Startupfest Founders Detail Near-Death Moments, Pricing Blunders

Andrew Lockhead, the CEO of travel tech company Stay22, shared how he pulled his company back from the brink of death. The pandemic shutdown caused investors to pull out just a month after Lockhead had assured his team the funding would sustain them. "Definitely regret that," he said, shaking his head. The company came back stronger, building AI into its workflows and securing a $122-million USD investment.

Laura Lalonde, CEO of user-generated video app GridBank, said her worst day as a founder came before she had ironed out her pricing model and was struggling to onboard customers without losing money. "My dad looked at me [and] he was like, 'If you can't make money, maybe it's not a business,'" Lalonde said. "It sent a chill down my spine." The founder figured out pricing the hard way, by doing more than 200 individual consults with customers. Now, Lalonde says the startup has thousands of paying customers and more than a quarter of a million videos uploaded to its platform.

Rene Caissie, CEO of Medeloop, a former surgeon who sold his first company to Telus, told the crowd he has been through near-bankruptcy and running out of money the day before payroll. He also got caught not knowing the meaning of EBITDA (earnings before interest, taxes, depreciation, and amortization). He assured the crowd the best founders don't let those obstacles dissuade them. "When you start listening to very successful founders, you find out that this is normal," he said. "You just have to grind through it on a daily basis."

The panel, moderated by Storytime Capital managing partner Neil Grunberg, drew nods of recognition from the founder-heavy crowd. The message for investors tracking venture-backed portfolios is that operational risk, specifically pricing and cash management, is the common thread in startup failures, the panel suggested.