Entrepreneurship in Heavy-Duty Technology: Digital Asset CEO Yuval Rooz (Part 5)

Sramana Mitra: At this point, did you have outside financing? What is happening on the financing side?

Yuval Rooz: We only raised funding from some of the early investors and friends and family. 

Sramana Mitra: How much money was in the company?

Yuval Rooz: I think in the early days we brought in $2 million to $3 million.

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?

Entrepreneurship in Heavy-Duty Technology: Digital Asset CEO Yuval Rooz (Part 4)

Yuval Rooz: For the past five years, we’ve been developing an open-source language just to describe the interconnected application. The second component of our product is compatibility. When you want to run these applications, there are all kinds of technologies that you can run it on.

Let’s take the analogy of Java language. You can use Java in different databases. You just need to install a driver depending on which database you use. We have similarly developed all these drivers to our language for different technologies out there.

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. 

Entrepreneurship in Heavy-Duty Technology: Digital Asset CEO Yuval Rooz (Part 3)

Sramana Mitra: Let’s talk about how you got the company off the ground. What were the first few steps? What was the concept, genesis, and the concept of validation? 

Yuval Rooz: Not only was this a very nascent technology, but it was also associated with cryptocurrency and Blockchain. There was also some negativity in the early days associated with the technology. The early days were hard in the sense that having conversations with potential clients was a challenge.

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.

Entrepreneurship in Heavy-Duty Technology: Digital Asset CEO Yuval Rooz (Part 2)

Yuval Rooz: I landed at DRW, a trading company based out of Chicago. I quickly fell in love with the company because it was an entrepreneurial company. The owner, Don Wilson, allowed the employees to explore new ideas as long as those ideas were aligned with what the company does. I enjoyed that environment.

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.