Thought Leaders in Financial Technology: NorthOne CEO Eytan Bensoussan (Part 6)

Sramana Mitra: It’s a very crucial point where you raise your first institutional round of financing. It doesn’t have to be an institutional round, but it has to be a seed round. How much was the seed round?

Eytan Bensoussan: It was $1.7 million.

Sramana Mitra: The investors are from New York??

Eytan Bensoussan: They’re from everywhere. There were investors from a little bit of everywhere. That was one of the more challenging pieces because you had to find people who not only could believe in you as a leader but could believe in your vision as a business. They knew that many of the banks out there would not accept this. This was a threat to many of the banks at that time. Now a lot of banks appreciate what FinTech does. It was a game of finding people who saw it and then locking them in as quickly as you could into the round.

Sramana Mitra: How did you find these people?

Eytan Bensoussan: You find one person who shows interest. Then he has five people he can talk to. I asked everybody I knew who they knew to be an investor. That wasn’t a great approach. I wasted an enormous amount of time talking to people who were never the right fit. I probably got about 150 rejections to get 10 or 12 people to say yes. That is pretty true over time. The thing that got smarter as time went on was figuring out who are the right investors. Target the people who know the space.

Sramana Mitra: In One Million by One Million, we don’t do the actual funding, but we work with hundreds of investors. We focus very much on investor-entrepreneur fit. You have to find the right investor who’s likely to do that stage of investing in that sector in that geography. Through One Million by One Million, people get introduced to 25 to 40 investors. I wish I had someone to tell me.

Eytan Bensoussan: It sucks when you’re on your 90th call and have seen three rejections in the morning. You have to give them the same energy.

Sramana Mitra: It’s so destroying. Rejection after rejection is destroying. Since the seed round, you have raised more money. Through the pandemic, you have been able to raise more money.

Eytan Bensoussan: The seed round unlocked something. It gave us this opportunity to show what we could do. That’s all that we needed. It allowed us to launch the company and realize how much of a vacuum there was for what we were building. We launched and we thought there would be a small drip of people coming in.

Businesses by the thousands had been waiting for offerings like ours. You can tell that it was such an underserved segment. It was just growing really quickly. We were able to have a larger institutional round right at the cusp of COVID. It happened right before our world changed dramatically. That gave us the fuel and certainty to think of the way the world changed as an opportunity. That was helpful.

Sramana Mitra: Of that 100,000 on the waitlist, how many of them converted once you launched?

Eytan Bensoussan: We had a meaningful conversion. It happened over time. Six to nine months after we launched, people got around it. It makes sense by the way. At some point, someone had a need. It evolves. Over time, we have gone through 20% to 30% of that waitlist. There are still folks in there that are saying, “I don’t need a banking account just yet.” I built some relationships with those early waitlisters.

This segment is part 6 in the series : Thought Leaders in Financial Technology: NorthOne CEO Eytan Bensoussan
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