Sramana Mitra: It sounds like you switched from that open-source based services company to a product company. That product company is SignalWire?
Anthony Minessale: Yes.
Sramana Mitra: Did you build SignalWire entirely by bootstrapping with services or did you raise money?
Anthony Minessale: It was a combination. I started SignalWire along with two co-founders. We raised money from the Valley in conjunction with the acquisition of our old services company so that revenue stream can contribute capital as we bootstrap.
Sramana Mitra: Let’s get more specific. How much revenue was in the consulting company when you went out to raise money?
Anthony Minessale: Close to $2.5 million.
Sramana Mitra: The product you were pitching to investors to raise money for was already in place?
Anthony Minessale: Yes. I did a little investigation in the Valley. I learned the landscape of this industry and the community there. I made a lot of contacts. In fact, I ended up with a term sheet in my first two weeks there, which I declined. I decided that I wanted to get more educated before I jumped in.
I mitigated that by going the angel route. I had several mentors from past employment. I decided to do a convertible note for the first phase. I went to various angels from my past. I just went through my network. There were some independent investors from the Valley that wanted to get involved. We ended up raising $3 million.
Sramana Mitra: When you were raising this $3 million, was the product already in place?
Anthony Minessale: We built the product as we were doing it. We didn’t wait until we got money to do it because we had some of the initial money. We incubated it at first and built the first functionality.
Our company is fully distributed. We have people in 15 states in the US and 11 countries. I developed everything I’ve done in my life from wherever I happen to be at that time. No matter where I am, I’m able to work. During the time we were doing the angel, we were on alpha phase.
Sramana Mitra: But you raised money with customer validation.
Anthony Minessale: Yes. Our reputation precedes us by creating the most powerful open-source telecom stack. A lot of them realized that a lot of companies are using our software stack. Most of the people in our circles were quite popular for that. We had validated technology and the customer use cases never stopped. The industry is still new.
Sramana Mitra: After that $3 million round, what happened next?
Anthony Minessale: We raised $3 million over time. It was a period of eight months or so. I’m a conservative when it comes to how to deploy capital. I made sure that I had a year of runway. We raised Series A in May 2019. I had maintained relationships with all the different investors.
We decided that it was time to find some partners to help us scale and take things to this level so we can grow the company. We were feeling the need to. I put together a $9 million round led by Storm Ventures and a few of the angels. That was completed by August of 2019.
Since then, we’ve been continually scaling our company. building our process more, reducing the number of jobs that individuals have to do, and spreading it out amongst dedicated workers.