Dotloop founder recounts building the document management startup from a law school problem into a company that raised $4M from angels, hit profitability, and sold to Zillow. He worked with Spencer Rascoff, Lloyd Frink, and Rich Barton at Zillow, and credits the acquisition with helping him achieve Dotloop's mission while learning lessons he applies today at Pacaso.
Chapters
going back to Dotloop though, you know, could you walk us through, you know, your experience maybe from like a high level and then, you know, what led to the acquisition by Zillow?
Yeah, absolutely. So, you know, as I mentioned, it was a business that was born out of frustration, a personal frustration or personal problem that I was experiencing firsthand. And that's one of, in my opinion, kind of the most important things for company creation is that the founder or founding team is focused on a problem that they're really passionate about. And that they really understand. So this was a problem that I really understood. And, but what I didn't understand is anything about building a business. I didn't know anything about fundraising. I didn't know anything about writing a business plan. You know, I was actually in law school at the time. I went to law school after undergrad, and I kind of just knew that I wanted to go solve this problem. And I started reading books and just asking questions of people who were around me and kind of figured it out. And the way that I raised money for the first company was pretty unconventional. I basically went to a bunch of angel investors who had never invested in a tech company before. They were just like people that I had met, like employers or professors at college, And I kind of raised $4 million, about $50,000 to $100,000 at a time with a bunch of small angel checks. And that was enough to get the business through the first couple of years. We actually became profitable on that $4 million of angel capital that we raised. And, but I found us like, it felt like we were hitting a wall. Like I just, I wasn't able to attract enough of the right people that I needed to kind of take the business to the next level. I wasn't able to really get to larger amounts of capital because of the way that I went about raising capital. And I kept hearing people talk about Silicon Valley. So I got on a plane, I flew out to San Francisco, you know, started knocking on doors on Sand Hill Road and ended up connecting with a really great man named Noel Fenton, who was founding partner of Trinity Ventures. Noel invested in our Series A. And we opened up an office in San Francisco at the time and kind of the rest was sort of history from there. In terms of how Zillow happened, you know, I never wanted to sell the company. I always viewed selling a company as a failure. And I think the reason why is because I had a vision for Dotloop that we could be, you know, a huge independent business that would kind of live on, you know, by itself in a big way. But we kind of reached a point, sort of like that first stage I described earlier, you know, when I got on the plane and went to San Francisco, we just reached a point where it was, it wasn't clear how we were going to get the business to the next level. We were, we had achieved a lot of market share, but really didn't have the right monetization strategy to turn it into billions of dollars of market cap. And I really connected with the people at Zillow, one of which was Spencer Raskoff, who's now my co-founder at Pacaso, but also Lloyd Frink and Rich Barton and a handful of the other people there that I got to know. And we found a lot of synergy around the cultures of the company, the missions of the company. Our mission really fit in nicely to Zillow's broader mission. And ultimately I reached the conclusion that by being part of Zillow, We would have a higher probability of achieving our mission at Dotloop. So what started out as a business development conversation turned into an M&A conversation, and it ended up being a really great decision. And not only was it great for Dotloop to be part of Zillow, but it was also really great for me personally. I learned a lot from that organization and from the people of that organization that I think is benefiting me now at Pacaso.
