Co-Pilot, a one-on-one remote coaching service, raised more than $4 million in May 2021 and got another $6 million in January 2022. Co-founder and CEO Matt Spettel says landing that first round as a young, first-time entrepreneur, was equal parts difficult and exciting, especially considering they had built a direct-to-consumer business in a relatively crowded space.
"The odds were against us, for sure," Spettel says.
But working in the founders' favor we're a relatively high level of traction and proof of concept by the time they went out to raise a round. That gave them additional confidence as they pitched to investors.
"It definitely helped because I think on a certain level that is what investors are looking for is the people who obviously truly believe in this concept and are willing to go above and beyond to make it a reality," he says.
Through those pitches, he also learned what investors measured. That led him to transition from just pitching the core team that was going to make the business work to pitching the business entity itself. It was an evolution in his approach.
But there's a balance between having the confidence that his venture was ready for investor backing and taking investor feedback to address perceived gaps or places to make improvements in the business. The company, he says, has a unique approach in the fitness space, one that required building software as well as a marketplace, bringing in coaches full-time and integrating them into the service. That meant that the idea was fairly alien to most venture capitalists he talked to, which led to a lot of gut reactions, as well as a number of questions about how or if the business could scale, if it could hire the number of coaches it needed or what its gross margin might look like. Ultimately, they determined the most important thing they could do is find the right investor for them.
"We came into it very much with an attitude of we'll know we'll find the right investor when they say something along the lines of, 'Yeah, this is going to be hard to scale, but it's worth it because you guys have something at the core here that is really special,'" Spettel says. "And we found those investors for both the rounds that believed in that core differentiation."
With the investors Co-Pilot landed, Spettel says the sense it they'll surmount whatever challenges the company is facing together rather than balking because there's not, in the investor's eyes, a clear path to becoming a behemoth.
Spettel spoke on the Smart Business Dealmakers Podcast about launching Co-Pilot, what he learned through fundraising, and what it's like going through a rebrand when investors are involved. Hit play to catch the full interview.