Rabbu CEO Emir Dukic has raised several rounds of capital over the past couple years to help accelerate growth and build out his company. Identifying those capital partners for the online property management startup is a process, he says.
One qualifier was geography. Being based in Charlotte, the company looked up and down the east coast, down to Miami, into Georgia, up to New York and Boston area. Then he says he created a target list of investors that he'd done diligence on, groups that are interested in his space — for Rabbu it's proptech and fintech. Then the list was narrowed by excluding investors that already work with a company Rabbu would consider a competitor. Connections were then made first with investors within their network.
"It's a process," Dukic says. "You can't just be like, OK, I'm raising capital, let me go call these random investors. It's really building on a process and a timeline. And then the collateral, building out the deck, refining the pitch. Starting off with the friends and family to just practice the pitch, then working with some newer investors to get your pitch down, and then graduating your way up to the large check."
To identify the right capital partner, Dukic says he had to get out of the mindset that can exist when first going out to start raising capital, which is, Who can I find to give me money. Instead, it's about finding the right fit.
"The more people I talk to, the more I realize actually this is a two-way street," he says. "As much as I'm technically interviewing for them to give me capital or get the company capital, I need to do the same thing on the other end."
Working with an investor is often a five-year commitment, so it's important to make sure that you're aligned with the group you're going to work with.
"So, for us, it was really making sure that we did the diligence and we went through the process," he says.
To do diligence on behalf of Rabbu, he says he met with most of the investors initially first, including other team members in the meeting, to make sure that they felt like they could sync with the investors, that it wasn't just taking the capital. He says they used reference checks on them in part to see if their portfolio companies were happy to work with them.
"So, it was really a combination of interviewing them as for a job position at the companies, going through some very similar protocols to get that established," he says. "Honestly, I thought we were successful in doing so."
Dukic spoke at last year's Charlotte Smart Business Dealmakers Conference about his company and the process of raising capital. Hit play on the video above to catch the full interview.