Dive deep into Snorkel.AI’s pitch technique that raised $135m

Storytelling is an art as old as civilization, but it’s rarely taught anywhere despite the fact that the ability to tell a good story is instrumental to success in many, many fields.

Fundraising is one area where good storytelling can be table stakes, but few founders know how to communicate clearly and succinctly how their idea solves a problem.

Snorkel.AI’s co-founder, and CEO, Alex Ratner, honed his storytelling chops at a Stanford lab, and that ability, he said on a recent TechCrunch Live episode, was key to helping him raise $135.3 million over four rounds since the company was founded in 2019.

“I was a pitch deck nerd even before giving a real pitch deck,” Ratner said. “I had it drilled into me on the academic side, that communication is everything. You could have the fanciest, highest-performing method. Still, it means nothing if you cannot communicate how it maps to real problems and how it is contextualized within alternative solutions.”

Ratner was joined on TechCrunch Live by Saam Motamedi, Greylock partner and the lead investor in Snorkel.AI’s $3.3 million seed round.

Listen to the episode, and it’s obvious Alex Ratner is good at telling his company’s story. Passion and savviness come through with ease, though when pressed, he admits he’s given this talk countless times — and that was the over-arching theme of this episode. Of course, it takes practice to pitch well.

This episode is a must-watch for anyone preparing a pitch. Ratner and Motamedi drew a straight line from a pitch to raising early funds, and the starting point is a clear message.

“I think anyone can learn to be an exceptional storyteller,” Motamedi said, adding, “Alex has been a phenomenal storyteller from the time I met him. But, that said, I think his ability to tell this story has improved dramatically over the last few years.”

Motamedi points to Snorkel.AI’s pitch as an excellent example for entrepreneurs trying to improve their storytelling ability. It’s a critical balancing act between presenting a 30,000 ft. view of the market and the problem the company is solving that adds value to the customer.

“To be candid,” he said, “the startup just needs to get this right.” It can directly lead to seed or Series A investment, along with convincing the investor the company has the right team in place. “These are the two things we look for at seed and Series A.”

Robotics founders: Build your pitch deck around problem-solving, not technology

In robotics, the remarkable often feels at odds with the practical. The Cassie robot captured the internet’s imagination (ours included) when it debuted in 2017 through a series of Oregon State University YouTube videos. It was one of the most exciting examples of robotics engineering since Boston Dynamics first made the scene.

Commercial applications, however, are a different conversation entirely. In a world of purpose-built systems, it’s not the first thing you see when you gaze upon the skinny legs of the ostrich-inspired bipedal ‘bot. When Agility Robotics first spun out of OSU’s College of Engineering, Cassie was being produced for research facilities. It’s a worthy mission, but not exactly a cash cow.

In a recent episode of TechCrunch Live, Agility’s co-founder and CTO, Jonathan Hurst, and Playground Global’s founding partner, Bruce Leak, joined us to discuss the robotic company’s journey from the lab to the commercial sector — and the role a good VC firm can play in that journey. The conversation spanned 30 minutes and includes a look at Agility Robotics’ early pitch deck. The deck and video are embedded below.

“If you’re building a company that’s building something that is really new and different, where are you going to hire engineers with experience with highly dynamic physical interaction, in the world, with force-sensitive behavior?” asks Hurst. “It’s just not common. Having students using the robots and a whole pipeline of people not only helps us, but it helps the whole infrastructure.”

From lab to launch

Playground Global, an early-stage investment firm based in Palo Alto, discovered the robot the way most of us did – watching cool videos online.

“We were surfing the internet like any good venture capital group, and we ran across the video that Agility released,” says Leak. “We were super impressed. This product, at some level, was just an incredible pair of legs. But it could walk for hours and even run across uneven terrain in a very practical way. Seeing something like that, which we thought might not even be possible, we knew we had to meet the Agility team.”

Agility’s seed/Series A pitch deck wasn’t focused on things like addressable market, and its insights into the robots’ practical commercial applications were cursory. What it did, however, was break down the startup’s impressive technologies. Hurst points to a tone shift between the presentation’s first slide, reading “Dynamic robots for human environments,” and its penultimate, “Made for work.”

Leverage early investors when raising a Series A, says DeepScribe’s Akilesh Bapu

Raising a Series A is a different ball game from raising a seed round, and for Akilesh Bapu, CEO and co-founder of AI-powered medical transcription platform DeepScribe, giving prospective investors a hard deadline while leaning on early investors for support and guidance made all the difference.

“We were at this trajectory as a company where we had a semblance of product-market fit,” said Bapu, reflecting on the summer of 2021. “We had proven our product. We had about 200 live customers on the platform… We were excited about bringing DeepScribe to more customers and looking for the best partners to us there — not just in the short term but also in the long term. We had a long-term vision… and wanted a partner that bought into that vision.”

Eventually, the company closed a $30 million Series A round led by Index Venture partner Nina Achadjian, as the duo discussed on the latest episode of TechCrunch Live, our weekly program featuring entrepreneurs, developers and investors. The entire episode is available below, along with a portion of DeepScribe’s Series A pitch deck.

If not for the fact that Bapu and his team had set deadlines for the funding round, he said DeepScribe might have not partnered with Index — Achadjian was on vacation when she read their pitch and tried to push the meeting to the following week, but Bapu said the process was moving fast. They met the following day.

Afterwards, Achadjian was sold. “When I walked out of the meeting, I went immediately to one of my partners, and was like, ‘Finally, I found the company that is following the right approach,” she said.

When I walked out of the meeting, I went immediately to one of my partners, and was like, ‘Finally, I found the company that is following the right approach.’ Nina Achadjian

She added that this was a critical win for DeepScribe, as it’s essential to leave potential investors fired up and armed with a few bullet points, including on the team and market.

Prepare for due diligence

Since Index was interested in DeepScribe, the firm started conducting due diligence.

Achadjian said founders can expedite the process by anticipating questions, especially on market size and competitive landscape. Companies can also provide investment firms with summaries of customer call notes.

“Then we come up with a list of key questions we want to go deep on,” Achadjian said. “What’s the business model? How do you scale? References. I actually called one of Akilesh’s Berkeley professors. We do a lot of customer calls and check references on the entrepreneurs. Then, honestly, we like to spend time with the team and see them in different environments.”

Hear how Snorkel AI pitched and won over Greylock on TechCrunch Live

Snorkel AI was founded in the summer of 2019 and over two quick years raised a total of $135.3 million in funding over five rounds. The rocket ship seemingly still has fuel, too. The company isn’t slowing down, and TechCrunch Live is thrilled to host co-founder and CEO Alex Ratner and Greylock partner Saam Motamedi. 

Snorkel AI started at the Stanford AI Lab, where the team caught the attention of Greylock. The VC fund provided the company with seed capital and office space. Later, it led the $12 million Series A and participated in its $35 million Series B and $85 million Series C. Greylock partner Saam Motamedi joined its board of directors following the Series A. 

At Greylock, Motamedi focuses on enterprise companies, with investments and board seats at Abnormal, Apiiro, Utmost and others. In addition, his background makes him a great partner for early-stage founders. Prior to joining Greylock, Saam founded Guru Labs, an ML fintech startup, and worked in product management at RelateIQ, which Salesforce acquired for $400 million.

In 2019, at age 26, Saam Motamedi became Greylock’s youngest partner to date.

We’re excited to host both of them on an episode of TechCrunch Live taking place on March 9 at 11:30 am PT / 230 pm ET, where we’ll talk about how the two connected and what made Greylock a good partner for Snorkel. Click here to register for free!

TechCrunch Live is all about helping startups build better venture-backed businesses. Founders and the investors who finance them sit down to talk about how they met, what kept them interested in one another and, ultimately, how they sealed the deal. We also discuss the relationship that they share in working together through scaling.

Plus, this episode of TechCrunch Live includes the TCL Pitch-Off. Folks in the audience can come on to our virtual stage to pitch their startup to our esteemed guests and get their live feedback.

TechCrunch Live is free to attend and goes down every Wednesday at 2:30 pm EDT/11:30 am PDT. However, only TechCrunch+ members get access to the on-demand version of the episode, as well as the complete library of TechCrunch Live content. In other words, bite the bullet and subscribe to TechCrunch+.

Smash this link to register for TechCrunch Live with Snorkel AI and Greylock!

Hear from these amazing investors and founders on TechCrunch Live this March

TechCrunch Live has an exciting slate of episodes scheduled for March. The speakers come from a variety of disciplines, backgrounds and locations. Like always, each episode features an entrepreneur presenting their early pitch deck along with the investor who funded the company. We want to know how the founder hooked the VC, what makes their partnership work and how other founders can improve their storytelling and pitching.

We have Agility Robotics’ co-founder and CTO, followed by Snorkel AI presenting an early pitch deck, which laid the groundwork to raise $135 million in two years. DoubleVerify and early investor Blumberg Capital is speaking on how they’ve worked together since 2008.

TechCrunch Live helps founders build better venture-backed businesses. We do this by bringing together startup founders and the investors who back them to talk about what, precisely, helped close the deal. What metrics are the investors looking at? What questions did the founders answer that made the VCs want to learn more? How did the founders communicate their grand vision, and what was the step-by-step plan to get there?

We cover all this — complete with looking at these companies’ early pitch decks and more — on TechCrunch Live. TechCrunch Live is also home to the TCL Pitch-off, where founders in the audience can get on our virtual stage to pitch their startup to our esteemed guests and get their live feedback.

As with any TechCrunch event, this weekly series also features networking so you can meet and greet other attendees.

The event goes down every Wednesday at 11:30 am PT / 2:30 pm ET and is free to attend. Networking and the pitch-off submissions start at 11:30 am PT, followed by the interview at 12 pm PT and the live pitch feedback session at 12:30 pm PT. Only TechCrunch+ members get access to the complete library of on-demand content, so if you haven’t yet, sign up now!

And without any further ado, here is a look at the outstanding guests joining us on TechCrunch Live in March.

Bruce Leak (Playground Global) + Jonathan Hurst (Agility Robotics)

March 2 – 11:30 am PT / 2:30 pm ET

Agility Robotics co-founder and CTO Jonathan Hurst will join Playground Global founding partner Bruce Leak to discuss the firm’s unique approach to warehouse logistics. Founded in 2015 using technology developed by the Dynamic Robotics Laboratory at Oregon State University, Agility has become a major force in robotics.

Register for TechCrunch Live with Playground Global and Agility Robotics

Image Credits: Hieu Tran / Agility Robotics

Saam Motamedi (Greylock) + Alex Ratner (Snorkel AI)

March 9 – 11:30 am PT / 2:30 pm ET

Snorkel AI was founded in the summer of 2019 and over two quick years raised a total of $135.3 million in funding over five rounds. The rocket ship seemingly still has fuel, too. The company isn’t slowing down, and TechCrunch Live is thrilled to host co-founder and CEO Alex Ratner and Greylock partner Saam Motamedi.

Register for TechCrunch Live with Greylock and Snorkel AI

Image Credits: Greylock / Snorkel AI

Yodfat Harel Buchris (Blumberg Capital) + Oren Netzer (DoubleVerify)

March 16 – 11:30 am PT / 2:30 pm ET

Oren Netzer and his co-founder Alex Liverant started DoubleVerify in the heady Web 2.0 days of 2008. Blumberg Capital was the company’s first institutional investor. TechCrunch Live is thrilled to have CEO Netzer and Blumberg Capital partner Yodfat Harel Buchris speak to DoubleVerify’s early pitch deck.

Register for TechCrunch Live with Blumberg Capital and DoubleVerify

Image Credits: Rachel McFarlin Photography / DoubleVerify

The Found podcast is coming to you live in March with Cityblock’s Toyin Ajayi and Tala’s Shivani Siroya

The early bird gets the worm. And what is the startup world if not a bunch of early birds snatching up an excess of worms? And yet I come bearing even more worms. (This is getting weird, but roll with it.)

Found, TechCrunch’s kickass new podcast that tells the stories behind the startups, is coming to you live in the month of March. Darrell Etherington and I are sitting down with Cityblock’s Toyin Ajayi on March 3 at 10am PT / 1pm ET and Tala’s Shivani Siroya on March 17 at 10am PT / 1pm ET to hear all about their journeys as founders.

If you’re not yet familiar with Found, this would be a great moment to get in the mix.

Found is usually published on the podcast app of your choosing each Monday, but for a few select episodes, we’re bringing this content to you live. You can hang out with Toyin, Shivani and us in a live video broadcast as we have candid conversations about startup peaks and pits, fundraising, leadership styles and more. Oh, and you can ask your own questions via the chat right as we record!

Click here to register for Found Live with Cityblock’s Toyin Ajayi!

Click here to register for Found Live with Tala’s Shivani Siroya!

How Pilot convinced Index Ventures to think long-term about margins

On a recently recorded (and soon-to-be published) episode of the Found podcast, an entrepreneur told my co-host and me that he sees a broad swath of the venture capitalists out there as money managers, more focused on short-term gains and returns than long-term revolutionary technology.

Whether you agree or not, it’s hard to ignore the fact that the multipliers in Silicon Valley and the growth of software businesses have changed the way we think about a startup’s timeline.

“The pressure from [Index] caused us to work a little harder and be a little bit more precise in our instrumentation to be able to prove that the long-term trajectory would achieve certain milestones that would work for everybody.” Jessica McKellar

Pilot, a bookkeeping software service that has raised more than $160 million since inception, is not necessarily a stranger to the shorter-term desires of investors. Index Ventures partner Mark Goldberg, who led the Series A and Series B rounds for the startup, would be the first to tell you that the board and the founders had some early disagreements about how the company should operate.

Obviously, it wasn’t enough to stop him or Index from doubling down on the business.

We talked about all this and more on TechCrunch Live.

Doubling down

“It was pretty terrifying,” said Goldberg. “In my gut, I thought, ‘Wow, we better get this right.'”

A few things clicked into place for Goldberg to want to keep investing in Pilot. The first was that it was a real category-creation opportunity, in that bookkeeping was a $100 billion industry that was largely fragmented.

The second was the customer love for the product.

“We started to hear customers proactively calling us from within the Index portfolio saying that they hated doing bookkeeping and back office functions, and now they don’t have to think about it. They said things like ‘Whoever this Pilot team is, they’re doing some wizardry so I can just shut my brain off to the part of the business I didn’t enjoy doing.'”

The third was the conviction and dedication of the team to empathizing with and understanding their customers.

He recalled a time early on when the team was no more than 10 people, most of them engineers, when he visited the office on a weekend. They were all wearing green visors, doing bookkeeping for their customers.

“They weren’t doing it because they needed to for customer support, but because they really wanted to empathize with the customers for the product that they were building,” said Goldberg. “That’s the sort of sweat equity and market recognition that told me, if this continues to grow, there really is no ceiling on what this business could become.”

While that sort of dedication to understanding the user was attractive, it was not without its costs.

Counterintuitive convictions

“Pilot is a technology company wrapped in this lovely human layer of high-touch support for its customers, which is a bit counter-intuitive in Silicon Valley, where most companies don’t want humans in the loop,” said Goldberg. “That’s what I know and understand, and we had a view that this sort of tech-enabled service model could be very valuable, but we wanted to make sure that they could create a financial profile that had gross margins that reflected that of a software company.”

In its simplest form, Jessica McKellar and her co-founders felt very strongly that they wanted to focus on the customer fully and deliver great customer service from the very beginning. In a business where you are onboarding customers by ingesting the entirety of their financials, that can be costly.

Mixing the personal with the professional in startup fundraising

By the time CapitalG signed on for Webflow’s Series B, the no code web design service was already profitable – a rarity for an early-stage company. It was a good position for the company and investors alike. For CapitalG, it was clear that the startup was already on the right path. And for Webflow, it meant a bit of leverage and – perhaps more importantly – an opportunity to be choosier about who it brought on as investors.

Of course, this isn’t an option for every company. For a variety of reasons, it’s not always possible to take such a deliberate approach to launching a company – and profitability can seem like a downright pipe dream in those early days. If there’s one thing we’ve learned from doing these TechCrunch Live chats week in, week out, it’s that there’s no one-size-fits-all solution.

That said, there are some universal takeaways when it comes to finding the right investment firm. To hear CapitalG’s Laela Sturdy and Webflow’s Vlad Magdalin tell it, the investor/startup relationship has become a kind of genuine friendship. It’s a quality both parties point to as key for making these sorts of deals. At the very least, neither side benefits if the other is looking for a quick out.

As great as Zoom is, to me, that in-person experience takes you to the next level of getting to know someone. Laela Sturdy

In-person is still important

Look, I recognize the irony of talking about how important in-person meetings are during a Zoom interview. And it’s likely true that a significant number of the biggest deals are happening in a virtual forum these days, but it also seems likely that the in-person meeting isn’t going anywhere in the long run – even if the handshake part of the deal is on the way out.

“We started to exchange some emails and had a couple of Zooms,” Sturdy said. “We were still in the heart of the pandemic. I was conducting most of my business on Zoom and just starting to see some friends and family outside, 6 feet at a distance. Our first couple of conversations over Zoom, I was enjoying getting to know Vlad and the business. I floated the idea that we could maybe get together in real life, which, at that time, sounded like a very unusual thing.”

Stephanie Zhan walks through the Rec Room pitch deck that won Sequoia’s investment

Sequoia is one of the most sought-after VC firms in the world, and predictably, it sees plenty of startups competing for its attention.

In a recent episode of TechCrunch Live (formerly Extra Crunch Live), Sequoia partner Stephanie Zhan and Nick Fajt, founder and CEO of social gaming platform Rec Room, explained what the venture capital firm looks for in consumer-facing startups. We even took a look at Rec Room’s earliest pitch deck, the seed that ultimately grew into a business that has raised nearly $150 million.

This episode also featured the ECL Pitch-off, where founders in the audience pitched their products and services to our expert guests to get their live feedback. You can check out the whole episode as well as the Rec Room pitch deck below.

Love is the answer

Sequoia, alongside almost every other VC firm, prizes one factor when deciding to investing in a consumer-facing company: User love.

There are a handful of ways to measure user love, from NPS scores to retention and engagement metrics to reviews of the product.

Just a few weeks after it launched, Rec Room was seeing users average 26 minutes per session, and around 90 minutes per user every day, which meant that many users were coming back for multiple sessions.

Bear in mind that we aren’t talking about tens of thousands of users. But in small numbers, the product was resonating, so it stood to reason that it would also resonate with more people. Sequoia was very drawn to this, and Zhan noted that in consumer companies, user love is the most important thing she looks for.

“This wasn’t just people coming in, saying hi, and popping out,” said Zhan. “There was real engagement here, even in relatively small numbers. That’s what stood out most. That was the real magic.”

Alongside time per session, Sequoia used Rec Room’s ‘high five’ metrics to evaluate user love.

High fives don’t actually have any value in Rec Room games themselves. You don’t win or earn anything by giving a high five. But the metrics around high fives continued to go up as more people played.

Zhan elaborated:

Nick had been thinking a lot about what forms of communication and interaction matter. One of the things that I forgotten about, but I remembered re-reading some of our internal communication at Sequoia from while we were evaluating Rec Room at the time, was that we kept talking about this notion of high fives. It’s interesting. I literally had a count of the number of high fives that the current user base had at the time. And I wondered why do high fives matter?

Craft your pitch deck around ‘that one thing that can really hook an investor’

Michelle Davey’s pitch to Jordan Nof of Tusk Ventures about Wheel, a startup focused on providing a full suite of virtual care solutions to clinicians, was front-loaded with early metrics. It may not be standard practice to start with the numbers, especially early on, but she explained to us why she chose that strategy — and Nof told us why it worked.

Davey and Nof joined us on a recent episode of Extra Crunch Live and went into detail on why Tusk was eager to finance Wheel, walking us through the startup’s Series A pitch deck and sharing which slides and bits clinched the deal.

Extra Crunch Live is a weekly virtual event series meant to help founders build better venture-backed businesses. We sit down with investors and the founders they finance to hear what brought them together, what they saw in each other and how they work together moving forward. We also host the Extra Crunch Live Pitch-Off, where founders in the audience can pitch their startups to our outstanding speakers.

Extra Crunch Live is accessible to everyone live on Wednesdays at noon PDT, but the on-demand content is reserved exclusively for Extra Crunch members. You can check out the full ECL library here.

When to lead with traction

Davey emphasized the importance of not sticking to a rigid format for building a pitch deck. She said it’s important to instead focus on crafting your pitch around what makes you appealing and unique. That should be on the foreground and featured prominently.

For Wheel, that meant leading with traction, since the company had impressive uptake even early on. That remained true for their recent Series B raise, too.