#163: Capital Raising Insights
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What makes Yotis Tonnelier's journey into capital raising truly exceptional? How has his unique blend of Belgian heritage and American culture shaped his approach? This week on The Richer Geek Podcast, explore the insights of Yotis Tonnelier, founder and CEO of YOBE. From managing investments for HRH Prince Al Saud of Saudi Arabia to launching a consultancy dedicated to trust and transparency, Yotis has been a driving force in redefining industry benchmarks. Join us as he shares expertise on navigating the capital raising landscape, fostering success for founders, and maintaining ethical standards in an often challenging industry.
In this episode we're discussing...
Yotis Tonnelier's background: Yotis shares his journey from Belgium to Miami and his experience working with HRH Prince Al Saud's family office in Europe. He highlights his transition to the U.S. and founding YOBE to address the need for trustworthy investment opportunities.
YOBE's Mission: YOBE assists unique founders in raising capital through transparent methods and passionate dedication. They operate a syndicate of investors who invest in exclusive projects aligned with their values.
Challenges in Investing: Mike and Yotis discuss the challenges investors face, including the overwhelming amount of information and the prevalence of scams in the investment landscape.
Due Diligence: Yotis emphasizes the importance of due diligence for investors, suggesting platforms like Crunchbase for researching investment opportunities. He stresses the need for transparency and thorough analysis of documentation before investing.
Opportunities for Founders: YOBE offers services to founders seeking to raise capital, providing guidance and connections to potential investors. They prioritize credibility and transparency in their partnerships.
Future Plans: Yotis discusses YOBE's plans to launch a fund to accommodate investors interested in participating in multiple deals. They aim to raise $20 million to support founders and expand their investment opportunities.
Resources from Yotis:
LinkedIn | YOBE | Email | Newsletter | Book a 1-on-1 Meeting with Yotis
Resources from Mike and Nichole:
+ Read the transcript
Mike Stohler
Everybody welcome back to another episode of The Richer Geek Podcast. Today's episode is brought to you by REI Words, your go to SEO agency for increasing traffic to your website. Check it out at reiwords.com. Today, we have Yotis Tonnelier, he's the co-founder of YOBE. What they do is they help invest in unique founders, in addition to help them raise capital through transparent methods and unwavering passion. They also have a syndicate of investors that generate profits by investing and their exclusive projects that help align with their values. Yotis, how're you doing today?
Yotis Tonnelier
I am doing great. Thank you for having me today, Michael.
Mike Stohler
Absolutely. You know, this is very important. We have a lot of listeners out there that want to go into investing, maybe some of them are. And they're wondering how is it that they can, they've done five or six deals, but they need that $10 million raise, they need a larger raise, they need more sophistication, but they don't really know how or where to go. Let's talk a little bit about what you do and the history of where you come from, and how you can help these people out.
Yotis Tonnelier
Of course.
Let's start with a little bit of an intro of myself. I'm originally from Belgium, from the French part of Belgium. So this is why I've a French accent as everybody can hear. Moved to Miami 10 years ago. Before that I was involved with the incubator, a European incubator called The Family, the same as Y Combinator. But in Europe, we were really huge in 2014, 2015, 2016. After that I worked for Prince Al Saud, a direct cousin of MBS. So I worked for his family office when I was in Europe. So overviewing first advising and then overviewing his investment in a startup in Europe. So it was really precise on that. Two years after that, I moved to Miami, stayed in the same field investment, startup, advising the two exits here in the US, worked for an investment bank, and opened my own structure in 2020. With COB to respond to the question you just asked, or to find their partner to raise funds in this industry and someone that can deliver and not just sell dream. What I like to say is we are selling reality, that's our job instead of dream, but it's not easy for sure.
Mike Stohler
That's extremely important. And listeners, if you're out there, and you're thinking, I just want to invest passively because I need to diversify my portfolio, the IRA, my 401(k)'s not going to do it. But it's so scary to sit there. I'm you're inundated by LinkedIn ads, Facebook ads, raise money with us now there's email blasts, you don't know anything about these general partners. And it's so scary. Let's talk about number one. Why is it that scary? It seems like people know that they see all these YouTube videos, get rich quick schemes just create a syndication? How do I know that they even have done a deal? You know, it's a scary proposition.
Yotis Tonnelier
So I believe as an investor, you need to go to a phone that has credibility, but as history you have Crunchbase. Crunchbase is a platform that you can even try for free if I'm not mistaken. And that will allow you to see the deal that this fund did in the past, I will not base my guess on only YouTube videos or LinkedIn. Everything can be bad. So let's be real. If you have a little bit of money, you good with online advertising. You can be the next green card in one month is not the problem. I strongly believe that you need to base your confidence and your trust on facts and try to go to this website like Crunchbase, to see what they did. And also, if you do a little bit of due diligence, you can find the real article about the deal that was found in the past. And that's all investors should do. If they don't have an advisor or something like that, it's really spent some time to find the right team, the right general bought their team for them.
Mike Stohler
Yeah, and let's talk about some of the bad history, the SEC can only do so much. But if you're, let's say, an accredited investor, and you sign that you've looked at the offering, and it goes under once people get an offering memorandum, what are some of the things that they need to kind of look at? And then based on kind of the bad history of capital raising? What are some of the things that people have tried?
Yotis Tonnelier
Yes.
That's a great question. Personally, with YOBE, part of our first step is to look at the deal as an investor because with our business model, we are investors at the end as well. And I will talk to you about that later. But what I'm looking to deal is the transparency I have on the documentation. So when I said the documentation is the deck is the financial or everything is explain the past performances, if you are trying to invest on the fund, that's where we I like to call that green and red flag. That's my personal talking about that. But that's where I'm trying to find red flag when I'm doing a due diligence, I'm not looking to your green flag, I'm not looking to the to the positive return, I'm trying to find what is negative about this deal, because when you know what is negative, that's where you can really base your investment and base your strategy. If you buy on the positive, everybody has a great story, everybody is the best in the world, everybody has the next unicorn. So don't worry about it. I heard sorry, like that. It's like 10 times a day. And that's part of the marketing for fundraising. But you need to really go deeper on due diligence. And again, transparent financial, when someone sent me a deck and, or when I asked for financial, honestly, like 50 percent of the deal, I don't receive it. That's already 50% of the deal, you are not going to lose your money. It's simple. When you're an investor, you have every right to ask. And that's the biggest advice I will give to an investor. Just ask, ask the question, ask as much questions as you can. Ask to see everything, the financials, I have company, for example I'm asking the salary cap of every member of the company some of the founders saying, "Hey, I don't want to give that." Okay. If you don't want to give that, why I will invest my money if I don't know if you are, trustable enough to manage it? I want to see what you're going to do with my money. And every investor should be like that, when the investor we are representing, that's why we are representing them to be sure and to secure our investor in a deal that is legit, and high quality deal.
Mike Stohler
Yeah, it's extremely important to everybody's are those types of things. Look at I know it can be overwhelming. You may even want to have your attorney, look at a contract attorney, look it over don't have your best buddy, who's a divorce attorney or injury lawyer, look at it go to a real estate attorney that knows those things. And look for those red flags. Are they some of the words I hate? It's like "we guarantee" as soon as you say that, that's a red flag, right?
Yotis Tonnelier
It's not even red flag for me, it's illegal. When someone is telling you that the deal is guarantee is not even the red flag. You don't invest. Like you know that if you invest, you're going to lose your money. Because legally and you know the rules might go legally, you cannot guarantee any investment. There is always a risk, even if it's one person putting your money in the bank account even now is better with the IRA limit, but it's even a risk. So every investment has a risk.
Mike Stohler
Yeah, it's very important people's you've seen these videos on these ads, we guarantee up to a 40% return we do this or that. Like nobody has a crystal ball. I try to rub this bald head all I can foresee in the future. But you can't. And that's why you have prospectuses and things like that in my syndications, it's probably two or three pages of what the deal was. And then there's 40 pages of why you shouldn't invest with me but you want to pay attention to those three pages. And can you tell us some ways that you sit there, you look at the general partner. You'll also look at the prospectus and all the paperwork, all the marketing, the salaries, what are some of the other kind of bullet waits that you look at also, but then even if people want to go on their own, what are some of the major highlight things from first part of the maybe the syndication paperwork down just a few points,
Yotis Tonnelier
Let's say a new investor, beginner investing. And that's what we do. That's part of our strategy with CRB, we are not going to early stage company, because when you're going to early stage startup, you need to understand that the right strategy with early stage is volume. Okay? So you're going to invest in 10, early stage startup, okay, nine of them is going to die. Okay, nine or nine of them, you're going to lose your money. And usually, on average, one of them is going to go well and cover the rest, okay. But you need to understand that you need to understand the strategy, it's a long term play, what we do is to minimize this risk, we invest only on growth stage, we call that growth stage, that's me, these can be seen more seed breed share with a series B, but the company needs to have a market fit. So that means the company already has revenue, the product works, the markets already gets Greenlight, that the market is a product fit market. That's what we call that for the one that doesn't know. And so this minimize your risk already. And after that, which we do and what we look, we are a founder oriented. For us, 90% of the success of the company, is come from the founders. So what we like to invest in is serial entrepreneurs, founders, people that already had exit, people that already went through the pain of being a successful entrepreneur and has this experience. And so we know are two processes to execute with this company. So that's really our focus. And this allowed us really to ever a great return over the years. And the long term.
Mike Stohler
And everybody again, we have Yotis Tonnelier here with the website, if you want to look at Y-O-B-E consulting.com (yobeconsulting.com) For those people that are listening that might be interested in YOBE, what industries do you look at for the founders?
Yotis Tonnelier
Yes, so we are agnostic, globally. Why we are agnostic? Of course, we don't touch for example, for business, this business that is not like, it's different. It's not traditional, but the traditional industry will stick out. Why we are agnostic is because for every project that we out to raise the phone on we invest with our syndicate, as we are really focused also on the timing. Best example is with crypto and the blockchain, you know, right now it is getting back to the front page, at the end of last year, it was cold, but you cannot raise even one penny for them. So you need to understand, also your all industry is performing and what will be the cycle because every industry is a cycle. So you need to make sure that you are taking the investment at the right time. So that's why we are doing that. And of course we have database that helps us to have all this information and base our due diligence and our analysis.
Mike Stohler
Yeah, and that's good to know. And for one thing, people that maybe my next hotel deals like do I want to go through? And this is what as a GP? Do I want to go through the pain of putting out a syndication and trying to raise $10 million on my own or my team? And not knowing is it gonna be two months is gonna be six months is gonna, “Wow, what's I'm going to list on my database and other people's database.” Or I could go to yobeconsulting.com. If I'm even strong enough and have enough experience and have them do it for us? What are kind of the steps involved? I go to yobeconsulting.com I click on, "Send us your deck." How does it work?
Yotis Tonnelier
Yeah, so very simple. You can go to our website, send us an email directly or contact us. We have a live chat you can send by the button you said or you can find me on LinkedIn. I have a couple of followers on LinkedIn. And we are really present on LinkedIn, Facebook, Instagram, you name it, we are there and my email is everywhere. So you can send the deck you will be the best way to do it. Send your deck. We are going to do our analysis and get back to you saying "Hey, we can help you." Our goal is to make sure we can help you and by helping you actually raise the fund. After that we have also for younger companies, we also have advising services that we are offering that's what we process so it doesn't cost anything to anybody. We want to make sure first, we are eligible to help you. So that's the process. After that we meet, we have an intro call, I want you to meet the founder, ask your questions, I will have questions, I will already know your industry, I will know your deck.
Mike Stohler
Now, how about on the other side, we also have a lot of listeners that love to diversify on the limited side. And we've been kind of in the background talking about your investors, your investor pool and creating things and now you have a fund that's coming out you're kind of wanting to get in on the founder side because of some of the feedback you've had from your pool of investors. Let's talk about that a little bit.
Yotis Tonnelier
Yeah, so globally, right now, we are not a broker dealer.We are not holding the money. So we have a syndicate of investors where we are providing the deal and whether they are choosing to invest or not is very simple. When they choose to invest, we introduce them to the founder, and they invest in the deal as a direct investment of the company. Very, very simple, simple, but some of them now they and we got feedback saying, "Hey, I know you have to be different," because we are doing multiple raises over the year even if we are really oriented on the quality. So last year, we did seven raises. this year, we are going to do maybe 12 raises, not more. And they say, we would like to split the risk and invest or all the deal , or can we do that? So we understand that now we have the credibility to open a fund. So the goal is to open a fund in Q3 to be able to welcome this investor that want to invest in all the deal, but also for the founder, be able to put a ticket up front. Also with the founder we are representing instead of going through our syndicate is now able to put a bigger ticket. And we are talking 250 to a half a million ticket. That's really the goal we are planning to raise 20 million for the fund.
Mike Stohler
That's fantastic. We talked about sending us your deck, how can people say "Hey, you know, I'd love to be part of this with YOBE." How can they get on the investor side?
Yotis Tonnelier
Yeah, on the investor side, they can contact me. I like to meet all the investors. So you know, all the investors that work with us know, my team knows myself or our Head of Investor Relations is Cesare Pesci, great guys doing a wonderful job. So we meet with them. And after that we discuss we have an office here in Miami, for the ones that are based in Miami. We have an office in Paris, and we are opening Riyadh, at the end of Q2. We are working on it because we have good connections over there from my past experiences. So yes, I'm happy to talk with anybody, even people that have questions,happy to help. We are here to out when your investor, the goal is to really to avoid, let's say not legit deals big deal. I think that's the worst for everybody. For people that doing that want to make money, don't get me wrong, we are all here to make money. But we like to do it the transparent way and with trustworthy people that work all day, every day to make it happen for their investors. So that's what is really important to us.
Mike Stohler
Yeah. And now everybody is investing on your own doing yourself trying to figure out is this general partner good? Is the syndication good. It's very stressful. If you go the route , nothing is guaranteed, right? But if you want someone to do a lot of the due diligence for you, a lot of the safety net some of the things that will take the stress off for you, contact Yotis at YOBE. And I think it'd be a fantastic way for you to get inside of that limited partner spot. And maybe as a founder on the general side. Yotis, is there anything else that you'd like to discuss before we go?
Yotis Tonnelier
No.
I certainly am waiting for your deal as well Michael, I know you're working on it. So I'm waiting to have the opportunity to look at it. The only thing I will add for the end is when you were an investor or you're a funder, don't trust the social media, don't trust the fake information, do due diligence on really bold websites and platforms, realistic numbers and facts. That's the most important stuff to do and what I advise you to do, and there are always people that will be there to help you. That's the most important.
Mike Stohler
Yeah, yeah. Fantastic. Yotis, thank you so much for coming on to The Richer Geek Podcast. Have a great afternoon. And God bless. Take care.
Yotis Tonnelier
Thank you, Michael. Thank you, Michael. Thank you, everybody.
ABOUT YOTIS TONNELIER
Yotis Tonnelier, a Belgian investment luminary, is the founder and CEO of YOBE, a consultancy poised to redefine industry benchmarks in the U.S. capital raising landscape. With a background in managing investments for HRH Prince Al Saud of Saudi Arabia, Yotis recognized the untapped potential in the American market for capital gains and raising, leading to his relocation to the United States in 2017. Driven by a passion for transparency and ethical standards, Yotis founded YOBE with a vision to assist exceptional founders and investors. Under his stewardship, YOBE has achieved remarkable success, raising over $65 million and maintaining a 92% success rate in fundraising.