From May '08 when this round was completed. For a full year.
Plugged away at three initiatives.
General improvements to website.
Built set of web-based tools.
Sold to physical stores.
Main issue - for comics, you can't return inventory.
Diamond had no need to take back inventory - they have a monopoly.
iPhone app. Burned through about $200 of $350K.
At the time, only had 3 employees. 2 tech guys. Spent all time building out.
Helped build iPhone app.
If notion to do that, that is burn rate you'd expect.
You would not get fancy office and bring in more people.
Lot o in more people.
Lot of subcontractors and consultants.
Main reason: in general, remain as lean as possible until you have reached inflection point.
If you keep raising money, you'll get diluted to nothing.
Plugging along '09 to mid '09. Launched iPhone app. Had minimal initial attraction.
2000 downloads first week.
Started selling, $50 first week.
$200 sold next week.
Started ramping up.
No other players.
By end of the year, '09, had developed moderate amount of traction by tweaking their app.
continued to bring on small independent publishers.
Still around $10,000 sales per month. Burn at that point is $25-30K. Still burning cash at significant clip. Nowhere near sustainable. No interest for another VC round.
Had achieved milestones.
Need to bring in money.
With burn, close to running out of money.
Went to do a follow on.
This brought in additional $250K. And a bit more money.
You can renegotiate.
Interesting. Not amazing.
Warrants bringing in additional money.
Brought in NY Angels. Do an expanded round. Raised $450K.
True series A.
The closeout money, January this year. Had some general interest from Marvel Comics.
Pause it there.
Q: How the structure changed after each round.
First tranche was a convertible note.