Scale the Founder Before the Company

Machine-generated transcript from the episode video. Speaker labels are not included and some names and product terms may be transcribed phonetically.

[0:00] I've learned that the best founders are always selling. Welcome to the GTM Vault podcast hosted by Rick Kleta. We uncover the strategies, the pivots, and the breakthroughs turning startups into giants. Let's crack open the vault and find out how. Welcome back to GTM Vault, the show where founders and revenue leaders decode how the fastest growing companies go to market. Today's guest has spent the last two decades helping entrepreneurs become the CEOs their companies need. VJ Rajandran is a venture builder, executive coach, and the author of the funding framework, which debuted as the number one new release in venture capital on Amazon. He's led portfolio value at 500 global.

[0:50] Helped founders raise capital in over 80 countries and now coaches high growth leaders on how to fund raise with confidence, lead with clarity, and scale without burning out. In this episode, we unpack how founders can align their pitch, energy, and execution to build a fundable business and grow into a resilient CEO in the process. VJ, you've supported hundreds of founders on their path to becoming CEOs. What consistently separates the ones who make that leap from the ones who stall out? You know what I see a lot? Companies with solid strategy, but terrible execution. They've got dashboards, reports, tools everywhere, but no one knows what to actually do next to scale their business. That's why I've been paying attention to what Zoom Info is doing.

[1:38] They're not just a contact data company anymore. They built a full system of execution. They're calling it GTM intelligence. And it actually works the list, writes the outreach, and triggers the play. No guesswork, no manual grind, just pipeline moving, predictable growth strategy that actually delivers. Check it out at zoominfo.com. Rick, thanks again for having me on. This is such a treat. I think that's an excellent question. There are diff a set of differences between people who can graduate from founder of a startup or leader of a small team to a chief executive officer of a company. And it comes down to can you scale yourself? And what that looks like is replacing a lot of hustle, a lot of uh iteration and a lot of intuition that is driving some of the things you do to intentional, strategic, awful leadership. you know that that is really hard uh for people to do particularly since you know you they've been asked to run a set of sprints really really fast to then pacing themselves over a marathon like that is a very different sport but

[2:47] that's a lot of what it feels like in terms of understanding I'm here I want to get there we've got a lot more to go um this is what I need over the duration of longer exercises and whether it's going from thinking about hey we've got to do X Y and Z in the next 60 or 90 days or else we are default dead to I've got to write an annual plan and fix a budget to it that we will actually follow over 12 months and I need to communicate a vision for the next 24 to 36 months to investors that actually is materially a different set of uh skills and uh elements that people need to stick with in order to be that type of more strategic coaching isn't advising. What's different about how you help founders grow coaching is on a spectrum you might say much earlier in my career I spent some time as a consultant. A consultant comes to you having done the work for you and giving you the answer. And as a coach I'm not trying to give you the answer. We're trying to find

[3:55] your answer. If the answers were so easily findable, we might be struggling with some of these these things. And so I think what what coaching can do is it can help people figure out their answer, come up with something that's authentic. I know we we use that word a lot nowadays, but something that means is genuine and specific to them. And that's what we're really trying to to to do is do that work together as opposed to an advisor saying, I think you should do X, right? We we need to make sure that you're successful and that means coming up with a solution together exploring truly what that looks like. I can relate. I remember when about 10 years ago when I started creator then which was a VCbacked influencer marketing platform. The VCs were all like advisers. I wish I had a coach that that kind of guided me through the process whereas you know the board members were looking out for their own right at the end of the day. They want to see you succeed, sure, but they want to see themselves succeed first. Yeah, that's very true. And I think the benefit of a coach is a coach is focused on you. Like

[5:04] they they are really uh attuned to your needs. And when I say you, I mean you as an individual. So there are things that you need to do for your for your own like well-being, for the things that you value. At the end of the day, something that many of us don't realize until it's way too late is people value fundamentally different things. And you gave a great example in terms of your board cares about different things than you do. But even between co-founders and people who join your company, they may have all joined or be doing what they do for very different reasons and different motivations. And that's that's oftenly bare, but not always something that people realize until much too late in their experience. uh starting and leading a business. What's the biggest mindset shift you see when a founder goes from fighting fires to leading with intention, you know, is it is okay to be a little bit reactive in your problem solving uh upfront because things that you didn't know you're going to have to do show up and you have to deal with them. So the biggest thing with strategic types of leadership and when you go to more in intentional leadership

[6:13] is that you start asking yourself what's important and not urgent and you spend more and more of your time hopefully on things that are important not urgent as opposed to things that are just and urgent and that isn't something that happens overnight. It's not like you got your series A and then like you suddenly make that jump. This is actually again something you train for and uh it's ju just like you don't go from running sprints to being a gold medalist um or a champion marathoner. There's there's a different set of things you try on in order to get better at managing yourself, your time, your calendar um and things of that nature. Now, while you're doing that, um you know, you ask yourself, well, what is important? And that's where again a coach can be helpful or someone in your life who you can work with is helpful in terms of explicitly underlying your core values because those core values give you a long-term vision. That long-term vision helps you know what's important and not urgent or important urgent that require your time and need to be an investment of your very scarce time resource. You

[7:21] know I remember being so emotional like I was in my mid20s at the time founder. where I was like influencer marketing, creating this new category. A lot of people doubted that it would be like scalable as an ad format. So, you have this mindset of like, am I going to make it? I don't know. You're constantly trying to reassure yourself that it's going to work out. So, as a result, and you're thinking things through, like everything, repeating it in your head, and as a result, I feel like it makes you so emotional and perhaps reactive. Um and and and that's where having a coach I feel like would have helped so much. Yeah, you're right. The the reactive nature of things does put you in a fight orflight mode and you need that to survive. We've all at some point in our experience as as humans needed that because that's a survival mode stick. That's really great because that's what got you here. But what's going to get you there is a is a different part of your brain that you want to try and activate more and more and it's really hard. In the funding framework, you lay out a practical approach to fundraising. What's the first thing you want every founder to

[8:32] internalize before they start raising? Yeah. I I think the first thing is that fundraising, like sales, like hiring is something people can get better at. It's a learned skill. So, what does that require? It requires people to understand that you're trying to build lasting relationships with investors because like you said, that person is going to play a big role in your life either as a board member or someone who will reinvest or communicate things favorable or unfavorable about you in the future and so on. And so you've got to find people who share your vision. They're bought into what you're trying to do and they can contribute something beyond capital. So I think that's like the first thing to internalize is you're trying to look for partners in some respect on this journey as opposed to just folks that are going to deploy capital and after the the TechCrunch headline comes out, you're not going to hear from them again. Yeah, that's a good point. I want to say like now that I'm in my mid30s, I feel like I I can think things through a lot more clearly than I could when I was in my whereas I

[9:42] was still in the process of learning and figuring myself out for the most part. That must be challenging like based on where you're at in your life, what you've accomplished. So, do you have like a technique when working with say younger founders compared to older founders? It's a great question. I do see differences uh between younger and older founders. I think that the younger founders have remarkable energy and there's a a certain like lore we have about founders who have let's say dropped out or left some type of path in order to go build something remarkable that they what they they need is I think structure. And so putting structure around what they want to do really helps because they've been successful just because of like unbridled energy, right? So channeling that for to oversimplify is really important. Alternatively, you have far more at times experienced founders and entrepreneurs what they're looking for from a coach is very different. I've noticed like repeat founders come to me saying I'm interested in doing X because it can be my legacy. I'm interested in doing

[10:51] something because I have a very specific vision and a set of goals that is tied to something I deeply want to exist in the world and because it it is linked to my values. So that doesn't mean that the younger person doesn't have a vision or doesn't care or doesn't have values. They're just not articulated very well yet. And so in the first case, you're trying to create intentional purposeful leadership. In the second case, you're trying to take that intent, intentional, purposeful leadership and be the sounding board that the later stage founder wishes they had, you know, two or three startups earlier but didn't uh know how to access. And so the the role is a little bit different. So, you know, I I I've uh I've noticed that among a few other differences between younger and and older founders with whom I work. How has the VC environment changed in 2025? What haven't founders adapted to yet? the VC environment has changed in a lot of areas basically over the last like 18 months you know we've seen um many more secondary transactions than I think we've observed before uh between

[12:00] you know you know funds selling founders selling we've seen the fact that you know some IPOs have come out uh and that's positive despite all the volatility and uncertainty in markets and so that's making some people feel optimistic But generally speaking, the biggest difference that I'm observing, and this has some Silicon Valley sort of bias, is is of course that the things that people thought they needed to do to be successful no longer are the high water marks or or or metrics that maybe they need to get funded today. What do I mean by that? A few years ago, if you had u a couple hundred thousand in um in ARR, if you're a SAS company, then you were uh fundable at at seed, you know, maybe a million dollars at series A and so forth. Everything in a high interest environment became, you know, somewhere like three to four times that number. Uh so that means if you want to go public maybe you need to have uh half a billion dollars or a billion dollars of uh of revenue right like everything has has

[13:08] has shifted tremendously from let's say the the the bubble of uh 2021 what that also means is uh that today with a set of companies that are achieving a lot of growth with very few employees using no code low code and AI uh are redefining what it means to be funded and achieving those benchmarks. So things move dramatically because of the shift in interest rates and then again because of what's possible with uh with with AI and very few employees and I think it it doesn't stop there. I think um you know using different teams that are offshore, remote, whatever uh different like styles of working you know being a very lean uh type of company you know has has opened the lens to like different types of business models and if you are managing and building a company like 24 uh then you you have to to to reset a whole number of things. Uh and that is very hard because you

[14:16] done perhaps a lot of things right to get to this stage. Uh but now what it looks like to be um funded uh is of course uh a lot more with done with a lot little to put it in a nutshell. Definitely companies are moving so much faster nowadays. more companies are realizing that they either adapt to this, you know, kind of fastm moving motion, this environment where you need to just break things and and move fast and fix them later on or you just can't compete anymore in today's day and age because everyone's moving fast. Yeah, everyone's moving really really fast. I think that that's a a thing that then investors are looking for is just like are you moving at this lightning pace? Something I have been exploring lately is how our previous notions of product market fit have changed. This is a thing that I think is going to be more pronounced as as we continue through 2025 is that investors um who used to think, okay, build this thing, you get product market fit based

[15:23] on whatever that looks like. uh and you then celebrate and the whole psychology of the company and your attention as founder shifts from build build to sell sell sell. And that's not the case if everyone else is moving really fast and the cost of replication or uh imitation by others uh is is going to be like really really low because they're going to catch up or or or exceed uh what you can accomplish. So sometimes signs apart market fit can be a false positive in the sense that they could lead you to sort of take your foot off the accelerator when it comes to you know the pace of product development. It turns out you just got to stay in product market iteration for a long long time because the chances are someone else comes out with another amazing model or another you know excellent tool or or a new category uh is discovered uh

[16:31] and uh it grows in the time that you're sticking to a plan that made sense you know four or five months ago. So uh yeah, I think that is is another big difference in 2025 and I think like some uh investors are are are realizing you know the the rate of change and the um the the the shift of like um of product market uh fit to now this like continuous uh experience and and continuous effort uh is going to be a big difference in how we we build lead and uh invest in future. Absolutely. things have shifted drastically, right? One thing I want to explore here is in a world where anyone can build product, finding PMF is so trivial, isn't it? In addition to that, it seems as though building an audience and engaging them throughout this journey has become even more important nowadays than ever, considering anyone can build up the same product in a very

[17:39] short time. Yeah, you're right. I I think people are continuously trying to iterate and develop their product as the market itself changes. So if the market is moving target and then then just like a a singular product development strategy or singular product marketing effort is not going to nail it, you're probably going to iterate that that very thing a number of times and and kind of stay with your foot on the accelerator. And so I think that's going to be a big difference now for for startups. One of the things you talk about that I fullheartedly agree with is that you say that confidence comes from clarity. Yeah. What are the three things a founder must be clear on before they step into the room? Yeah. I the the the thing that we think we're going to do is we're going to feel confident when we have raised some money or we've closed a big sale or we ship a product. And it turns out like it's not conditional on those things. It's just from like knowing you walk into the room understanding this is why I'm building this business. Here's why it it matters to the world and here's why now is the time. They're like and

[18:51] articulating why now and this is our moment. And that is like very important before you start talking about features and benefits for a customer to hear or where before you start describing the investor and and their thesis match with your company. And it's important to be able to say that before you bring on somebody who's going to take some career risk and personally invest their time and energy uh and um and talent in your business if they're a hireer. What makes a pitch truly resonate with investors today? What's missing from most decks? I think there's there's an under emphasis still today on team because when you ask founders like why did you invest? You know, they they felt this team was exceptional and that they were able to not just have a really perfect deck, but they told a story that uh the that resonates and they were like really memorable. Uh and part of what made it memorable is that this is the best team in the world to go out and execute this thing. And so people will bet on uh the

[19:58] jockey before they can even see the horse for uh it's obvious that this is a market that can exist in the future. They just know uh that this founder is going to run through walls and this this team is exceptional. Um and that's very true at the earlier stages. Later on when there's more validated about the the size and growth rate of the market then it becomes like clear that the the horse is so important and and the market is there. But what I tell every founder is that they can describe the the story and that's the first part of the funding framework in in the in the uh fence of you know this is something that's happening and the world is going to be different and we're we're the best people to make that real. A lot of founders separate their GTM motion from their fundraising strategy. Why is that a mistake? your GTM motion has to help you hit certain um thresholds and get certain results that make you default investable. So I I ask people like at the next like stage to be

[21:06] investable what do you need to have accomplished? You need to have be at and and some people will have an idea based on um things they can infer. Oh, we need to be at this level of sales or I think we need to have released our beta product or something like that. But in fact, like if you have a GTM motion that is never going to catch up, then you're going to be buy behind and you're not default investable. So that's why the GTM motion matters for for investors. and your fundraising strategy is, hey, I'm going to raise money for the next 18 to 24 months. And that's going to allow our go to market motion to be successful and allow us to reach what we said we're going to do uh today and to have a really great story of explosive growth and be able to even exceed expectations so that we are able to work with our our pick of investors and raise the money that we need at the next stage. You built and run venture studios. What early signals tell you a company is fundable and repeatable? Yeah. Uh so with a a venture studio or venture

[22:16] builder uh for folks that may not be familiar, it's essentially a a company or startup uh even that builds other startups. And in those cases, you're trying to uh approach it from from two directions, either thesis or founder. Uh and what tells you that you got something that might uh be working is that there is just like very high uh founder founder market fit and founder channel fit specifically. And so there are three different three or four different ways you could distinguish yourself. It could be data design development or distribution. I think that last one distribution matters a lot right now. And so I'm really looking for some kind of pipeline that tells me this stands out from what we thought was possible. And that pipeline uh indication says like yes, there should be more support investment or uh something like that. What advice do you have for founders raising outside major hubs like SF or New York City? Yeah, it's it's very hard considering, you know, you look at the data and it says you know the majority of funding let's say in the US is within one of these two hubs SF4 or New York and I I think there

[23:29] are a couple approaches one is to start spending more time in one of those areas and particularly with the investors with whom you know there is uh a lot of let's say vertical or sector focus and they understand maybe it's in in fintech or in climate or something else that there are going to be products built in these other places that that are close to customers or take advantage of university or large research institutions talent and and proximity. So when you have uh the ability to spend time there and and network with those investors then you start getting access even if you're not based there. There are however groups of angels and sometimes uh regional or or local investors who are extremely helpful and want to see you succeed there. And so if you're very early in your journey, don't overlook those folks and what they can do. They may need more education or more time building the relationship as I like to think about as as we've talked about already in order to perhaps get there if maybe they're not familiar with your

[24:36] space. But there are sophisticated investors everywhere. Um there are also unsophisticated investors everywhere. So again, building a trustbased relationship with those individuals early on so they see your progress is where you develop a local foundation perhaps before you are ready to raise money uh in some of these other major hubs. I get this question from founders all the time that live abroad, say in Turkey or India or some some part of the world where there isn't as much VC money or as much innovation going on. And I just tell them reach out to people just send them cold emails, right? Like one of the things I noticed in the Bay Area was people are really open to mentorship. You know, a lot of people have come there with nothing and have gotten really successful. So I think naturally they want to just kind of help the next generation to to do things and and to figure it out and through sharing their wisdom. So one of the things I used to do is just reach out to 10 CMOs every week saying, "Hey, I'm new to this city. I'm trying to learn. I'm trying to figure things out. Do you have, you know, 15 20 minutes to grab a coffee?" at the time I used to meet them at um

[25:49] the LinkedIn uh in downtown or open open coffee shop. May maybe you've met some founders there yourself over the years. Yeah, you know there are various ways to do this. First of all, a warm introduction is always going to get a higher open rate and a higher uh response rate, right? So I don't want to discount that. But I think what you pointed out was not um I'm Rick. time you in time I need something from you. It's like I really appreciate that you've accomplished X or that you wrote Y or that you know you and I share Z in common. Right? You're asking to develop a relationship with that person as opposed to just extracting something from them. And if you reduce the friction then to meetings saying like hey I'm also downtown you know let's let's get coffee at at you know this location you know you you again make it easy to say yes simple concept seldomly implemented and then thirdly I think the other thing is and this is for people who are not necessarily based uh here is

[26:58] create like some uh some model of scarcity which is I'm in town for this conference or I'm going to be here next week or something like that. You're somebody I really wanted to connect with while I'm here. And here's why. And again, referencing the the things you either have in common or respect or appreciate or admire about somebody. 100% of people will not say yes, but some percentage of people will will resonate with what you said and and that will be You talk about rhythm, alignment, and energy as core parts of leadership. What do most CEOs get wrong about managing themselves? Yeah. So the the alignment is uh is is important because you know we usually think of alignment in terms of like business alignment you know um marketing planned this and then um engineering launched something uh and then uh you know something else was recorded finance team you know like there how the business fits together and the things we're going to do and when we're going to do them that has to also like work in how you configure your life and I've noticed companies have a certain rhythm and When people have a certain like rhythm in

[28:06] their lives when things are going well, it's because you're living in a way that's consistent with your values. If you're not, then you're you're there's an there's a invisible struggle and an unspoken struggle in your company and with you. And the relationships in your life, if they're either broken or they are struggling in some way, and you're not allocating your time and and energy in a way that frankly you deserve and others deserve better from you. And so that's what what it looks like to really have a a purposeful intention uh intentional and aligned life because there are otherwise things that are going to be you know interfere with your performance. That is the gap between your potential and where you are right now. Yeah. I want to say if you have internal conflict you can't be clear and intentional when leading people because your brain's not clear to start with. Right. Yeah. And that and that's where once you have that clarity once once you have that rhythm then you feel good the confidence just shines. When I see it in people who have found that rhythm it's not easy and it's it's unreasonable for

[29:15] people to to think they can do it by themselves. And that's why your relationships matter a lot. your life partner, the coach, therapist, uh the the adviserss and mentors and people who are adding so much value to your to your life um have to play an important role in that too. And for earlier or for founders at earlier stages of their career, I feel like these components are often overlooked because there's such an is there's so much in a rush to just build deliver, you know, get bigger, get get traction, gain distribution that even if they haven't resolved some of their internal conflict or have issues in their life, they try to kind of push that out and double down on the business. But the thing is this the boat will start leaking at some point because the leader the the captain of the ship has internal drama. So at some point it's going to break out and it's going to negatively impact the crew. Well said. So when a founder comes to you overwhelmed, where do you begin? I usually ask them to tell me uh about

[30:22] what their week looks like and we actually look at their calendar. Um and I and I think that often presents a lot of clues. And then there's usually some things that present certain like triggers for this this feeling of overwhelm. The other thing is I ask them what they should stop doing and in order to create space for the good things in their life to uh allow them to apply their energy in places where they they feel like I I to do this but I'm not doing it right now. Um and sometimes you know that starts with a simple question like if I gave you a 25th hour in the day what would you use it for? you know because you know there's usually something missing and that could be sleep that could be exercise that could be eating right that could be you know that they're they haven't planned much for the future or they they haven't taken care of something in the business or in their own lives that they need to and you know it's not the job of your board member or your VC uh to know that your co-founder is dealing with their own stuff only you can do this for yourself and for a younger founder and And some older founders too, right? They

[31:30] they believe I can handle this. I can sweep this under the rug. I can just like put this aside and just like do work. Um when you have to work on yourself as well and that is so important because particularly at the early stages you are the single largest point of failure in the company. You talked about Yeah. the the captain of the ship. You're like it's not like any other individual but but you. So, of course, you have to do what you can to be at that that highest level of performance and create the the right rhythm for yourself and for the business. Yeah. And without the right habits, like you could maybe win the sprint, but I don't see you winning the marathon. It's almost impossible the more I think about it because at some point you you just won't be able to compete. It'll wear you down. And that's why I think having good habits become so crucial to that alignment, to that rhythm, to that flow, to that good leadership. I want to ask you, VJ, what's something you had to unlearn in your own founder journey before becoming a coach? We alluded to this before, but

[32:38] I think important is that people value very different things. And so if I'm working with a a coachy or or coaching client, what's important is to understand their values and what they're really trying to accomplish. I have founders who want to one day be in the pantheon of of of startup or business leaders um and be a household name. And I have other clients who are really trying to create what feels like a great life for them and their families. And I don't think of any of them as better or worse or more worthy or more ambitious or whatever because all of that is hard and the question is is that what matters to you and do you and and and have you unpacked that that uh so you know I I I think that is like one of the things that I've had to learn is you know you have people's like different and to work on a shared understanding of success together because you, the founder, are the deliverable. It's not a PowerPoint report that says your business needs to

[33:45] do this in the next, you know, 6 months. It's it's in it is instead like a better you that allows you to be be the best version of yourself. I want to move on to the lightning round. One question every founder should ask their investor, but usually doesn't. How can you help us beyond just providing capital? Most underrated fundraising skill, the ability to listen and not just pitch at the investor based on a dialogue and their feedback. One common GTM mistake you still see too often, failing to align the GTM strategy with the overall like business model and investor expectations for the next level of funding for the business. Book, mindset, or habit you most often recommend to the founders you coach? A book is Never Split the Difference by um Chris Voss. It's it's extremely useful and practical for for anyone, not just for founders. And actually, if I can sneak in the second book, it would be How would you measure your life by uh Clayton Christensen VJ that was one of the most grounded and tactical conversations we've had. Practical insights for any founder who's scaling

[34:56] themselves as they scale their company. For anyone navigating a raise, feeling stuck, or simply trying to lead more effectively, go check out the funding framework and learn more about VJ's work at mystartupsystem.com. If this episode helped you, send it to a founder you respect and I'll see you in the next one. Tech founders and VCs careers lessons GTM