Sramana Mitra: Where did the $250,000 capital come from?
Tom Coburn: Our first investor was Dharmesh who’s the co-founder and CTO of HubSpot.
Sramana Mitra: I just spoke with Dharmesh this morning. You met Dharmesh through Highland?
Tom Coburn: No. We’re very thankful to Dharmesh for being our first investor. That spurred a lot of other people to invest. Our story of meeting Dharmesh is very funny. I saw that there was a marketing conference in Boston. They were doing a mini Shark Tank competition. Dharmesh was one of the judges. He agreed to invest on just seeing the pitch.
Sramana Mitra: That’s very interesting. Dharmesh generally doesn’t lead a round. Was it convertible debt?
Tom Coburn: Yes. On reading some of your content, I thought I was definitely one of the 99% of entrepreneurs out there trying to raise money way too early. I wouldn’t say that I had made it my full-time focus, but I have been out there having conversations for over a year before we happened to meet Dharmesh. By that point, the business was further along. We had some solid revenue. I definitely wasted a lot of time in the early days trying to raise money when we weren’t ready.
Sramana Mitra: I’m glad you acknowledged that. What did you pitch Dharmesh that caught his attention?
Tom Coburn: I know what we pitched Dharmesh. You’d have to ask him what caught his attention because I’m not sure. I’ll take a half-step back to explain how we got to Jebbit. What we do today is a software platform where marketers can create interactive experiences.
Think of a website quiz where you answer five questions and they find the right product for you. We built the software where, without touching a line of code, the marketer can easily build those and put it wherever they want. Behind that, we aggregate the answer. It’s very valuable first-party data. The initial idea, which you will see a connection to, was I was watching a TV show on Hulu and I ignored the video ads before the show.
I thought, “What if you could put a question on that ad and pay people money to answer the question proving that they paid attention to the ad?” It wasn’t about gathering data from consumers; it was about you watching a car commercial and we ask you how many miles per gallon are in that car. We only charge the advertiser if you get the right answer. That was the original idea.
We realized that we were way above our skills to create that product. You had to integrate with ad servers. You had to deal with fraud. The idea that we launched first and did a couple of hundred thousand dollars in revenue was a website exclusively for college students.
It was our own property. Students could log in. We would connect them with brands that were interested in them. They can go through a couple of challenges and quizzes where they would learn about the brand and the brand can learn about them. They would then get paid cash for doing so. All that just happened on our website for college kids, which made it simpler.