We’re happy to have been selected as a final presenter at the 2012 Montgomery Technology Conference this week in Santa Monica, CA.
The conference is an invitation-only event featuring over 1,000 senior-level private equity and venture capital professionals. The financiers will be reviewing the best of breed new startup disruptors.
I’m not sure if there are other San Diego Startups presenting at the event, but I welcome meeting up with you there if you’re going!
In my presentation, I’m going to speak about what we’ve been working on the past five years, our traction, and where we see the market going in the future. The truth is that buying services on the web is still really difficult to do. But we believe that over the next few years, there will be companies (like us) that make buying services on the web as easy as buying products. When that happens, there will be a whole new wave of ecommerce that allows a safer and easier experience for the customer.
Personally, I’m excited about the conference because I’ll get the opportunity to practice a new way of presenting. Since January, I’ve set aside every Tuesday night from 6:30 – 9:30 pm (like a night class) to read and study the art of becoming an excellent presenter.
We will have 150 – 250 VC’s in a room and I’ll present for 20 minutes. Most companies presenting will have the standard 15-slide presentation that all VC’s see. Mine will be 43. But what’s really cool is that I’ll probably have less words than the 15-slide normal presentations. Instead, mine will focus on combining pictures that help people grasp – in two seconds – the big picture. I consider public speaking an art, and as an artist, I want to be as engaging as possible and leave people with a feeling that they want to talk further with me about the company.
Here are some slides from my presentation:
Steven Cox, CEO of TakeLessons and winner of 2010 San Diego Venture Group Pitchfest gives an update one year later on the progress the company has made since winning last year.
…Here’s a very simple message for our teachers and that is: you go teach and we will curate the absolute best instructors throughout the nation.
In fact, we hire about 5% of the instructors that apply to work for us as a contractor. We end up curating the top 5% based on an algorithm that we’ve written, as well as personal interviews that we assess each and every one of their character traits.
For the customers,we provide safe, certified instructors for them. We’ve build online tools that make the site very unique that you can’t find anywhere else in the nation. We offer 100% money back guarantee, so anyone can go out and try lessons and if you don’t like it, just give us a call back and one of our friendly counselors will refund your money.
In essence, what’s happening is the business is going really, really well.
So, I’d like to give you an update on what’s happened. We were looking for a 3 million dollar raise as of December of last year, so we started in January and we took a total of 29 meetings, most of those were in the Bay area firms, we also talked to a couple San Diego firms, talked to Brian in the LA area. From there, this has kind of been the trait. So, in 2006 we had a seed round of $200,000, we did a round in 2008, followed that up in 2010 with $795,000 and last year we closed on our first institutional round for 6 million dollars.
Our lead investor on that was CrossLink Capital. Eric Chin is now a board member, and it was our very first institutional raise, and I can say that he has been an exceptional board member. We’ve now had two board meetings and they went pretty well. They had a lot of good information that they personally helped with out with, as a CEO, and they really opened some doors. Also in the round, we had Softtech Venture Capital, which has funded a couple of pretty good companies, and we are happy to be a part of that group. Also Maynard Webb, the ex-CEO of eBay, also came on board as an investor, and we are proud to have him, as we are looking to grow our marketplaces. We are very proud to get these folks into ground.
Employee growth: Let’s talk a little bit about how we’ve done since 2010. When we presented we were at 37 employees. As of today, in San Diego, we have 92, so we are growing. We are now located downtown [San Diego] and it feels really good to be able to provide great jobs for people, but also make the positive lasting impact on both our employees, as well as our customers. Next year we are going to be on a hiring spree. We expect by the end of the next year to be at around 155 to 165 people… so if you are looking for a job, please contact this table right here.
Quarterly revenues: when I presented last year, this is where we were on our quarterly revenue chart [show chart] and this year we will continue to grow. So, we have doubled in revenue this size off a pretty good base. Again, the capital really helped the team and everything we have been able to deliver quite well.
We struck a deal last year with Best Buy Musical Instruments. They have opened what is basically like a guitar center, inside over 100 of their stores, and we are now running the music lessons area for them. In fact, you can walk into a Best Buy, buy a guitar, and also take music lessons right there in the facilities. They are using all of our software and all of our instructors, in order to do that.
I think David, is actually a customer of ours –is that right? Down in Chula Vista? Perfect, thank you very much.
The Best Buy store roll out: we started at 32 stores, then we went to 103 stores, now you can walk into any single Best Buy store throughout the nation and buy a lesson pack and we will teach those lessons in your home. So that was just completed and we are announcing that here, this week, that now we are in every Best Buy store across the nation. It was a big roll-out and it took about a year and a half and we are really proud.
For 2012, what we are looking to do is once again double our revenues. Just as important as revenues, we also want to grow our people. We’ve never had the opportunity to really invest back into our people, with training and education and developing the culture the way that we want to. We think that this year we are going to be able to do that, and it feels really, really powerful and really good to be able to do that.
Also, one of our goals is to be in the top 5 companies to work for in San Diego. That is just as important to us as the development of the revenue side. So, this is what we are going to do this year.
I’d like to also give a big shout out to our “internal team”. It’s the folk who have been with us since day one:
-Randy Socel with DLA Piper
-Barney and Barney
-Wells Fargo and CoAmerica Bank have been awesome partners.
-Steve Martini from Quality First Commercial has kept us out of a lot of bad deals and gotten us into a lot of good commercial deals. So, we really appreciate you, Steve.
-All of our accounting firm team. [Round of applause]
So, finally all I would like to say is, I cannot tell you how much I truly appreciate the opportunity just from TakeLessions, to be able to come up here and present in front of the group. I’m sure all three of the contestants tonight feel the same way. I really wanted to encourage each and every one of you – the accounting firms, the law firms, the venture capitalists—we really need your support. Over the past three months I’ve been in probably 4 start-up gatherings. And over those past 4 gatherings, there was one venture guy that showed up, and I think we can do better than that. I think we can do better to support the scene. We are doing really well, but there is always room for improvement.
We just did a slide here, which show that there are 87 start-ups right here on this screen. It’s blossoming. We are seeing this every day. People contacting us asking, “hey, how do we get started,” “hey where do I go from here,” “who should I do my banking with,” “which venture guy should I reach out to…” We think that the scene is awesome.
You know, when we were doing our funding, the number one issue that CrossLink had was, “is there enough talent in San Diego. Can we pull in extra talent from San Diego in order to grow this business?” And really, what I would say is that that’s up to us here in this room. It’s not just up to the start-ups, the venture guys, but if we all work together, what I’d love to see—mainly because I don’t want to move to the bay area, because no one wants to live in the bay area, over San Diego— we’ve got an opportunity to grow this thing, as a group.
So, what I wanted to do was challenge each and every one of you, to look around and say, “how can I get more involved in the San Diego scene?” The San Diego Venture Group has pushed us off to a great start and we really appreciate the opportunity, but it’s time to step up our game.
I want to encourage you to raise the game and make San Diego awesome. Thanks so much!
Mary Meeker, one of the most interesting forecasters, gave a presentation on her view of where the internet is going.
A stat I found fascinating is that ecommerce makes up less than 10% of the total pie. That means there's still a long way to go before we reach an equilibrium point. When you consider that services, as an industry, is far behind products when it comes to online commerce, it bodes well for companies like TakeLessons, Limos.com, Kitchit, and othes that are looking to create service brands that customers can trust.
I believe we're still in the early days of Service Commerce for the web and mobile.
From our friends at CONNECT:
For entrepreneurs, deciding to form a company, or become involved with a start-up, presents enormous challenges. Navigating around legal, fund raising and other issues can often seem overwhelming, and traps for the unwary or uninformed are numerous. However, successfully avoiding the most common pitfalls made by entrepreneurs can make a significant difference as to whether or not a company is fundable, the sources and types of capital that will be attracted, who controls the company, the economic impact on founders upon exit, and a company’s likelihood of success. In this interactive half day workshop, Roger Rappoport will discuss these and other issues in three interactive sessions.
What you will learn:
Who should attend:
Date: Wednesday, September 14, 2011
Time: 8:00 a.m. – 11:30 a.m. (Registration begins 7:30 a.m.)
Location: Sanford – Burnham Medical Research Institute
10905 Road to the Cure
San Diego, CA 92121
Note: A light breakfast will be provided for participants.
Contact: Linda Wells
Fees: Pre-Registration $45.
At the Door $65. (subject to availability)
*Registration will close on or before September 13.
Full-Service Music and Voice Lessons Provider Leverages Internet to Unite Students and Music Teachers
SAN DIEGO–(BUSINESS WIRE)–TakeLessons, a full-service music and voice lessons provider offering private lessons in over 2,800 cities across the U.S., today announced that it has raised $6 million in funding led by Crosslink Capital, with other investors including SofTech VC and other prominent angel investors. Founded in 2006 by Internet entrepreneur and avid musician Steven Cox, San Diego-based TakeLessons helps music students connect with a Certified TakeLessons™ instructor that most precisely fit their needs regardless of age or skill level. Eric Chin, partner at Crosslink Capital, will join the Board of Directors as part of the transaction.
“TakeLessons was founded out of a personal experience. A friend was searching for a guitar teacher for her 7-year old daughter and didn’t know where to look. An Internet search turned up a list of teachers, but no way to compare them or to see if they were experienced, professional, and safe to come into her home,” noted TakeLessons founder and CEO, Steven Cox. “That’s when I realized there was an opportunity to use the Internet to establish a national brand that would stand behind the customer, offer a safe, exceptional service, and help artists make a living doing what they love.”
Scheduling and payment is handled by the TakeLessons platform, which then pays the teachers, letting both students and teachers concentrate on the lessons, while the company handles the administrative functions.
“The moment we heard about TakeLessons we were intrigued by its concept,” said Eric Chin, partner at Crosslink Capital. “Our research convinced us this was a business idea and model that has almost unlimited potential in the world of music and well beyond. Meeting Steven and his team sealed the deal for us. They’re as passionate about this business and its future as it gets. We’re looking forward to working with them to grow this brand.”
TakeLessons currently offers students access to a roster of teachers in 35 music classes, including voice lessons, piano, drum, guitar, singing, and saxophone. The company also offers courses in less common instruments, such as harp, mandolin, ukulele, harmonica and Flamenco guitar, as well as DJ lessons, music recording workshops, songwriting, speaking voice and music performance.
TakeLessons has a meticulous, multi-step screening process for its teachers. Fewer than eight percent of teaching applicants make it through the selection process and receive the Certified TakeLessons™ Instructor designation. Students are asked for feedback after each lesson, and teachers that continually receive mediocre or poor report cards are dropped from the lineup.
TakeLessons recently partnered with electronics and technology giant, Best Buy, to offer music lessons inside their stores. As of June, TakeLessons teaches in over 50 Best Buy stores nationwide, with more stores to be announced in the fall.
Founded in 2006 to help people discover their creativity and pursue their passions, TakeLessons is America's leading full-service music and voice lessons provider. With lessons taught by Certified TakeLessons™ instructors in thousands of cities across the US, TakeLessons makes it easy for students to start living their dreams through music. TakeLessons also offers turnkey music programs for schools, government agencies, and community centers, as well as at-work lessons programs for corporate clients and their employees. Visit the company at http://takelessons.com.
About Crosslink Capital
Crosslink Capital is a leading stage-independent venture capital and growth equity firm with over $2 billion in assets. Crosslink, which traces its roots back to 1989, was among the first and largest investment firms in the U.S. to integrate public and private growth/technology investing in three families of funds: venture capital funds, long/short hedge funds and a unique hybrid crossover fund. This strategy allows Crosslink to partner with its portfolio companies on a long-term basis. With more than 20 years behind it, Crosslink Capital has invested in over 100 private equity portfolio companies, at the early, mid, and late stages including Pandora (NYSE: P), Ancestry.com (NASDAQ: ACOM), Omniture (acquired by Adobe Systems), Equinix (NASDAQ:EQIX), Virage Logic (NASDAQ: VIRL), Carbonite, BlueArc, Force10, Intematix, SeaMicro, and Yipes (acquired by Reliance Communications). For more information on Crosslink, visit http://www.crosslinkcapital.com
…As we continue to expand, I encourage you to master your current position and begin to prepare yourself – at work and on your own watch – for the position you want to grow into. It will be those who continue to require more of themselves who will be the ones that naturally rise up. Will it be you?