Wow. This is awesome that I'm here.
It's been a very hard road,
and I honestly never thought I would even get to this point.
My dad's the best business partner,
and when I use my app, I feel proud that I made the idea.
To me, the success of this app would just validate
everything I've been working so hard for.
What makes it special in my eyes
is that beautiful combination of heart and passion and brains.
It's watching people from all backgrounds
thinking about an idea, honing it, combining it with passion
and bringing it to life.
That, to me, is the essence of the American dream.
You have four advisors down there.
It's about making sure they understand how passionate you are.
You have 60 seconds on the escalator
to get them to choose to be a part of your project.
You'll know because at the end of your escalator ride,
they'll either go green or red.
If you get four reds, you go home.
But if you have at least one green,
you'll get to continue your pitch
and tell the story of your app,
in the hopes of partnering with one of the advisors.
If that happens,
you'll spend the next six weeks honing your app
for a chance to earn a share of over ten million dollars
in venture capital investment
and featured placement on the App Store.
All right. Everybody set?
All right, all right, all right.
Y'all good? Good to go. Let's do this thing.
-Violet. Hi. -Hi.
-Zane. Nice to meet you. -Hi.
-Hey. Good to see you. -How are you, John?
-Cool. -Good, yeah.
What a great day. Daddy-daughter day.
Violet, let's start with you.
This was your idea, the idea of this.
Pop I. Where did it come from?
My name is Violet.
This is my dad, John.
And my app is Pop I.
I'm a little nervous, but I'm not that nervous,
'cause I know that my dad's got my back.
One of the most important things is to show my daughter
that you can come up with an idea
and actually go out and do something about it.
And give her the confidence as a woman--
feel like she can do anything.
Really nervous.
4, 3, 2, 1, doors.
Hey, everyone.
One year ago, I had a backpack,
and I took that backpack every single day to school.
But then I wanted to have another backpack,
just not having one picture.
And so I told my dad my idea.
And he said, "Let's do it."
When Violet told me about her idea,
I was super excited to use my technology background
to build an app that would allow her to deliver pictures, words, designs,
whatever content she wants, in real time, to her backpack.
Our hope is that with this kind of platform,
we can actually encourage kids to have more social interaction
when they express themselves,
rather than just expressing themselves in the digital world.
All right, guys. Please come down here
and talk to us about what you got.
All right. You wanna show 'em some things you can do with your backpack?
-Here. Take this off. -Okay.
Wanna show 'em a picture of your best friend?
The hand.
It's me and my best friend at school.
Can you draw something and deliver it to the backpack?
-Okay. I'm changing to a "yes." -Gwen, you swiped "no"?
Very cool.
I change pictures every day when I go to school.
And what do your friends think of it?
They want one.
How old are you?
Eight.
You're the youngest entrepreneur I've ever met.
Is this-- That's not E Ink, is it?
This is electrophoretic technology, yeah.
Where are you manufacturing these screens?
These are from Taiwan.
They have to vacuum-deposit the transistor backplane on glass,
and then transfer print it to plastic, so it's not as good as glass.
But there's no reason why this screen technology
doesn't come down to tens of dollars, you know, with some volumes.
How much does it cost?
-$1,000. -I'm sorry?
This backpack cost a thousand dollars for one prototype.
The, uh-- At scale--
I like her salesmanship.
-Yeah. -Go for the big number.
So it's all a scale issue. So right now,
we'll go to market with a large display that sells for 199,
a much smaller display that sells for 129,
and then as volume picks up,
we'll be able to dramatically reduce the price,
and hopefully be just a slight premium to a traditional backpack.
And we're thinking a lot about content. We want to be iTunes.
So she wants to put branded Disney content.
So every time someone's clicking content,
-it's 99 cents or $1.29. -I get it.
Aggregating all that content into one database--
Yeah. Once you get scale, it's a monster business.
-Yeah. -Which is why Apple itself,
Google, Amazon,
and a lot of consumer packaged goods companies are flirting with this as well.
-I assume you know that, right? -Sure. Absolutely.
So what makes us confident that even with our great mentorship,
we can help you get to that next level?
It's like any start-up. We're gonna have to go faster
and... get out in the market as quickly as we can.
Have you raised money so far?
Yeah, we've raised money from family and friends, so it's--
How much have you raised?
Uh, 900,000 has gone in.
And just to make these prototypes?
It was to build the app, make the prototypes,
and then a lot of development actually on the board.
How much are you guys trying to raise?
To do this properly and to get real scale in the market,
-it's gonna need a fair amount of capital. -Tens of millions of dollars?
I think it'll need five to ten million to give it a real shot--
I think you're probably gonna need-- You're underestimating that.
-So-- -Yeah. Maybe more.
My only fear is in a couple of hot months,
you're gonna see backpacks and bags with screens on them.
-These companies have billions of dollars. -Yeah.
My heart is breaking, 'cause I have to say--
In front of your daughter, it'll feel really weird.
So I'm gonna close my eyes and go...
My daughters-- I have a five-year-old and an eight-year-old.
Last year they had a backpack where they--
It was magnetic,
and you could also slide in photos.
And they were super into this product
for, like, three weeks.
And then they moved on to the next thing.
I know how hard it is to keep their attention.
Um-- So that's why I'm out.
Um--
To Will's point, companies that are beyond well-capitalised
are gonna be able to build it faster,
leaving you in a bad position.
Unfortunately, I'm gonna switch back to a "no."
-All right. -Thank you guys so much.
-Thank you. -Hey, thank you guys.
-Good luck. -What do you say?
-Thank you. -You're welcome. Good luck.
I hate when we all say "no."
Daddy, they didn't pick us.
Coming in doors.
-Hey. -Did you enjoy it?
Oh, yeah. It was awesome.
To see her learning to be an entrepreneur and take risk.
Just go out and get it done at an early age. That's--
-You've already started. -That's a great experience, right?
And then when you hit a roadblock, which there's gonna be lots,
you just get up and keep going and make it work.
You wanna go back to the hotel and go swimming?
Have a swim?
I don't blame you. Come on. Let's get out of here.
-All right. -All right.
All right, guys. Stepping out. Standing by.
Doing some last-minute preparation for your pitch?
Yeah. Definitely.
So let's talk about your app, about Dote.
What are some of the unique challenges you've been through personally
while trying to get Dote off the ground?
Because it must be so time consuming.
Oh, my gosh. When you start something,
it's just you and your computer and your phone.
And, you know, no one believes in you. No one's with you.
No one is, you know, helping you.
And you have to believe in yourself so much every single day,
that it can be really, really hard.
And there have been moments when you just wanted to pack it in?
Totally. I actually have a playlist called "Lolo Pumps Up."
That's--
My name is Lauren Farley, and I am the co-founder and CEO of Dote Shopping.
I grew up in Anchorage, Alaska.
There aren't start-ups in Alaska. There's not tech in Alaska.
I've always loved to buy clothing,
and I've always bought a lot online,
think because I was used to catalogue shopping in Alaska.
Initially, I was really scared, like, leaving your job to,
you know, have no income.
It's kind of terrifying.
But I just kept thinking about it,
just couldn't let it go.
So this is a crazy adventure.
Online shopping is a 70 billion dollar industry.
But nobody wants to download 20 different apps
for every single store they want to shop at.
People want to be able to shop from their phone.
Dote is a mall in your pocket.
You can shop from Urban Outfitters, Sephora, Adidas,
and over 130 other top brands right from our app.
And we make all of their products one-tap shoppable.
Everything that I'm wearing, I got on Dote.
-Wow. -We already have over 100,000 active users
and are on a path to mobile commerce dominance.
This is a once-in-a-lifetime idea.
And we want one of you to come along for the ride.
You are saved by Gwyneth.
Come on down and tell us about your app.
This is Dote.
I used to work on games for the iPhone.
-So you're gaming shopping. -Gaming shopping.
-Nice. -Exactly.
And how are you different from ShopBop,
Revolve, Net-a-Porter?
We're kind of like a mall. So we work with mainstream brands.
Brands that sort of the everyday person shops from.
Brands that you'd find in a mall.
Plus, really importantly, we have the in-app checkout.
Okay. So I want to go to American Apparel.
-Okay. -Show me that.
So here you can browse
everything that they have on their website.
-Okay. -And if you see something you like--
I want the bodysuit.
All right. Cool.
So you can see multiple photos--
So I want to buy it.
-Sure. -In black.
-What size are you? -Uh-- Small.
-Oh, in black. -Now I'm buying it.
And that's it. It'll be sent to you.
Oh. So it doesn't take you to their site.
So users only have to enter their credit card one time,
and then they can buy across all the different stores.
And that's our proprietary technology,
and it's actually really, really difficult to build.
It takes you to the experience with their content--
Yep.
So that's the difference between you and Net-a-Porter or...
And the conversion difference between sending someone out to a website--
-Uh-huh. -It's enormous.
It's literally ten times.
So what are you on Dote?
I'm the CEO, so I basically do
all kinds of different things that nobody wants to do.
Get the coffee.
When did you start it?
About two years ago.
This feels like a narrow demo you're going for.
I think for sure our early adopters have been the college students--
-So is she 22 to 30? -Yeah, totally.
-A mall, right? -A mall.
And those kids aren't going to the mall anymore.
-No, they are not. -They are totally not going to the mall.
They're on their phone.
Can you explain to me a little bit
about this proprietary technology that you created
and how it actually works?
So we basically take whatever is on their website
and structure it in our database
so that we're easily able to plug it into our UI.
And it migrates over how?
Yeah. So when a user places an order on Dote,
we pass that along to the retailer
using their e-commerce checkout on their desktop.
So the other really awesome thing about Dote
is it actually doesn't require retailers to technically integrate with us.
-Wow. -That's awesome.
It is.
So how many people are using Dote?
We have 100,000 active users.
Monthly, right? Monthly actives?
Yeah. Our monthly actives is more like 70k.
So how much money are you looking to raise,
and what are you looking for from an advisor?
We are looking to raise 500,000.
And what we really need help with is getting more retailer partnerships.
What's the revenue right now that you're--
Over 150k in GMV a month.
And the percentage you're taking off each transaction,
'cause that's obviously the business, right?
-Yeah. It's ten to 20%. -That's not bad.
-That's dope. -Yeah.
-That's Dote. -We don't have much costs, right?
We're just a bunch of developers in a room.
-And they're not holding any inventory. -Exactly.
And there's no supply chain, and the potential is limitless.
And they didn't have to buy real estate to be a mall.
You could very quickly build authority in all these different verticals--
-Yeah. -And you could go from low to high.
It's a great business.
-Can I ask a silly question? -Yeah.
And "Dote" means...
Like doting on someone, you know, like a doting father.
To kind of dote on yourself. 'Cause what I want people to feel
when they are on the app and make a purchase
is sort of they're taking care of themselves.
They're the best version of themselves,
which I think is the feeling I get
when I feel really good in my own skin.
You guys aren't looking to be acquired.
Are you guys trying to be the thing,
or are you guys looking to build it and sell?
No. We want to be the thing.
But what if Amazon offers a billion tomorrow?
Amazon hasn't gotten any traction with fashion,
no matter how much they try, no matter how much they push it.
It's just-- It doesn't work.
Unless they acquire this company.
Right. And which they should.
It would be smart of them to do.
But for example, my daughter's generation.
That generation is all over the place.
She switches loyalty so quickly.
-Yeah. -But here,
you get them right back to the top of the funnel,
especially if you start searching by a specific product.
I really love what I've seen.
And a lot of proprietary tech that you've developed around it is amazing.
Yup.
And, um, I think...
Um-- I think I can really help you.
I have relationships with tons of retailers.
And I can help you build it.
So if you want me as your partner, I'm in.
I want you as my partner!
Yes! Awesome!
Oh, my gosh.
-Congratulations. -Thank you so much.
-Congratulations. -So awesome. Thank you.
Very nice. Very nice, Gwen. That's a good get.
I love this. This is a good one.
-It's a good get. -Yeah.
Sunny. Hey.
-How you doing? -What's up, Zane?
You're a music fan as well, and you made music, and--
Yeah. I was in a band.
We played at the Roxy and the Troubadour here in LA.
Amazing. What was the name of your band?
-MASQ. -M-A-S-K?
But with a Q instead of a K.
Google killer.
My name is Ram Uppal. I go by Sunny.
And I used to be the lead singer of a band.
You try and save my soul
When you close my eyes
Around about the same time that I was making big changes in my life,
the ad from Code.org came out.
And all the tech CEOs were in it, and they were talking about,
"You should learn to code" and things like that. Okay, great.
And then at the end of it all, will.i.am shows up and says,
"Coders are today's rock stars.
That's it."
And I was like, "Oh, my God.
That's the best thing you could have possibly said
in that part of my life."
So I have to say, big thank you to him,
'cause this has been a real journey.
Here we go. In 3, 2, 1. Action.
Here's the problem. There are hundreds of ways to work out.
But at the end of the day, if you're not willing or motivated to work out,
you're just not gonna do it.
So that's what my app is.
What we've created is a 3D pet that lives on your watch.
But the catch is, the only way to take care of your pet
is by working out.
So if you're healthy, your pet's healthy.
And if you're not, it's not healthy either.
This is Tracks, your new fitness companion.
-Wow. -Step to the centre of the circle, Sunny.
Good job.
I like your whole philosophy.
I would like to see your app.
-Perfect. -Show us your app.
When you look at this app for the first time,
the main screen really shows you the pet that you have.
So it shows you its emotions. It shows you what it needs right now.
Once it tells you that you want to work out,
this is the main workout screen that you're gonna be having.
The greatest thing about this, I think,
is that this fitness companion really reacts to your workout.
It is a fitness companion. It's running while you're running.
It's walking while you're walking.
And it's sitting while you're stagnant.
-So this is watch UI, right? -This is a watch app. Yes.
Who's your core demo? Who do you want to reach?
Basically it's millennials and the younger generation--
Just because we have a different perspective
on what motivates us.
Is there a social component to this?
So you can see what your friends are-- how they're exercising?
That is something we were looking to expand on
after we presented this to an investor.
-Right. -And you guys are trying to raise what?
-One million dollars. -Okay.
How much money have you raised, how long has it been out,
and what kind of traction has it gotten?
Currently, I haven't been looking for an investment.
Basically, this app cost us nothing to make
because we made it ourselves.
And I really wanted to wait to put it out
so I could have a proper launch.
First of all, you're an incredibly talented man.
-I mean-- -Thank you.
It's amazing to hear.
I do think that if you figure out a really clever social aspect,
I think it could be incredibly successful.
But I don't feel like I have enough expertise in this realm
to help you from the mentor side.
I'm out.
Thank you.
Not because I don't believe in your idea,
but at this stage, I just feel like it's too new for me.
Thank you.
Here's my one concern,
and I want to work through it with you.
I actually don't think you realise what business you're in.
Yeah.
You're in the branding business, my friend.
If you came in here and said it was Freddy the Fox app,
and we were gonna build the next Mickey Mouse,
you would have had me completely in.
The problem is, you're completely commoditised,
there's a lot of people doing this thing,
and the skill for you to be successful
is making that fox America's fox.
And because you didn't bring that to the table, I'm out.
Okay.
So... this is to learn from what you're building
and how open you are to add things or guide it a different way.
The couple of things that it's missing is the social part.
I'm only gonna care about the fox
if the rest of my friends' foxes are healthy,
and if they can see my fox being healthy and keep me up with the Joneses.
Right.
I'm in...
-if you're flexible... -Sunny?
...if you're willing to take guidance.
'Cause I think you have a potential home run.
-Hey, Sunny? -Yes.
I actually think Will is right.
So, with that said--
Oh, now you're back in.
Well, Will, you're a smart man, and you're right.
This is the phase where we talk about
actually the mentorship to then-- to the pitch.
Yeah. You're right.
If you're open to allowing me
to use my marketing skill
to actually make the fox someone that America cares about.
'Cause I actually disagree with Will, who got me back in,
that it's a social thing.
-I actually think-- -No. I think it's a couple of things.
How can I have a virtual fox where I can then, like,
take pictures and put my fox on Instagram?
People care about their pets and take their pets for walks.
Sunny. Sunny. This is about making Freddy the Fox important to everybody.
From my standpoint, this is a no-brainer decision for you,
and I think you should go with me.
You wanna go for somebody that's not like a fair-weather friend.
-I've been green-- -For 13 seconds.
Sunny, he was on your side for 13 seconds longer than I was.
No, bro.
This is a branding game.
I'm the branding person for you.
-Really? -Yes, really.
Last time I knew, my brand is known all over the earth.
And if you're making an album, you should go with Will.
I've grown up with Will.
And I've watched tons of Gary's videos.
So...
I think I have made my decision.
And I'm going to go with Will.
'Cause I got gold shoes on!
Got the gold shoes, gold boots, baby.
Oh. Do the moonwalk.
-Thanks, Sunny. -Here we go.
-Congratulations. -Congratulations.
That's awesome. I'm pretty sad right now. I wanted that one.
Good job, Will.
Oh, man.
I was, like, "Wow. You got will.i.am." That's amazing.
Will was the one that put his hand in first.
I had to-- There was no turning back from there.
I don't know how many times you get this sort of opportunity,
and I'm gonna do my 100% best.
-Congratulations, man. -Thank you.
I'm pleased for you. That's great, man. Bright future.
-Thank you very much. -Thanks, Sunny.
All right.
-Oh, wow. -Thank you.
-Bye! -See you, guys.
Gwen, have a good weekend.
Once a developer partners with an advisor,
the hard work begins as they enter six weeks of incubation.
After we marry the developer with the advisor,
we get to see under the hood.
Is there an engine there, or a bunch of freaking Flintstone feet?
Tracks, the way it is now, I see infinite possibilities.
When I go to the gym,
there's people that I know there.
I'm like, "Yo, how many reps you do today?"
-And it motivates me. -Yeah.
If I can compete my fox with your fox, and I see you at the gym--
-Yeah. -And then after I enter the gym,
I'm like, "Yo, let's let our foxes battle."
Then I'm gonna work out so my fox kicks your fox's ass.
Yeah, yeah, yeah.
-Right. -Right on.
I think that'd be awesome to add that.
Yeah, no. That is really awesome.
I could not have asked for a better partner with Will.
But the minute I sat down and started showing him the app,
he already had new ideas.
My freaking fox battles Kanye's fox.
We record the battle.
Tracks should have access to my calendar.
Does a fox get armour?
Should have access to my Instagram.
Can I talk to my fox?
Uh, not yet. But that's really exciting, because Siri--
-No. I'm not talking about that. -Okay.
I want to talk to my fox.
So now we're gonna make the foxes battle
and be able to talk.
I want fox to talk to me.
One of the most challenging parts
of working with somebody who's already very successful
is it's hard to say "no"
when you're in a position where you really need their help.
When the foxes battle,
it should be scored.
Lauren arrives to Goop headquarters,
where Gwyneth has arranged a meeting with her executive team.
I think the biggest gap that we have right now
is what are our growth factors.
It just-- It's expensive, and we want something that's repeatable.
In Dote's case, it's really an issue of speed to market.
Can she get out ahead of the competition
and get the app out into the culture and get enough users
where brands will want to get on that platform.
In the research that I've done,
I can't find a competitor who does this the way you do it.
-Yeah. -And...
Every mom of a tween is gonna want to use that,
not only the tween.
One of the next steps for us
is to figure out how to kind of leverage the data we have
to create an experience that's relevant to a bunch of different verticals,
rather than just the teenage girl that's been the early adopter.
And especially it's sort of balancing how do we get--
pull in a more affluent, older demographic
without alienating your core demographic.
And all retailers, us included,
we are constantly balancing trying to find those points of integration.
Knowing your audience is everything.
If you're off-market to your customer,
you're gonna alienate your core demo.
And so I think we can help her come up with
some good strategies around marketing.
I feel like the themes,
we can be really specific by seasonality.
If you did a January theme, a February-- so, like, a Valentine's day gift guide...
I'm sure that would do so well.
We find we have incredible success,
the more context we can put around the product,
the more people just, like, buy.
They convert like crazy.
Especially in the world of e-com,
when everything's so ubiquitous.
It's, like, to really crystallise your point of view.
-Yeah. -And you can do that so easily
through content and edit.
-Yep. -And I think it could be really powerful.
It was really cool to see the executive team at Goop
delve into how much traction we are able to get with it
and how we can roll it out more to even more people.
It's really important, over the next few months,
that we continue the growth
and then also retain who we've gotten onto the platform.
-Can I ask a question? -Yeah.
With just three weeks till his Lightspeed pitch,
Sunny returns to update Will and the i.am+ team on his progress.
If there was, like, a marathon version of a hack-a-thon, this is it.
So it's on all the time.
-Is this the current fox? - This is the current fox.
This is an animation of him doing a simple jumping jack.
Look at that. You did this in one day?
Yeah. Like, some sort of simple armour.
We haven't painted it yet.
How about... I go for a walk.
And then the fox is able to smell certain areas.
So it says, "Stop here." Sends me a--
"Stop." So it'd be like-- I just want to mark my territory here.
Right?
It's like the original check-ins.
It's like a Foursquare check-in.
More ideas. Now I'm a little worried.
There's a lot of features being added here.
It's gonna add to the scope.
And I'm a little bit afraid that we won't be able to finish on time.
So... I love all the ideas.
-There's never... -A shortage of ideas.
...a shortage of ideas in this place.
I think-- So, like, when it comes to the scope of the project,
I think there might be some issues in terms of, like,
how much we can actually get done in time to show somebody.
So we really need to hone in on
what are we exactly gonna be doing in this whole process.
The biggest reason apps don't get finished is 'cause the scope is too big.
I'm seeing a lot of big ideas here,
and I'm just worried that maybe the scope might be reaching that limit.
So if we start to try to narrow down, simplify some of the ideas
to where it's feasible and can get done.
I'm passionate about Tracks.
I know there's gonna be pushbacks, like,
"No, that's not what we want to do."
Which is great. Not every idea has to be executed.
But why am I gonna waste all this time and energy
on Sunny and Tracks,
and all this excitement of ideas,
and it's up to the fate of the investor?
I said, "Let's change it all. Let's flip the freaking script."
When you came down the escalator and pitched,
my head was like, "Holy ****."
'Cause I can't help but see things.
-Right. -It's just how my mind's made.
You had an idea, like, "Did you know your idea points to this?"
You just build on it again and again.
What you don't want to do is put out something that's an incomplete thought
and then somebody finishes the thought.
Chat Roulette came out first.
And it was an incomplete thought.
-Mm-hmm. -And Snapchat completed it.
MySpace, incomplete thought.
Facebook completed it.
You want to make sure your thought's complete.
Right.
Will really wants to make sure that I understand him as a partner.
He's my teammate in this.
We're gonna be getting this app done in the best way possible.
I don't want to let him down at all. But I am worried.
Everything's sort of blurring the days together,
but I have to be ready.
Lauren returns to Goop,
having experienced her strongest quarter of sales yet.
In preparation for the pitch,
Gwyneth has Lauren meet with Sam Yagan, CEO of ShopRunner.
I thought it would be interesting for Sam Yagan to meet Lauren.
And I thought it would be helpful for him to kind of ask her some tough questions,
and to see where the holes are.
Because I want her to be prepared when she gets in front of the VC.
So one of the biggest challenges that I find with entrepreneurs
is their inability to clearly articulate
what their grand vision is for the company.
Like, why this company's gonna matter a decade from now.
So, why will Dote matter a decade from now?
I think that our big vision is to be the marketplace for branded products.
I think that these brands are really struggling.
They're kind of stuck between the mall dying
and Amazon, who's trying to beat them.
And they don't have anywhere to go on mobile.
Anyone can aggregate the retailers, fundamentally.
Wondermall has. Spring has.
-We have, in a different way. -Mm-hmm.
Which leads us to customer acquisition.
If you spend enough money, you can acquire the consumers.
And this was actually something that we saw a lot in online dating, right?
Is you would see people
who could build a platform, acquire a bunch of customers.
But that didn't mean they were ultimately gonna be the one that survived.
The reason I asked you some questions about the user experience is--
I kind of chuckled when you likened what you've built
to an old-school shopping mall.
-Mm-hmm. -Um--
My personal view is that's going the wrong way.
The idea that I have this immensely powerful object in my hand,
that I'm doing the shopping from,
and yet you want me to have the same shopping experience
that I had in the mall in the cornfield where I grew up,
where I would literally have to go into a store,
come out of the store, walk down, go into another store.
The e-commerce apps that have gotten really big,
they typically have something about the user experience
that's a little bit more magical.
Sam didn't back down. He was really aggressive and direct.
It always sucks to get tough feedback.
But I think that we're right.
I have put so much into this.
I mean, I'm on the line, so I'm not just gonna roll over and--
You know, at this point, my back is against the wall,
so I'm gonna do everything I can to try to get that funding.
It will be awesome to take whoever's playing in the Super Bowl
and watch their foxes battle before the game battle.
Everything's on the line. You've worked so hard,
and you don't want to let anybody down.
Doing this pitch, and making sure it goes right,
sort of defines how our partnership is gonna be in the future.
We actually have gotten a couple of retailers
to agree to promote us to their users
as kind of their de facto app.
This is fantastic because now when we go to the VC,
we'll be armed with these kind of joint ventures with people.
Like, that will be very impactful.
I have no idea if we'll get funding.
I think it comes down to my ability to communicate the vision,
communicate the traction, our numbers, what we've done,
and then fight for it too.
After six weeks of intense incubation,
Sunny and Will and Lauren and Gwyneth
are ready to pitch Tracks and Dote to Lightspeed Venture Partners.
Lightspeed was the first investor in Snapchat
and currently has over four billion dollars under management.
I'm pretty nervous, because, like, I know the product,
I know the direction we're going in.
But, like, actually pitching to somebody is... new to me.
It's like foreign territory.
I have worked so hard. Will's worked hard.
And, right now, everything's on the line.
This is Sunny, CEO, awesome engineer from Tracks.
Eighty percent of consumers of wearable technology
say that the main core benefit to wearable technology
is making health convenient.
What we think we've done is create a platform defining application
for watchOS specifically.
How much do you want to raise, and what do you want to do with it?
Basically we're looking to raise one million dollars in our seed round.
We're here today because we want you guys to lead this seed round.
So what have been the big changes in your app
since Will started advising you?
We've added some really core features to this.
We've added meaning behind your workouts in terms of social content creation.
Instead of saying, "I ran X amount of steps,
and this is probably a good workout for me,"
you can show your progress through the application
as being how much workout you've done.
You can compare against your friends and say,
"I want to compete against you and battle against you."
And you can do that within this application.
And you can do it in a way that really truly shows
who amongst your friends has been the most active.
Could you just be a little more clear about what you mean by that?
So say, for example, I work out.
And my workout for Monday consists of...
Um, I ran five miles,
my calories burned, et cetera, et cetera, et cetera.
All that is points for my pet.
Then people that I follow on Tracks--
I can see Kanye West ran similar miles,
but I want my pet to battle Kanye's pet.
Or I want my pet to battle my next door neighbour's pet.
So you have these challenges of your virtual pet
that go in battle, on your phone and your watch,
with all the workout that you've been doing
throughout that day or week.
So is it primarily about steps?
Is that dimension on which people are battling?
It's about steps if you don't have the watch.
If you have the watch, you get engaged on a whole new level.
You can count calories. You can count time.
We boil that into making your experience more engaging.
Just on the social side, where will they be sharing these updates?
You could publish on Twitter. You'll be able to record your battle
and then publish it on Instagram and on Facebook.
So, Sunny, was this a change in plan for you,
and if so, how much was input from Will versus kind of your own inspiration?
Basically, we came in with the application,
and in its beginnings, it only was-- You were taking care of this pet.
That was the main incentive.
But now, Will introduced us to some really interesting ideas, like,
why doesn't it battle?
It should battle. It should go that motivation.
Why isn't it social? It should have that motivation as well.
We've done this in a small team.
Right now it's myself and one other person.
So two people writing code?
I write all the code,
and I have the artist and designer,
who sort of gives me direction.
That's a lot of progress in a couple months.
-Yeah. -Mind-blowing progress.
Yeah. That's impressive.
Sunny, you seem great,
but it sounds like, Will, a lot of these ideas came from you.
No. I'm sorry. As a person--
I finished his thought.
The thought was there.
I didn't come with him with the alien ideas.
That's what good partners do.
Good partners see the qualities in them,
and then make sure that the collaboration is sustainable.
I'm not gonna sit here and say, "These are all my ideas." No, bro.
You had the great concept.
I just finished and completed your thought.
More importantly, we're gonna complete this mission together.
'Cause that's the reason why I was fighting for him
to be his mentor and his partner.
That's what this is about.
I truly believe in this.
Okay.
-So there's two of you in the company. -Yes.
So what's your burn rate right now?
Currently, we don't have to spend any money
in order to make this application.
I literally just make it out of my bedroom.
And we just sit there and just do this all day long.
-You're ramen profitable. -Can I add to that?
What do you fund when you're self-contained?
The thing that you fund is how fast you grow.
How fast you surround it with other Sunnys
that he's gonna hand-pick to help build his tech team.
Okay.
I love the brand they're building.
I really like the social angle.
And there have been some really big exits in this space.
It was just the other day that Talking Tom sold
for over a billion dollars.
That is something I think we need to think about.
This falls under this category of potentially just a feature.
-Hm. -There's other features
that have become entire companies.
So it's not yet clear to me which one this is.
If you can create the IP and own it,
there's a lot more value creation opportunity.
-If you can. -On the other hand,
if you can borrow someone else's IP,
then you can get the distribution
and break through the clutter a lot quicker.
So there's pros and cons to both sides.
Yes.
So for myself,
and someone who really believes in the health and wellness trend
is a huge wave that we need to be riding on,
I am excited about what you're doing here.
Um, I think that the characters you're building are great.
-Thank you. -Fine-looking foxes.
And the social element is exactly what we look for at Lightspeed.
That viral loop, if done correctly,
will really allow you to build a brand far faster and far cheaper,
which is what makes me excited.
Thank you.
I think your big insight here
is you can take something that's been treated as a utility
and turn it into fun.
And Tinder did that with the dating category.
And what you're trying to do is very similar with fitness.
And I think there's a big idea behind that.
The challenge that I have is that
half of the product road map ideation seemed to come from you.
-Mm-hmm. -And half seemed to come from Will.
So understanding whether we can continue to have that true North Star
that the product will move towards in the future,
and how that can really kind of be kept on track
is one of the core questions for me.
I see.
Sunny, you've clearly done a lot with a little here.
So with that, we would like to offer you 200,000
for us to invest in the business
on a 1.8 million pre-valuation.
In addition to that, we would like Will
to come on board as a co-founder.
Do you accept our offer?
To make this app successful,
we would need at least an investment of $300,000.
300,000 for 11% ownership, I would be happy with.
Aaron, Alex, Jeremy?
-I support that. -I'd be fine with that as well.
Let's do this.
Oh, my God.
Congratulations, Sunny. We have a deal.
Oh, my God. Thank you.
Oh, my God.
Thanks.
-Thank you so much. -Congratulations.
Congrats. I look forward to working with you.
Thanks a lot, man.
Thank you so much.
-Congrats, man. -Thank you. Look forward to it.
I love that Will was so passionate about this idea,
that he wanted to be on board,
and there was no doubt in his mind that we were gonna get the investment.
I love that they believe in the product.
Okay? They believe in it.
No. They believe in you.
They believe in... our team.
To walk away from Planet of the Apps with not only an investment,
but also partnership with my idol--
I mean...
You couldn't have asked for anything more.
You're there, bro, you're there.
So this is Lauren.
Lauren is the founder of Dote,
which I would describe as
a shopping app across all different brands
with an incredibly easy, one-step checkout.
Dote, as Gwyneth said, is a mobile shopping platform for brands.
Kind of like a shopping mall in your pocket.
So the Dote app is powered by our proprietary technology.
This tech essentially automates the inventory updating process
and also the order fulfilment process.
It essentially acts as a middleware to e-commerce sites.
So it sits on top of those sites
and doesn't require any technical integration by the retailer.
Brilliant. Can we just get a better idea of your ask?
-Yeah, sure. -Thank you.
We've raised our seed round.
We don't feel like we're quite ready for a Series A.
But we would love to have Lightspeed on board
to help us reach those milestones that we want to get to
before we're gearing up for that A-round in about six months.
So we're asking for 500k.
Quickly, how much money do you still have in the bank from the last round?
We have a good amount, so we're not in any kind of distress.
But I think that in about six months,
we should be able to get the valuation that we want
for that A-round.
And what was the post-money on the last round you raised?
Um, it was about 16.
And how much did you raise?
We've raised about two and a half total.
Okay.
Tell us more about your demographic.
Definitely right now,
the target demographic, or the beachhead demographic,
has been the very valuable demographic of the young woman.
She's in college. She's late high school. She's right out of school.
They're, you know-- They're Gwyneth's daughter.
-Um, so that is the current-- -Unfortunately for me.
So right now, 100% is female.
We wanted to focus on one market
and get a lot of traction there before pointing this at other verticals.
Even more important than the raw numbers
is the engagement for any individual, right?
So the average Doter comes back to the app
15 times a month, which is enormous.
They view about 180 products a session
and convert three to four times better than mobile websites.
That is one of the highest engagement rates that I have ever seen.
Why do you think that is?
One is notifications.
We do content notifications or trend notifications.
We do markdowns, so if you favourited something and it goes on sale--
Users love that feature.
We do-- If stores release new items
or are running any kind of promotion,
we notify you about that.
So it's a combination of different notifications.
But I do think that we're not shy about it.
Can you talk about competitors for a moment?
Sure. The way we think about it is aggregation/purchase intent.
Right? So for the Lyst and ShopStyles of the world,
they don't have a checkout.
And I just think that's a game changer.
Spring is probably the closest competitor,
but it's definitely a totally different approach
and a different demographic.
We're talking about $3,000 watches and very high-end brands.
You're targeting Middle America?
Yeah. I think to build a billion dollar business,
we need to be a mainstream company.
Wondermall is similar, but the product is nowhere near as good as our product.
I think that their numbers prove that.
They don't have automated fulfilment.
It's manual, and it's not PCI compliant,
and thus is not scalable.
So I think that those are kind of our big advantages.
But those two are the closest, I would say.
My daughter is oftentimes a focus group of one for me.
Because the psychology around how she shops--
I really think, for her generation, Dote is the answer for it.
Lauren, we'd really like to spend some time now
just speaking for a few minutes.
So just wondered if you could give us a few.
-Oh. Sure. -Thank you very much.
-Thank you, Gwyneth. -Sure. Sure.
The universe is so good. Thank God.
Thank you.
Oh, my God.
She, to me, is the customer here.
Her closest competitor, Wondermall,
does not seem to have a single person who is the core customer
of 15- to 35-year-old women.
Lauren is in that exact demographic.
And that makes me have much more confidence
that she'll be able to build a really big business here.
What I really like about this company
is they are riding this trend of "shopping is entertainment."
And they're doing it successfully.
What I worry about is that other companies are riding that trend as well.
Yeah.
So I just want to take a second to talk to you,
just as a founder who's been in a similar position.
I think it can be great to work with Lightspeed.
You will have such a huge heavy hitter behind you.
-Wow. Oh, my God. -Thank you so much. You're so amazing.
-No. Please. -This has been awesome.
It's amazing to watch you do your thing.
Let's talk about the deal for a second though.
Because she raised money at a 16 1/2 post. Is that right?
-Sixteen post. -Sixteen post.
She only wants to put in another 500.
So how can we end up having some sense of meaningful ownership in this round?
I agree. I don't think that a $500,000 cheque,
at a 16 post, makes any sense for us.
But if we like what we see here,
then I think that we actually think about a bigger cheque.
Green light. Green light.
-Welcome back. -Welcome back again.
Long conversation you guys were having.
It's an important decision.
You gave us a lot to talk about, that's for sure.
Lauren, we, as a team, would love to work with you.
We want to show you that we have real conviction in your idea.
So with that in mind, we would like to pre-empt the A.
We want to give you an offer today.
Five million dollars...
on a 16 million valuation.
We think you're amazing. It's a pretty fascinating business.
You're the authentic founder who understands what her customer wants.
Well, thank you so much.
I really, really appreciate
kind of everything that you guys just said, and--
Obviously, thank you so much. I'm, like--
So sweet.
Um--
I think the only concern is the valuation number.
Because I think that from a dilution standpoint,
um, that would be pretty intense.
Five million into 16 is a very heavy dilution amount.
In six months, when we go out to raise an A,
if we target five million dollars,
we'd be expecting valuation more like 30 million dollars.
What sort of firm do you think would do five million at 30
with 11% ownership in a Series A?
Do you think you can get
a top tier Silicon Valley venture capital firm to do that?
Um-- I think that--
I understand the way that you're thinking about it,
and I think the 20% ownership target is right.
But 16 million still doesn't get us there.
We can help you with hiring. We can help you with customer acquisition.
We can help you with the relationships that we have with retailers
to make sure that you're getting paid for the work that you do.
And we can be your full partners for growth.
We want to give you five million dollars today
on a 20 million dollar pre.
Okay.
We would love to accept the offer.
If I wasn't wearing heels, I would do cartwheels!
-So exciting! -It's so exciting!
-Oh, my God. -This is gonna be so fun.
Congratulations.
Yeah. You've done an awesome job.
Thanks.
We are gonna build something so great.
We are. Thank you so much.
-We're excited to help. -I'm so excited.
This is my first company.
I mean, I've never done anything like this before.
Having five million dollars,
the pace at which we could ship our product,
move into new verticals,
strike new deals with retailers--
It's just completely game changing.
I think Dote is gonna be a billion dollar company,
and I think Lightspeed has what we need to help us get there.
Thank you!
We'll talk soon.
All right. Bye, you guys.
So excited.
You watched Sunny capture the interest of Lightspeed
and Lauren pitch her way to a five million dollar investment.
Look for the renamed Tracks Battle Squad, Dote,
and all of the apps featured on Planet of the Apps
on the App Store.