuals. These are either individuals on their own or as part of a small collective of people who choose to invest in a particular company. There are investment firms as well. So these can be anything from like some of the traditional venture capital funds out of Silicon Valley and all around the world, you know, like that have, you know, teams of people that manage other people's money, make lots of different investments, or the last one to think about our strategic investors as well. And so think about my role at automatic when we would make an investment, that would be considered a strategic investor. It's another company investing in a business. And I would think from my perspective, I think automatic is the most active in our space. There are a few others in the WordPress space, but there are also others outside of WordPress that could be relevant depending on your business. So companies like Stripe or PayPal have made strategic investments in other companies. And so, you know, these are three different categories of companies that you can pursue or when thinking about raising capital, who could be potential investors. And at Extendify, we've essentially raised capital from all three kind of a blend of all of these. So I kind of have experience and think about each of these different groups. So there's a big question about like, should you raise capital for your business? And I think that was the, that was the kind of when I thought about this topic, it was, it was a question that I feel like I'm asked quite often, given my background and experience, a lot of times people come and say, you know, I'm thinking about raising capital, how should I think about that decision? Should I do it or not? You know, there's kind of this very basic question at the beginning. And it's important to think about, because it's not the answer to every problem. It's not right for every business. It's, you know, it comes with, you know, what for some business could be very important benefits, but it's also comes with some implications that you need to be aware of and make sure is the right fit for what you're trying to do. So I'll talk first about like what bringing out investors can help you buy, help you do. You know, there are three different things that can, you know, obviously there's the capital part of it, where you're given funds. And so you can use that funds to do different things. Investors can also give you guidance or hold you accountable if that's something you need as well. And they can also bring credibility to you, your business and help you in various ways there. So let's, I'll dig in a little bit deeper on each of these. So the, what can you use the money for essentially? This is like going to be one of the first questions that any investor, if you are seeking to raise capital, will ask you. It's like, well, why are you asking for this money? What are you going to go do with it? How is it going to help your business to grow? And so there are three broad buckets that you could do that you could use capital for. One is to invest in product. Maybe there's a new product that you want to go build. There's something that you've kind of have a prototype for and want to invest in growing it out. You can invest it in R and D, essentially a product development. The second broad category is growth. When I say growth, I really mean, and what I'm really talking about is marketing or sales or initiatives there that you could do to gain more customers and grow, help to grow the business that way. And this is something, both of these are ones where it could be very helpful to have some initial proof points, I would say, right? So just going and trying to raise capital for a product you've have started zero development on or zero research on can be quite challenging. Same with growth. I think a lot of times companies think, well, if only I had a salesperson or only, if only I had a marketer, then everything would be great, right? Then my business would continue to grow. And it can be quite challenging if you've never even experimented with some of these initiatives to get people to believe that it's going to work out, right? So even if you feel like you need capital to invest in growth and marketing or salesperson or something like that, then doing a few steps early on to demonstrate that there will be some success with that can be very, very helpful. And the last thing is, the last broad category is M&A, which is mergers and acquisitions. So you could decide you wanted to use capital to acquire another business. And I think it's something a lot of times people don't think about. They don't think that it's a possibility for them. They don't think that they're big enough to acquire another business or they don't have the funds to do it. And M&A is a whole separate talk and a whole other topic to really think through how to do that well and how to make sure that it's good for the business. But it is something that many times you can raise capital to do, whether it's debt or equity. And so even if your business is profitable, it's growing, you feel like you don't need funds, it could be a reason at some point in the future if you did decide to pursue some sort of acquisition that was going to be strategic and important for your business and really helpful. You could use capital for that as well. And the right investors can be very, very helpful actually. So I think we've found this with Extendify. We are a WordPress business, obviously we're kind of based on WordPress. So we've brought some people with deep experience in the WordPress ecosystem, like Yoast and Marieke from Emilia Capital with their booth right outside. They obviously have invested in Extendify. They obviously have a tremendous amount of experience growing one of the largest product companies in the space and they've got a guidance and support has been very helpful. We also sell, for us, we sell into the hosting market and we brought on some investors who have both expertise and connections in that space as well and has been very helpful for us. So as I think about Extendify, we have obviously the capital, the money has been important in itself, but probably even more impactful has been bringing the right types of investors that have been really helpful for our business. And I don't think we'd be where we are today without a lot of their support. And then the last piece that I mentioned before is credibility. And I think this has been an impact for us at Extendify as well. I mentioned selling to the hosting market, like many of the, you know, aside from the 10 hosts that come to work camps, like many of them aren't very deep into the WordPress ecosystem in the community. And so we're unknown to us. Like we didn't know them. They didn't know us. And so our first conversations with people, you know, having some stamp of approval, if you will, you know, by the credibility that it comes with other people saying that they are willing to put money behind your business, behind your idea, behind what you're doing has been helpful as well. You know, it just kind of like gives people an opportunity to, you know, kind of puts people in a positive predisposition to talk to you. So should you raise capital? I think there are a few questions you should ask yourself in order to really think through whether or not it's right for your business or not. It's like, one is do you need the money? Right? If you don't need the money, then maybe you could get advisors. You could try to solve some of your, solve for some of your kind of gaps that you're looking to fill around credibility or support in other ways. So if you don't need, I think this is like a very important question to think about. Like I mentioned this earlier, what would you go do with those funds as well? Right? Like what's your plan? And it's not enough just to say, Oh, marketing, I would like to invest in marketing. So let me raise some money for that. I think going a level deeper and really thinking about what is it going to do for your business? How is it going to make it more valuable? Because there is a real trade off, right? You're giving away a portion of the ownership of your business to someone else. And so that funding, that transaction should make the whole thing more valuable than what you would do just on your own. And it can have that effect, right? Obviously, owning, if you own 80% of a business that's three times as large as it would have been otherwise, that's, that's really better than owning from a financial standpoint, at least they're owning 100% of the smaller business. But so the second is, do you need the support? And I think this also goes into what types of investors you would look for as well. But is it, you know, are there people that you could bring on board that would be helpful to your business that would fill in kind of gaps in your own knowledge or experience in somewhere or another that you could that could be valuable. This next one, the third question is about what type of business you really want to run? And this is, this is more of like a looking deep inside yourself as opposed to looking at your business and, you know, kind of more objective. It's more like soul searching, really, you know, like, are you interested in having a business that supports your lifestyle, that you run for the next 20 years, that allows you to work on interesting things and you're just perfectly content with the path that you're on. In that case, you probably shouldn't raise capital, right? Because, you know, the investors are gonna whatever investor you bring on is likely to have a different expectation for that business and what you're going to do. Or are you interested in continuing to grow? And for some people, if you're a single individual, that might mean now managing a team and going from being a product owner, developer, working on building out the product to now spending most of your time managing a team. Like, is that something you really want to do? Does that get you excited? Is that something that, you know, will fulfill you, essentially? So, kind of thinking about the type of business you are, you're looking after, it will both make sure that raising capital is the right decision for you and it will also help you to find the right types of investors as well that kind of match what you're trying to do. And then the last question I think is important to ask yourself is, are you ready for the responsibility? Because it is a responsibility. There's a lot of trust that goes into somebody giving you, you know, whether it's a small or a large amount of money, it doesn't really matter. You are now a custodian, essentially, of their investment, right? Your responsibility is not just to the business you had previously, but you have a responsibility to deliver on what you said you were gonna do and take care of the investment that someone's chosen to make in you and deliver on that trust, right? They're believing in you that you and the team that you have are able to build something great, deliver on what you set out to do. So, these are questions to really think about and ask yourself around whether or not you should raise capital. We talked about some of the benefits, you know, but I think there are also, it's absolutely not the right decision for every person out there. And it's important to really think about if it's right for you, and now is the right time for you as well. So, assuming you do think it makes sense, we'll talk briefly here about how to raise capital. I think this is something that's also like a mysterious process, right? You, most of what you hear about are, you know, some sort of announcement that says, hey, we've raised some capital and you don't understand all of the effort that goes into and all the work steps that have gone into, you know, kind of getting to that point. And it's interesting, I feel like this is on people's minds a lot more now in the WordPress ecosystem because over the past two, three years, there's been an increase in investment opportunities. So, now it's like a real possibility for many people. Previously, you know, kind of in the first 15, 16, 17 years of WordPress's history, it was mainly just a few hosting providers that were kind of had to external capital. Almost every other business was, you know, one that was bootstrapped and grown and kind of grown over time. And many have been quite successful. And so that was the tried and true model in WordPress. And I think it's still as possible today to grow a successful business using that model. But now, more than ever, I think there's an opportunity, if it's right for your business, to decide to raise capital. And so there are a few key steps I'll talk about here. The first one is to identify the right type of investor. And I talked a little bit about this. I touched a little bit about this earlier, but we talked about angel investors, you know, investment funds, strategic investors. So there are types in kind of that way, like who they are and which one is going to be, or multiple ones, is going to be most helpful for your business, is going to help you achieve whatever goals you have. But there's also an important thing to think about, like, both what stage you're in, and by stage, I mean, where your company is, are you just getting started? Do you have a profitable growing business today? Do you have a multi-million dollar business that just needs some other type of funding? So thinking about the right stage is important, because if you are just starting out, you've been in business for a year, you have a product, you have a handful of customers, but you're looking to get beyond this very early stage. If you go reach out to people who are companies who focus more on later stage growth capital, they're investing tens of millions of dollars in businesses that already have meaningful revenue, lots of history, you could talk to 100 of them and none of them is going to be a fit, right? They're not going to be the right fit for where you are in your stage of business. And kind of equally important to stage is thinking about what your ambitions are, because there are some companies, traditional kind of Silicon Valley investment venture capital funds, who all they care about are can you be a billion dollar, multi-billion dollar company? They would rather have a 2% chance that you turn out to be this unicorn, and a 98% chance that it completely fails than have something that's a less risky bet, but with less upside. So this kind of goes back to the soul searching part of it a little bit, but what type of business, what are you striving for? What are your goals and ambitions? Will also help you align with the right types of investors as well, because there are plenty of investors out there who would be excited about making kind of five times return on their money, meaning if they invest $100, they get $500 back. That would be a good outcome for them, and they hope that every one of their investments succeeds and returns some sort of capital. But if you go talk to Andreessen Horowitz or Sequoia Capital or some of these traditional venture capital funds, they'll be completely non-interested in a business like that. So really thinking about where you want to take the business will help you to find the right types of investors to their ambition from an investment standpoint is aligned with what you're trying to do. And then you have to build a pitch. And this isn't, I think there's an exercise around building a slide deck, and that's not specifically what I'm talking about here. I mean, what's your story? Why do you, what has brought you to where you are today? What is, where do you hope to achieve your business? What success have you had so far? We talked about those proof points, whether it's marketing or other uses of the capital. But like, how have you, what success have you been able to demonstrate today, and where do you want to take the business? And why is it a big opportunity? Why is it an opportunity that somebody should be excited about investing now? And I think equally important to this is is the person behind it, right? You, your team, the people behind it, I should say, because that is, when you talk to, when I've talked to like various investors, it is almost always the number one criteria. It's the person, right? They want to see a big opportunity. They want to see some traction. But without a doubt, they have to believe that you and the team are able to kind of actually achieve and execute on this business. Yeah, I was talking to someone just the other day who was talking about, hey, I really think this is a good opportunity, but I'm not actually sure if this team is the right team to go after it, to be successful. And so you are selling yourself just as much as you are selling your business and the opportunity in the market you're going after. And lastly, it's about making connections. So it's, I think people, you hear this a lot, that it's largely about, you know, there's always an important element of, you know, kind of making connections and networking, but getting out there, talking to people, finding introductions, meeting different people, telling your story. This is why it's important to have that pitch. That's why I put pitch as the number two before the connections, is really thinking through what that story is, can help you to tell that story, find new people who within that resonates and you have to make those connections. Because again, it comes back to, I mentioned trust before, people have to trust that you're going to be a good custodian of their investment and they have to believe in you as a person and you as a collective team as well in your ability to succeed. So I listed as three of these steps. It's not easy and it's not quick, right? This is a, it's another important consideration thinking about whether you should raise capital is the time and distraction it takes. It can take months and months and literally hundreds of conversations for different businesses. So there is a lot to it, but at a very high level, these are the steps that I would recommend taking if it is a path you choose to explore. So with that, I will be happy to take any questions, whether they're broad questions or specific to someone's experience. So yeah, thanks for having me. Thank you so much, Chris. So yeah, like you said, there is opportunity for some Q&A. So there are two microphones on both aisles. So if you have any questions, please head over to it. Oh, if there's a hand up. Yeah, yeah, if you can, please. Yes, I will hide over here. It's a bit, asking a question is a bit of a show itself. Anyway, you're referred to the kind of person or business that could go to a level that is a multi-billion one. Yes. Are there some basic traits? And either the company or the person that runs or the team that runs the company have to, you know, abide to in order to achieve that level of, are there some basic traits? I'm not talking, of course. Yeah, I would say it's a good question because most companies never reach anywhere close to that, right? That's why they're called unicorns. They're kind of, these are companies that have been massively successful and, you know, kind of exceed 99.9% of all their outcomes out there. So I think it's, there's a whole industry of venture capital around trying to identify these companies and look for those traits. Like you said, I think from a company standpoint, the number one thing, as you think about the, how big the company can go is how big the market is. So how big the opportunity is. And we're fortunate in WordPress in this broad ecosystem because WordPress powers, you know, 40-some odd percent of the web, depending on what you look at. You know, it's a huge opportunity. There's a huge market there, but you need to think about your specific opportunity and what that looks like. If today, you know, the entire market is only $500 million, then obviously it's really hard for you to grow meaningfully beyond that unless you're kind of creating a whole new category and evangelizing some things. So the first thing that people will look at when thinking about like the opportunity and the chances of becoming this multi-billion dollar company is the market. And this may be one kind of clarification on that is it could be, you know, you could get there in different steps, right? You could have initial product and offering that is maybe, you know, kind of at one level, but then you could have a path to potentially expanding that offering to then go after an even larger market. So besides the market is the, is, is one of the elements. And then when it comes to the person, it's the ambition, to go away, frankly, it's not for everyone. That's not what everyone likes to do. It might be easy to sit here and think of, could snap my fingers and have a billion dollar company. Of course, who wouldn't, you know, maybe lots of people would say they want that, but the work it's going to take and the risk that's involved with kind of striving for that level, I think, is it comes down to kind of the ambition of what that person is looking to do. And so I think reflecting yourself and trying to think about if that's what, if that's the life you want to have for yourself, not the outcome, but all the work it takes to get there would be the second thing I think about. Thank you very much. Yeah. Thank you. I think we've got a few more over there. Yeah. Hi, I'm Tom. Would you say that Europeans are much more modest in their ambitions? And I'm asking that because, you know, back in the day, we raised a seed round of, you know, 100k or so. And then I would read on TechCrunch that our American counterparts would raise like a 2.5 mil pre seed round, right? So there's some kind of disconnector and difference in, I don't know, our raising culture or our expectations. So what's your comment on that? Yeah, I think traditionally that's been true. Historically, there's been a difference between, you know, kind of geographies. It's been a combination of maybe the pitch or the story, you know, kind of the ambition part of it. It's also access to capital, right? So there was a lot more funds coming into some of the large investment areas within the United States, with just more money available, essentially, so people were willing to make bigger investments. And you talk about the difference between geography, I think the same has also been true thing about WordPress, actually, right? Like what is often has been a large round for a WordPress company would be considered a very tiny one for a software company out in the non WordPress ecosystem. And I don't actually necessarily think that's a bad thing, right? I don't think that the size of the round is something that, you know, is a bragging point, you know, right? It's what you do with it and what you're actually able to go achieve. And so in many ways, you could say raising a smaller amount of capital and still succeeding is better, better for you, the investors, etc. So I don't know that like one's necessarily better together, but there has been that difference. I think at a very anecdotal level, I think it's changing as, you know, more investors are willing to make investments outside of specific geographic regions. So many U.S. investors are able to make investments outside of the United States these days. So I think that's changing a little bit. But I also don't think it's like the primary metric, right? If you can raise $100,000, then that can fuel your next stage of growth and set you up for success. Then you should you should do that, right? You shouldn't raise two and a half million dollars if you don't need it. So yeah. Hello. Thank you for presentation. Really good. I have question like I'm really like have zero information about, you know, investors and this stuff. The question is, could you please share some tips places where to find U.S. investors for the European company? Yeah. So the first thing you can do, this is an U.S. investor, but you can go to the Emilia Capital booth. I hear by the way they're giving out 10-year-old notes as swag, so definitely need to go check it out. It's just a rumor, so don't don't find me if that's untrue. But I think it is always a challenge if you're reaching out to people cold, right? With no introduction, they don't know you're sending an email. It may be, you know, sometimes it works out. Sometimes you can send the perfect email. Someone happens to read it. They choose to talk to you and it works out magically. But it's very, very hard to make that work, really, you know? So the best way is to try to make connections to get there. And you may not have deep connections to U.S. investors or any investors maybe, right? So that's where it comes down to like telling your story and making any connection, right? Like meeting people at a work camp who then may be excited about what you're doing and maybe they're not an investor, but maybe they know someone who would also maybe be excited about what you're doing, kind of, even if it takes multiple chains, multiple kind of links, steps to get there. That's by far the most effective way. I can't think of a single investor that we've brought on at Stendify or even in my kind of past experience where we didn't have some sort of connection. So yeah, I mean, it's not the, I know it's certainly a challenge. It's not easy to do that. But sometimes all it takes is finding one person, you know, who's excited about what you're doing, who can then connect you to one other person. So, and I would say we've had my co-founder, Arthur and I, like, probably hundreds in the hundreds of conversations, not with specific investors, but telling our story, right? And so the majority of them don't work out. They don't turn into anything. And so I wouldn't get discouraged thinking, oh, I found this person, but then they never ended up connecting me to someone. So you just have to kind of keep putting in that effort to networking and making those connections and telling your story. Thanks. Yeah, good luck. Thank you for all the information. I wanted to ask if there is some good way to estimate, for example, if there is an investor for your company, if it's an angel investor, let's say, how much percentage would you think it's a good one to give to the investor or the strategic investor, or how do you estimate how much is fair enough? That's a very, very good question. And with every good question, it comes with a standard answer of, like, it depends, right? So it's not, there's not like a generic, there's not a, but it's something that is, the reason it's a question, it's a very good question, is because oftentimes it's not, this information isn't very public, right? People talk about the, maybe they raised some capital, but the details of it aren't shared publicly. So you don't have this, you know, kind of these examples of what's common, what makes sense for different types of businesses. But the two things that it really depends on is, one, how much capital you're kind of bringing in, and two, like how kind of the belief of how valuable the business is, right? Both today and where it can go in the future, because the very simple equation is, if someone puts in $100,000 and they believe the business is worth a million dollars, then they should own 10% of that business, right? You kind of think about it as that basic math there. So in some ways, the value is how good you can sell it, right? And maybe even how much interest there is, right? So if you have multiple different options, that's always better than kind of having one person or fund or firm or anything that you go after. I would say broadly though, to give you a sense, like kind of for an early stage, like a first investor, you probably could expect, whether it's an individual or a collect group of different investors anywhere from like five to maybe upwards of like 30, 25, 30%. 25, 30 would probably be pretty high. Five would probably be on the lower side of things. So something in that range would be a common amount. But again, it all comes down to like how well you can sell yourself and your company kind of essentially, right? Thank you. Thank you for your thoughts. Yeah. One more. Yeah, just one more. Okay. Sorry. If you had a million dollars and you had to invest that in WordPress, where would you? I would invest in Extendify. But assuming that that wasn't what you were wondering about. I mean, it is that is the opportunity that I'm excited about the most, right, is kind of helping the experience, especially the initial experience and the ongoing experience with WordPress. I think I would invest it in a company that has a clear distribution strategy, right? So it goes beyond just having a good product, but is there some unique way to get distribution and kind of growth for the business? So today I'm quite like with a path we're taking is selling in kind of going through the hosting channel, which I think is interesting and under tapped today. So if there are, I think there are a handful of solutions in both the security space, performance space that are also doing that and have found good success. So I think it would be a company like that, patch stack, object cash, pro. These are some companies that have kind of taken that approach. And I think have a bright future. So thanks. Yeah. All right. Thank you very much.