Business in Vancouver's “How I Did It” feature asks business leaders to explain in their own words how they achieved a business goal in the face of significant entrepreneurial challenges. In this week's issue, Trulioo co-founder and CEO Stephen Ufford talks about how he decided to move to Silicon Valley for a few months to land the $2 million he needed to launch the company, which has since attracted a total of $8.3 million in venture capital.
“Trulioo was our fourth startup. We [Ufford and Tanis Jorge] had three startups since we were 20. IQuiri, our first startup, went on to become a billion-dollar business.
“Our goal, from a business perspective, is to become the purveyor of trust online. The problem that we're trying to fix, fundamentally, is this problem that everything is anonymous online. To fix that problem, we have developed a technology that is capable of letting three billion people in a completely online environment prove who they are to each other and to companies and to governments. We estimated that our business would take a minimum, if we were lucky, of $10 million in capital, and most probably $50 million in capital. We were in a city and a country where venture capital is geared for smaller-scale business and also for a different risk profile. I knew the pie had to be bigger on this one, so I went to the Valley.
“By going to the Valley, we were able to receive a $10 million valuation out of the gate. The size of the pie you start with dictates the size of the company you build. If you sell the first 20% of your company for $200,000 up here, it's then very hard to go down to the Valley and do a Series A that's large enough, because it's based on a much smaller valuation.
“I spent September 2009 to July 2010 putting together the business plan. We had the business plan and the mobile app by 2010. Then my brother [Kevin] and I packed up the car and moved down to Sunnyvale, which is on the outskirts of San Jose.
“Despite having several exits, I knew nobody. I had no contacts, no network in the Valley, so I [plugged] into a large incubator, a tech centre called Plug and Play. The [Canadian] government sponsors the Canadian Technology Accelerator there. Within this building, our lovely government sponsors about 12 desks there, and those 12 desks are available to Canadian startup entrepreneurs simply by asking.
“With 300 startups all under one roof from all over the world, that attracted dozens of venture capital [VC] firms to come and hear pitches. I was put on a cycle where my one-pager that I wrote would be given to every VC that came into the building. When they came, you'd get 15, 20 minutes to pitch. Blumberg Capital was one of the first VCs I met.
“They followed me, and about six or seven months down that process, one of them finally said, ‘You've really gotten somewhere now. Come and meet all the partners, and let's have a serious talk about an investment.'
“We had a US$2 million investment in 2012 just from Blumberg Capital. Once I got the cheque, we opened our office in Vancouver.”