Bootstrap First, Raise Money Later from Houston: Onit CEO Eric Elfman (Part 7)

Sramana Mitra: Was it an all cash acquisition, cash in stock, or pure stock?

Eric Elfman: I’d like to think that we did what K1 did for us. It was a mix of cash and stock. I needed their founders on board. 

Sramana Mitra: What is COVID doing to you?

Bootstrap First, Raise Money Later from Houston: Onit CEO Eric Elfman (Part 6)

Sramana Mitra: You did a private equity deal in 2018 with the $16 million trajectory?

Eric Elfman: Yes. We did that deal in November of 2018. We were at about $14 million when they closed, but we had a clear sight to $16 million by the end of the year. 

Best of Bootstrapping: Bootstrapping a Marketplace from Brazil

Diego Gomes, CEO of Rock Content, has built a terrific content marketing company from Brazil. He bootstrapped first, raised money later, and has recently acquired a sizable US company to scale. Excellent story!

Sramana Mitra: Let’s start at the beginning of your journey. Tell me about your background. Where are you from? Where were you raised?

Diego Gomes: I am from Brazil. I lived most of my life in Belo Horizonte. I started our company Rock Content around seven years ago with two co-founders, Edmar Ferreira and Vitor Pecanha.

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Bootstrap First, Raise Money Later from Houston: Onit CEO Eric Elfman (Part 5)

Sramana Mitra: You went straight to legal again?

Eric Elfman: It was about who we knew. Not only did we go back to legal but we also ended up configuring a solution for the same problem that our first company addressed. We realized that despite our last company being one of the dominant players in the space, the technology was 15 years old.

Bootstrap First, Raise Money Later from Houston: Onit CEO Eric Elfman (Part 4)

Sramana Mitra: Did you bring in an outside CEO or did you promote somebody from the inside?

Eric Elfman: I had hired a COO who became the CEO. 

Sramana Mitra: Was that the person who sold to the company that had already been a strategic investor? The exit path was already laid out? You just build longer and sell it at a higher price. 

Bootstrap First, Raise Money Later from Houston: Onit CEO Eric Elfman (Part 3)

Eric Elfman: There was a pretty rich population of angels that if you had the patience and time, you could touch. 

Sramana Mitra: Were these Houston angels?

Eric Elfman: The majority were, but we eventually stretched out to Louisiana, a little bit in California, and even in the UK. It started with people in Houston. They had friends that wanted to get in on it, so it got wider.

Bootstrap First, Raise Money Later from Houston: Onit CEO Eric Elfman (Part 2)

Eric Elfman: The data search idea was to remove the paper invoice system and switch to electronic invoices directly from the law firms and run them against the rules and validate them. The result of that was a 5% to 10% savings on the money they were spending with the law firms just by enforcing guidelines that were already set.

Bootstrap First, Raise Money Later from Houston: Onit CEO Eric Elfman (Part 1)

Eric has built two sizable companies in legal tech from Houston. Great journey!

Sramana Mitra: Let’s start at the beginning of your journey. Where are you from? Where were you born and raised? What kind of background did you have?