Introducing Gary Woodhead from Curveblock
Q: Could you give us a brief introduction to yourself and Curveblock?
A: I’m Gary Woodhead, a co-founder of Curveblock, a unique startup that’s a blend of fintech and construction. Our fintech aspect is all about revolutionizing the shared economy. We have a grand vision of enabling the public to finance the construction sector. Our approach simplifies the process, allowing individuals to buy digital shares in Curveblock, granting them rights to a portion of the company’s profits. What sets us apart is that investors don’t need to select specific developments to invest in.
Think of it like a mutual fund. For example, if someone invests $100, they receive shares corresponding to that amount, entitling them to a share of the profits from all our projects over a defined period, like 10 years. This model requires no specialized knowledge or time commitment from investors. We’re also unique in how we share profits, splitting them 50-50 between us and the public, ensuring we all grow together. This approach allows ordinary people, from nurses to factory workers, to participate in what has traditionally been a privilege of the wealthy – profiting from the construction sector.
As for what we build, it ranges from holiday homes and residential houses to commercial buildings – anything profitable. We also focus on sustainability, integrating renewable technologies to make these buildings energy independent and even energy positive. This initiative not only tackles fossil fuel dependency and CO2 production but also addresses the growing issue of energy poverty, especially in places like the UK.
Q: What inspired the creation of Curveblock and how did the idea come to life?
A: My journey to founding Curveblock started with my interest in Bitcoin and its underlying technologies, like smart contracts and fractionalization. I noticed several startups in the space were fractionalizing physical assets of a building, such as bricks, and sharing rental yields among shareholders. While this concept was innovative, I didn’t find any startups that were fractionalizing the equity and debt underpinning the construction sector. Having been in the construction industry for over 30 years, I decided to turn my ideas into a tangible plan. I put my thoughts on paper and shared them widely, which received a very positive response. This exposure led to us being noticed by a tier-one bank, who were intrigued by our novel approach. They invited us into their accelerator program at NatWest Bank, and that’s where Curveblock’s journey really began.
Why Founder Institute?
Q: What led to Curveblock’s involvement with the Founder Institute?
A: Curveblock’s path to the Founder Institute was shaped by the challenges brought on by COVID-19. About a year into our journey, with angel investors on board and a team being built, the pandemic hit. Investors I was in talks with withdrew, focusing on their existing portfolios due to the uncertainty. Then, the Prime Minister shut down construction, leaving me to ponder our next steps. I’ve always admired Silicon Valley accelerators like Y Combinator, and during this period, my attention was caught by an ad about the Founder Institute running a virtual cohort due to COVID. Seeing this as a huge opportunity, I applied, went through their intelligence test, and paid the application fee.
The competition was stiff – out of 430 UK startups that applied, only 67 were admitted, and just 10 of us graduated. I was among those ten, ranking second in our cohort. Interestingly, the top-ranked participant ended up investing in Curveblock, seeing potential in what we were doing. The Founder Institute came to us as a silver lining amidst the pandemic. Typically, these accelerators require physical presence for months, which is a significant challenge for pre-revenue startups with family commitments. The shift to a virtual format due to COVID was a fortunate twist of fate, bringing this opportunity right to us.
Navigating the Founder Institute Application
Q: Can you describe the application process for the Founder Institute?
A: The application process for the Founder Institute began with an AI-driven intelligence test, consisting of various situational questions. These questions assessed how I would respond in different scenarios and evaluated my thought processes as an entrepreneur. This test aimed to identify potential quitters and those who had the mental fortitude to navigate the challenging journey from concept to product. After the intelligence test, which returned positive indicators for me, the rest of the application was quite straightforward. It involved detailing our solution, the problem it addresses, execution strategy, scalability, and impact. Fortunately, we had most of this information pre-written before applying to the Founder Institute, so it was mainly a matter of copying and pasting the relevant details. About three to four weeks later, we received an email from them. They were impressed with our unique concept and its potential societal and environmental impact, inviting us to join their first cohort.
Q: Were there any rounds of interviews during this process?
A: Interestingly, there weren’t traditional interviews in the application process. The Founder Institute relied on the AI from the intelligence test to serve as the interviewer. This approach streamlined the process and focused on the insights derived from our responses to the situational questions.
Funding and Support from Founder Institute
Q: Upon being admitted to the Founder Institute, did you automatically receive funding?
A: No, admission to the Founder Institute didn’t come with automatic funding. The primary focus was on rigorously analyzing and reconstructing our business model over a three-month period. The program consisted of 12 segments covering various aspects like problem-solution fit and product-market fit, aiming to deeply understand and refine each element of our startup.
Before graduating, we were required to sign a warrant allowing the Founder Institute to buy a percentage of our common equity at our current valuation. For instance, if they were to exercise this option now, they would buy in at a valuation of 12.4 million pre-revenue. This valuation could change based on future fundraising rounds. Although direct funding from the Founder Institute wasn’t part of the deal, it indirectly led to financial support. The first investment came from the winner of our cohort, who found our startup appealing and decided to invest. More significantly, the Founder Institute facilitated our connection with Loyal VC, a venture capital firm based in Toronto, Canada, which focuses on investing in Founder Institute graduates and INSEAD Business School students. After being introduced to us by Mercedes Bankston, our director at the Founder Institute, Loyal VC initially invested a modest sum of about $15,000. We underwent a 12-month reporting process with them, and upon achieving our first significant traction event – a £6 million order in the construction sector – they invested an additional $200,000. So, while the funding process was not as direct as in some other accelerators like Y Combinator, it was indeed fruitful in the long run.
A Glimpse into the Founder Institute Program
Q: What was your experience like in the Founder Institute program, and what did a typical day involve?
A: The Founder Institute program was a mix of enlightening and challenging experiences. As it was virtual, engagement varied among cohort members; some were highly interactive, while others were less so. Each segment of the program brought in specialists, which was quite informative, especially when discussing topics like regulation. We didn’t get to meet Elon Musk, who is closely connected to Adeo Ressi, the founder of the Founder Institute, but the network and connections in the program were impressive. While some parts of the program could feel mundane, like going through profit and loss (P&L) projections, it was all valuable, especially for a pre-revenue startup.
Our weekly meetings lasted one to three hours, and we also had digital coursework to complete. This coursework was assessed by mentors who graded our input on various elements. There was a live points chart showing how each startup was performing, which added a competitive edge to the program. Given that Curveblock was already a year old when we joined, a lot of our responses were essentially refining and repurposing existing content to fit the program’s template. This prior preparation was advantageous and likely contributed to our successful graduation. Newer startups, without established materials, found it more challenging due to the substantial amount of work required.
The program also included pitch events, which were high-pressure situations. Your pitch’s quality could determine your continuation in the program. Fortunately, with a year of pitching experience behind me, I managed to navigate these events successfully.
Ultimately, we completed the final elements, signed the warrant, and became alumni. The program required significant digital input and time commitment, effectively filtering out those who weren’t fully prepared or dedicated.
The Standout Advantage of a Silicon Valley Accelerator for UK Startups
Q: In your opinion, what was the standout feature of the Founder Institute program?
A: The most significant aspect of the Founder Institute for me was its Silicon Valley pedigree, especially when working with British startups. Being a UK startup that graduated from one of Silicon Valley’s most challenging accelerators is a major achievement. It’s like getting a green light for due diligence from potential investors. Many investors tend to shy away from the in-depth due diligence process, but having the Founder Institute’s stamp of approval changes the game. When you tell an angel investor or venture capitalist that you’ve not only participated in but graduated from such a rigorous program, it often eases their concerns. Out of 430 startups, being one of the 10 to graduate is a significant endorsement. Some investors are ready to invest just based on this achievement.
This accomplishment serves two key purposes: first, it validates your business model, as the program thoroughly deconstructs and rebuilds it. Second, it proves that you’ve achieved something exceptionally difficult, which is invaluable when approaching investors. In the investment world, particularly in Silicon Valley, many investors follow lead investors like Jason Calacanis. If a notable investor backs a startup, others often follow, assuming the due diligence has been thoroughly done. We leveraged a similar approach, highlighting our graduation from the Founder Institute, which proved to be effective. As a result, we have attracted 53 angel investors and the support of Loyal VC.
The Impact of Founder Institute on Curveblock’s Success and Investment Readiness
Q: To what extent do you attribute your current success to completing the Founder Institute program?
A: I would say that completing the Founder Institute program has contributed significantly to our success, particularly in terms of investment. About one-third of our investors came on board as a result of our graduation from the program. While the program didn’t directly bring in partnerships, and our major traction events, like building a prototype, were achieved in-house, the credibility and readiness we gained from the program played a crucial role. Specifically, graduating from the Founder Institute was instrumental in helping us raise over a million pounds GBP.
Q: Did the Founder Institute introduce you to angel investors or help you connect with their network?
A: No, the Founder Institute didn’t directly introduce us to angel investors. However, they guided us on how to prepare for engaging with such investors. This preparation included creating a data room, which I hadn’t done before joining the program. They essentially get you investment-ready. While they do have angel investors in their mentor and advisor network, it’s not like Y Combinator where investors are present at graduation events ready to invest. The process with the Founder Institute is more about mentoring and guiding startups on how to find and present to potential investors. Although we did interact with some advisors and mentors who could potentially invest, the likelihood of securing investment directly from the angels within their ecosystem is relatively low. This is especially true for us, being UK-based, as the majority of their mentors and advisors are in the US.
Essential Advice for Startups
Q: What advice would you give to startups considering applying to the Founder Institute or other accelerators?
A: I strongly recommend that any startup consider joining an accelerator. The key benefit is leveraging the due diligence process that these programs offer. We’ve been through accelerators run by two tier-one banks, and both have directly led to angel investment because passing their due diligence is a strong endorsement. Investors often question a startup’s legitimacy, and being associated with reputable accelerators can significantly ease these concerns. Moreover, accelerators provide excellent educational opportunities and validation for seed investors. As you grow, it’s crucial to evaluate the investment terms and the equity you’re giving away. For example, while Y Combinator offers a clear investment, they also take a substantial equity stake. It’s essential to consider how this impacts your valuation and cap table.
Also, as you move to more mature stages, seek out accelerators led by industry giants for their brand association. Our participation in programs run by Barclays Bank and IBM has been incredibly beneficial. Such associations can significantly boost a startup’s profile. Remember, not participating in these accelerators might lead investors and partners to question your startup’s credibility. The backing of well-known entities like Barclays and IBM not only adds credibility but also reduces risk, making it easier to raise funds and enter the market. As a first-time founder who has successfully navigated the challenging early stages and raised significant funding, I can attest to the immense value these programs have added to our journey.