Pitching Cafe X to Investors | Co-Founder & CEO Henry Hu @ Draper University

Hey everyone, you’re about to watch the founder
of cafe x. His name is Henry, who and he’s got an amazing
story. If you want to be one of the entrepreneurs
learning here at Draper University, just like the people you see in the audience, make sure
you apply today at Draper university.com. Hope you enjoy the video. back to when you started cafe x. You had your MVP, you tried to pitch to investors
talk to us who were the first investors you spoke to, or the angels, VCs, that whole experience
because a lot of the batch here will be raising money within the next six months to a year. And I think they would benefit a lot from
knowing that experience from your end. Yeah. So we initially just like well, first like
I, like sold my car in college and have a little bit of money to buy a coffee machine,
and a robot arm. And then we were able to get like a little
bit of money from friends and family in Hong Kong. So that we use that to like build up first
prototype, when we actually like, started to raise serious money. What our first investor or professional investor? It was Jason Calacanis. So I know Jason, because I used to like what
I still do, because I listened to his like podcasts. So like, other than Jason, I didn’t know anyone. How did you reach out to him? Yeah, so he actually has an episode that talks
about how to reach out to investors. You actually follow that? And it worked? Yes. Like, okay, just just follow it. The other obviously, in addition to following
it, you actually need a working product or something that that that is well designed. And so in the email, I basically included
a link to a YouTube video that showed our first prototype working in Hong Kong. And like, I got this quick response from him. That was an automated response. It says this email gets, you know, hundreds
of emails a day, don’t don’t expect a response. And a few minutes later, a response comes
and it’s like, Is this a joke? I think he thought it was like animation or
something. Yeah, but obviously explained to him it’s
not. And then met him in San Francisco, and then
joined his incubator. And after we did, the launch incubator, actually
now it’s called launch accelerator. But after we did that, we had a conference called LAUNCH Festival. And Jamal from social capital was there doing
the speaking, he got to try out the product because we had two machines they’re demoing. So basically, like the incubator after the
conference, trim off is like I want to invest. He invested and then and then Khosla ventures
came in as well. So that was our seed round, which was around
three and a half million. And then other investors as well. And then a few months ago, we closed our series
A, and our new lead investor is craft ventures. So David Sachs is new, new firm, or it’s not
really new anymore, but so that that, that was really nice. And David and Jason are now on our board. So today, we’ve raised about 14 million, and
we’re going to do our series A in like six to eight months as our Series B cheese in
six to eight months. Awesome. Well, yeah, we’d love to show you around. There’s tons of venture funds here that we’ve
talked about. And I think there might be some interest there. In terms of the people that said, No, why
were they saying, you know, how many people did you pitch to? What was the biggest, I guess, challenge there
when they kept saying no? Why no. And then why Yes. I think the main reason for know is like we’re
not really a normal tech company. Like we have this giant machine that we build,
there’s, there’s hardware, which is like, boo, there’s real estate, you like work basically
dealing with the real world to like, get it doing like real estate deals, dealing with
regulations for VCs. So we basically like check a lot of the boxes
for things that VCs traditionally don’t like. So that that’s like a main reason for white
white, why it’s difficult, like to is like so, you know, now I’ve kind of learned this. So So we’ve been, we’ve been changing things
around a bit. But initially, I was just like, very, I was,
I think, maybe a little too scrappy, like, I didn’t think it was that important to try
to hire experienced an expensive, like, executives early on, I was just like, you know what,
we’ll just get it dive in and hack it together and then prove something and raise money. And obviously, that that is not the case. So we now have a CEO, Cynthia, who’s just
like, amazing, and how has has been extremely helpful. And then we also hired a director of hardware,
who came from from Tesla, actually. So that basically they were just like, bringing
in all these people with a lot of experience on the team. And that’s not only improved the product a
lot but also helped us with raising money.

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