Austin Allison sold his college startup for $120M, after raising just $14M. His latest venture has already brought $1.7B in capital onboard and is growing.
During our interview on the Dealmakers Podcast Austin shared his young start as an entrepreneur, going from side hustles to all in. He also talks about how to find your first investor, and what you do when you sell your company for $100M. Plus, the difference between raising debt and equity. As well as how to know when you’ve got the right idea, and surviving the lows and crisis moments of entrepreneurship.
The Ultimate Guide To Pitch Decks
Drive & Young Entrepreneurship
Long before landing in Napa, California where he heads up his latest company, Austin Allison was born in Cincinnati, Ohio.
From a young age, he found he had a great entrepreneurial drive. Something he credits to his father. A self-employed carpenter who always worked hard, hustling to get his next project.
This gave him an early insight into what it was like to run your own business, manage others and your money. It also got Austin interested in real estate.
After fun young gigs, riding around the neighborhood selling wooden birdhouses, he had saved up enough for the down payment on his first fixer-upper home by the time he was 17.
By 18 he had begun selling real estate to pay his way through college. He started by studying architecture and real estate development.
Then inspired by one of the coworkers at his real estate brokerage he put himself through law school, which he dubs ‘academic boot camp.
Side Hustles & Going All In
It was in law school that Austin Allison says he struck on the idea for his first big startup. He found himself growing frustrated at the inefficiencies in the world of real estate transactions.
Specifically at the lack of ability to conduct business with electronic documents and digital signatures. Everything was still being done on paper.
Austin says he started spending time tinkering on this problem on nights and weekends. Over a period of months, they began building the software.
Then started selling it part-time. Eventually, it became clear that in order for it to work as a real business it couldn’t just stay as a side hustle.
He explained to his boss that we wanted to take 30 days off to focus on this business. When his boss saw what he created and how passionate he was about it, he told him it was something he should go after full time.
More than that, he became the first investor in Dotloop.
Austin and his cofounder took Dotloop to what he estimates as being involved in 50% of all national real estate transactions as a SaaS business.
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Surviving The Lows & Crises
As with all companies with a great ending, it always sounds like they were an instant overnight success, and that it was easy. Though you can bet every one of them had their daily struggles and near-death moments.
Austin says that Dotloop was no exception to this. Even after striking a strong product-market fit they ran out of money.
He says he had maxed out his own savings and credit cards and they still couldn’t make payroll for everyone.
The day came when he had to let half of the staff go. The other half had to agree to forgo pay until they could make money.
While it was a tough and uncomfortable day that he says he vowed never to have to repeat again, he credits the strong company culture and team with getting through that.
Not just a culture framed on a few values bullet points on a memo, but an engaged team that was aligned in values and achieving the mission.
Fundraising & Acquisition
Dotloop was one of those companies that required scale to really work. It needed to go fast and have a lot of engagement on all sides of the marketplace to be viable.
Scaling meant the need to raise money. They started unconventionally with lots of little checks. It wasn’t until a few years in, with millions of dollars coming in that a San Francisco VC stepped up with real institutional money.
After raising $14M, and several years of building personal relationships with other CEOs and executives they handed off the torch for the mission to Zillow in a $120M acquisition.
Selling the company was never his attention. He thought they would go long and take it public, but the match just made sense for them.
Storytelling is everything which is something that Austin Allison was able to master. Being able to capture the essence of what you are doing in 15 to 20 slides is the key. For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) where the most critical slides are highlighted.
Remember to unlock the pitch deck template that is being used by founders around the world to raise millions below.
What You Do When You Sell Your Company For $100M
After the acquisition, Austin stayed on with Zillow for four more years to help with the integration for his old team, and to keep the companies going.
Then he decided to take a year off and travel. He and his wife even spent several months living in Europe.
They crossed a few fun bucket list items and childhood dreams off of their list. Though he says he really wanted to take a good amount of time to make sure he found the right idea for his next startup.
When he finally was hit with an idea that kept getting him up excited in the morning, he knew he had the right business idea.
The Thing About Second Homes
What kept nagging Austin was that no matter how enjoyable owning a second home was, it was also expensive inefficient, underutilized, and added to housing affordability problems.
So, his latest company Pacaso is working to overcome those challenges. It offers partial ownership shares in luxury properties in places like Napa and Malibu.
They’ve already quadrupled their staff in the last seven months, and have raised $1.7B in debt and equity.
Listen in to the full podcast episode to find out more, including:
- The difference between raising equity and debt
- Austin’s top advice before starting a business
- How Pacaso works
- A new way of thinking about business, the ‘infinite mindset’