When Gagan Biyani started building Udemy in 2009, he and his cofounders, Eren Bali and Oktay Caglar, had high hopes for the edtech startup. 

Biyani, who oversaw Udemy’s marketing and investor relations, left in 2012 to serve as a growth advisor for Lyft. In three short years, Udemy had grown its funding to $16 million, with 400,000 registered students using the platform (those numbers are much, much higher today). But that success took over a year to set up.

In a recent Twitter thread, Biyani detailed how the run-up to Udemy’s launch went (spoiler alert: mistakes were made). “We built an impressive product, but we were nobodies,” Biyani said in the thread. “We thought: we need money to build our vision, so let’s go talk to some investors. WRONG. Nobody gave a fuck that we needed money. We needed to prove we deserved their money.”

Biyani and his cofounders pitched to over 200 investors in 12 months of fundraising, and got over 200 rejections. But that didn’t stop them. They kept attempting to court investors or intermediaries who could connect them with investors, but growing their network didn’t pay off. Eventually, they realized that they needed their company to gain more traction before fundraising. Bootstrapping was the way to go.

Biyani confessed that he treated those initial investors as “adversaries” instead of appreciating them. “An investor's job isn't easy,” Biyani continued. “They kiss a ton of frogs just to find one deal that may make them money 10 years from now. They only win if you become a billion dollar company. Don’t kid yourself - if you aren’t the right fit, bootstrap. Risk-adjusted, bootstrapping can make you happier and more successful.”

Another mistake Biyani made was during the pitch itself: He focused too much on Udemy’s next quarter, when he should have focused more on the big picture. “Paint a picture of 10 years in future: how will the world be different and how will you build a $1B+ business?” he said.

After hundreds of refusals, Biyani thought his luck had returned, but it proved to be a red herring. “Everyone said no except one Turkish billionaire,” he said. “Don’t trust Turkish billionaires. Don’t trust any investors who are outside of the Valley ecosystem. The billionaire ghosted us.”

The Turkish billionaire fiasco proved too much for the founders. According to Biyani, “we accepted defeat and regrouped.” 

It was then that they realized their biggest error: not launching. “ Investors could smell our launch anxiety and didn’t invest because there was no traction or urgency,” Biyani said. “Show the investors you’ve got chutzpah. Press the button.”

Finally, Udemy had launched in early 2010, and by then, two VCs had signed on: Darian Shirazi and Bubba Muraka, both of whom were mentioned in Biyani’s thread. After that, investors like Keith Rabois and Russ Fradin jumped on board, snowballing progress. “There is a ‘whisper network’ amongst investors: they all share notes. If you want to raise a round, get into the network,” Biyani added.

Ten years down the road, Udemy is worth $2 billion, and according to a report by the Information, the company is seeking a new round of funding to get up to $3 billion. The COVID-19 pandemic has accelerated edtech’s growth, but Udemy had been climbing years before that.

Biyani ended the thread with some words of encouragement to all the entrepreneurs out there. “Raising is only the beginning,” he said. “The real work continues; take a moment to celebrate, then get back to building!”

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