This Stanford Dropout Raised Over $100 Million To Reinvent How We Commute In Cities
Sanjay Dastoor has launched two startups in the mobility space and has learned a lot about business and fundraising strategy in the process. The way we get around has been changing a lot. Sanjay Dastoor and his startups may prove to be just as influential in how millions of people get from point A to point B. All without worrying about who your driver is going to be.
Sanjay Dastoor recently appeared on the DealMakers Podcast. During his exclusive interview, he shared what he’s learned about business models, fundraising from top tier investors, building teams of A+ individuals, why he attended Y Combinator twice, and many more topics. The Tesla of Micro-Mobility Sanjay Dastoor’s parents were both instrumental in ingraining the foundation of a lot of his work as an entrepreneur. His mother was in industrial engineering and operations and started her own business. His father helped him learn how to program when he was in middle school. Sanjay moved to the Bay area to study mechanical engineering at Berkeley. Spent some time at NASA. Then pursued a Master's of Science, and ultimately a Ph.D. in engineering at Stanford, before dropping out. He ended up spending a lot of time in college, in an interdisciplinary biology lab that studied how animals moved. How you could apply what you learned from biology to different fields, like computer animation, robotics, and prosthetics design. Boosted Finding a love for last-mile transportation, Sanjay’s first startup became Boosted, the electric skateboard company. With two highly qualified cofounders, they set out to find a more fun way to get around the city and to navigate the campus more quickly and easily. Somewhere between snowboarding, longboarding and toying with new motors and batteries the electric skateboard was born. They put some of their own savings in, went to file a patent, and built prototypes. They didn’t expect it to turn into this massive thing. Yet, people kept chasing them on campus to find out where they got their new wheels and how they could buy one. They got accepted into Y Combinator and StartX. That gave them some money and time to focus on developing this. This was also the early days of crowdfunding and Kickstarter. Of their first five users, three became investors. Their Kickstarter campaign raised around $400,000, for around 350 boards. Fundraising Strategy & Business Modeling Boosted’s founding team learned a lot along the way, and Sanjay shared the key takeaways from their experience in fundraising and developing their business. 1. The Advantage of Under Promising When you preorder an iPhone, Tesla or book, you are buying perception. Often the customers' perception and ideal can be significantly loftier than the reality of the product unless expectations are well set. As a startup, you can live or die by word of mouth. Which makes it smarter to underpromise and overdeliver. 2. Watch Out for the Mechanics of Scale Producing and selling at a larger scale can be a whole different realm in terms of manufacturing, profit margins, and logistics. Some of those may mean sacrificing quality and experience in the beginning. You may not want to raise as much as you can, just to get those big figures. Get everything else right, and then scale. 3. Crowdfunding is a Stepping Stone One of the best benefits of crowdfunding isn’t the money. It is the social-proof to show validation, prove that the market is ready for what you are doing and get those fundraising conversations with the larger ticket-sized investors. 4. Focus on Retention Retention is a much better sign of business health than just downloads or installs. Even with hardware products, ensuring the customer is still using the product later says a lot more about your company, as well as opening more revenue opportunities. Think about Peloton versus most of those old static cardio bikes lost in people’s garages collecting dust. Investors like recurring revenue and it's good for a business in many ways too. Though you’re going to have to become a relied upon part of daily life like a smartphone if you’ll break through to that level. 5. Forget about the Competition Competition can be scary. It's very easy for companies to be scared by competitors. One great lesson Sanjay picked up at Y Combinator is it's much more likely that you'll be hurting your own company through your own work than from a competitor. Focus on your own users and how to serve them, and not spending your time thinking about your competition. 6. Surround Yourself With Great People Sanjay says “There's a lot of joy that comes with working with people who are really great at their area of study.” If you seek out the people who are very excellent at what they do and build that expertise around you quickly, they’ll help build the company. So far, Boosted has raised close to $70 million from top investors like Khosla Ventures, SV Angel, and iNovia Capital. Skip Scooters After the success of Boosted, the company hired a CEO and Sanjay went on to launch his latest venture, Skip Scooters. You’ve probably seen them in the street if you’ve been in San Francisco or DC lately. They have the first fleet of vehicles in history where every vehicle is always connected to the internet. What might be even more impressive for other entrepreneurs and investors is that Skip Scooters did their Seed, Series A, and then a big debt round of around $130 million, all within the same year.
Investors of Skip Scooters include Accel, Y Combinator, SV Angels, Menlo Ventures, Initialized Capital, and Maven Ventures. Listen in to the full episode to find out more, including:
Benefits of attending startup accelerators · Why scooter-sharing is such an attractive model · Why we don’t have more micromobility and shared vehicle options · How to test and validate ideas · The essence of successful crowdfunding campaigns
