'Founders Who Fundraise' is a new blog series highlighting founders in the Bowery portfolio and their origin stories. Have you ever wondered how founders come up with their ideas, how they approach testing and validating, as well as their approach to fundraising? This series will share stories from the founder’s POV and provide insight on the inner workings of starting a VC backed business.
Valentina is the co-founder & CEO of AllSpice, a SaaS platform that modernizes the way engineers develop hardware. Together with her co-founder & CTO Kyle, they saw the need for better software tools in the hardware development industry and built AllSpice to fill that gap. In this interview, Valentina shares her insights on starting a company, raising funds, and testing market validation.
How did you come up with the idea for AllSpice?
Before starting graduate school, I worked on large infrastructure projects and discovered that building various facilities across different states was not scalable. The manual work of sending emails and making phone calls inspired me to get involved in building internal software tools. This experience piqued my interest in software tools for hardware development. I noticed that software engineers had an amazing software ecosystem and as a software engineer you could build your own tools. The upside of this for engineers is that not only did the speed and quality improve but it also increased employee satisfaction as people were happier and had the necessary tools to succeed. For hardware engineers, however, these types of enablement tools were lacking.
That's when I met Kyle in graduate school. He too empathized with this problem given his background in electrical engineering. He proposed utilizing the existing software workflow and applying it to hardware development, rather than reinventing the wheel. Our focus was on building bridges that these workflows needed to operate, rather than creating code for engineers.
Can you share how you approached the idea of starting AllSpice on your own versus having a co-founder and how did you decide on your roles and responsibilities?
Kyle and I met in grad school and were assigned to be partners in a project by our professor. Our work styles complemented each other, with Kyle being very creative and me being very practical. We had a shared theory that successful companies would need to build better hardware by aligning with software. We both saw that no hardware project could succeed without software, and thus software isolation was no more.
When we started AllSpice, we spent the first year re-scoping our roles and responsibilities until we figured out a good split as well as what works best for each of us. Kyle initially started out as CEO and I was COO. After our pre-seed fundraise, we decided to flip. I became CEO, focusing on fundraising, investor relations, sales, and marketing. Since Kyle was spending more time on the product, he moved into the CTO role. It was quite painless, which speaks to the respect we have for each other and the willingness to do what is best for the company. We had a mutual understanding that whoever was best suited for a particular role should take it.
What was your process for testing market validation before raising money?
Before raising our pre-seed round, we did a technical proof of concept. Once we knew it could be done, we built a free tool on our website that grew a community of test users. This allowed us to gather information through usage and conversations, which was critical in developing our ideal customer profiles and buyer personas. From all of these learnings, we created and launched the MVP of AllSpice before we raised our seed round in beta. We launched the free product, got a ton of test users, had a ton of customer conversations, scoped the beta, built the beta product, then we got the first few beta partners on the product and finally, we raised our seed round.
We had hundreds of engineers on our MVP, a free diff tool on our website. We spoke to many of them, which helped inform what our paid platform, AllSpice, would become. This allowed for a lot of customer conversations, so we scoped not just what was helpful about the product, but also what not to build. We were looking for what our first three features would be and what we could build later. We ruthlessly prioritized features, focused on the ones that got a lot of love, and deprioritized those that lacked reception.
What was your approach to fundraising?
For the pre-seed round, I didn't have a solid process and it dragged on for a couple of months. For the seed round, I learned from the pre-seed round and prepared everything - documents, information, analysis, etc. I started having conversations and got the first offer from Bowery before we even started to raise. After that, I had a week to wrap up conversations and get everyone on the same schedule. We were fundraising technically for a week because our first conversation with Loren was an intro from a pre-seed investor. Bowery was my ideal consortium of an investor. I was looking for hardware, Go-To-Market, and product expertise, which is why we ultimately chose Bowery.
Reflecting on your journey so far, what is something that has changed in your life since starting AllSpice, personally and professionally? Conclusion
Personally, I got a dog and moved to San Francisco after graduation to be where our customers are and to immerse myself in the user profile. I wanted to be close to the customers as a GTM builder. Professionally, I learned to understand what things mean in VC speak and to find investors that believe in the work and vision of the industry, rather than trying to convince investors to see this world from my perspective.
Conclusion
AllSpice is a prime example of how there can be simplicity in honing in on your value proposition. Valentina and Kyle's vision for the company has been validated through the success of their fundraising efforts and customer conversations. As AllSpice continues to grow, it will be exciting to see how they continue to innovate and re envision the future of the hardware development industry.
If you liked “Founders Who Fundraise - Valentina Ratner (AllSpice)” and want to read more content from the Bowery Capital Team, check out other relevant posts from the Bowery Capital Blog.
