How Rho Raised Millions and Built a Winning Team

Other challenges that you face along the way, because like you're going from investment banker working crazy hours in that I'm sure to probably startup founder working crazy hours, and in the middle of all of that it's like figuring out one thing after another from like hiring to product to whatever all these different things. What have been like the biggest challenges for you as you've built this company last seven-ish years?

I think learning how to be really good at hiring was something I definitely had to learn. I think early on. when I was starting Ro, someone told me, you know, nobody's actually that good at hiring, and 60% hit rate is about as good as you can get.

Yeah.

And I sort of took that at face value, and I think that was probably— that was wrong. I disagree with that now.

What do you mean? What do you think?

I think you can be really good at hiring. I think you— you know, I think it's a process, and I think it's pretty straightforward. Doesn't mean it's easy. You need to build a great employer brand. First, you need to build a great culture. You need to build a great employer brand. And then you need to be really deliberate, really clear about what is the job, what are the roles of this person trying to solve for. And then I think you need to be really not looking for the all-around great, but looking— or all-around good, right? But looking for, okay, where is this one person, this one task, is this person great? And this is the main thing that I'm trying to fill. This is the— I want this job done really well.

Yeah.

This job, not everything. As you start, you get— you start a company, you start with more generalists. You trend towards more specialists over time. The other thing I think I learned was that stage fit really matters a lot from hiring. So folks that have been at a company at a similar stage as you generally understand more about how another company in that stage would operate than, say, someone that's been in the same industry as you, But at a company that is like a large public company, let's say. So we're in fintech. Generally speaking, folks that have worked in commercial banking may not be a great fit for Ro. Sometimes they are. And we have some amazing people that work there. So we definitely look at every applicant. But from a percentage basis, our hit rate would be higher with someone else that was at a Series B startup that— or C startup that may not be exactly in this space. Just the time to ramp, the time to learning is much faster, at least we've experienced. Again, there's talent everywhere, and there's no one place. And we have a phenomenal recruiting team that looks for people everywhere. But those were learnings that I think that I experienced.

I was just talking to a couple of engineers at a Series B company last night in New York here. And they were saying— and so they are remote. And they were saying they'd have to make 30% to 40% more to be in office I think it was like four days a week because I was trying to get it in their heads. Like, what are they thinking about with that? How do you look at hiring remote versus in person? Just what do you think about in terms of that?

So I think it depends. You know, there's it's very self-selecting. I think there's some people that that feel that way, and there are companies that are set up well to support folks like that. My view is the opposite. I want people that want to be in office. You would have to pay me like double, you know, to not be able to be in office with other people. Like I find like being you know being alone in my apartment trying to work, trying to look. at a, you know, 13-inch screen as my interaction with other humans.

Yeah.

You know, really unfulfilling and also, like, pretty slow as a decision-making process. So—

Yeah.

We're very big on in-person. We want other people to feel that way as well. It's not for everybody. I completely understand that and respect that there are, you know, many ways to do things. But for us, the only way that I know how to move really fast is put everybody in the same room and get them on the same page really quickly. That way we can all kind of sync, you know, make decisions quickly and move fast. I sit on the floor. We have— Our offices are set up like trading floors. So it's one big room. I'm sort of in the middle of it. And anybody can walk up to me, ask me a question, or my leadership team is sort of right there next to me. And that allows, I think, number one, it reinforces our culture of transparency. And number two, it means that our teams work really well together because you kind of have to. You're 10 feet away from the next person. You're 20 feet away from the next person. Whereas if you're remote, I think it's a lot harder. It's a lot— and you have to put a lot more effort. We have some— we have a handful of folks at Row that are remote because They are exceptional talent that, frankly, we just can't find in the New York area, or they're in a market that we're in. And so we're not absolute about it, but we have to work really hard, and those folks have to work really hard to make sure that they're on the same page in a way where if you're just in the same room as people, it happens almost naturally and subconsciously.

Yeah. No, there's so many debates on that, right? In-person versus remote. Like, OK, we're in-person, but how many days in-person? I have an engineering friend who's like, He's 4-ish days like in person and it's a whole thing like, but like the company is really good. So he loves that. So many different opinions on it. There's no right answer. It's just like what fits for your company.

And like, we want, you know, we want to build a culture and a team and a place of work where people are really excited to be there and they want to be there every day. Yeah.

And that's— well, and also for you, like you grew through community, like through events in person. I can't imagine, I can imagine like if you did that growth and then you just didn't have an in-office culture, it'd be very strange to be like, we love in-person, we love and then we're remote. We never see each other. It would just be odd.

Yeah. So again, that may just be me.

It works.

But that's, you know, that's how I know how to do this.

Yeah. And one thing we had to talk about, 'cause you've raised a bunch of money, is like, you, again, you're in finance, so a little bit different in terms of you in that world kind of, but like, in terms of raising capital, you hadn't raised money for a venture-backed company before.

No.

So like, take me through that in terms of what's helpful. I'm thinking about my listeners and people who are gonna watch this, like, who haven't raised capital before. Like, what was helpful for you in that process? Even going from the early stages to then you have metrics and you have growth, it's a little bit different. Take me through that fundraising process for you and Ro. I guess starting with the first one, maybe.

Yeah, sure. Each stage is really different. And at each stage, investors are looking for different things. At seed stage, they're looking for an idea. They're looking for a team. They understand that there's at least a medium probability that idea may shift. So it's more about a market direction, and are you able to get the right team around you? Are you a magnetic personality? Do you believe that people will follow you? Do you have— enough technical capability, either in yourself or with a co-founder, where you're able to ultimately make that thing a reality? Do you have a clear vision for what you're going to bring into the world, right?

Yeah.

That's pretty much what seed investors are looking for, at least from my experience. Series A, you want to be able to deliver on traction. You want to be able to show, yes, this is working. You want to be able to demonstrate some revenue. You want to be able to demonstrate that you've built more of a team. Series B, it's really all about growth. Like, how fast are you growing? And how efficient is that growth? Are you hockey-sticking, exploding off the page? If so, it'll be really easy. If not, it'll be hard. Series C, again, more growth. And then as you get later, it's more like unit economics, multiples on revenue, or multiples on gross profit, or multiples on net income ultimately in the very long run. I think that people underestimate a little bit how much of a relationship business VC is. It is a relatively small community. Relationships matter a tremendous amount. You know, being a you know a good participant of that community, right? Being thoughtful, respectful, you know, but also showing up in the way that you want investors to see you, right? Which is like yeah, like you want to you want to be persistent, you want to be focused, you want to be determined. You should expect that most of your answers are going to be no, right? Like statistically, like you only need one yes. So yeah, like just getting used to rejection, and then but being really passionate about your idea, and also like not asking the market or not asking investors for. Permission to build your company, right? And I think that's something that's really important, especially at the very early days when maybe you're raising seed capital and you don't necessarily have very much to show for it. Maybe, you know, maybe you have a prototype, maybe you have like an idea. It can be a trap to go to investors and ask them, well, what would you like to see? Or, you know, ask for permission. Like, I think you have to approach it with the mentality of this is happening, you know, I'm doing this, it's happening with or without you.

Regardless.

I would love you to be part of this journey with me. But, you know, if that's not going to, if that's not a fit, that's okay. I will make this happen. And that's something that I learned pretty early on, but I made that mistake, you know, at some of our very early first meetings. And it's an easy mistake to make again as a very early stage founder.