Neil Patel

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Karl Jacob has now started and sold several companies. His latest venture has already raised $50M to disrupt and multiple trillion dollar market, thanks to the backing of investors like Richard Branson. The startup, Loansnap, has attracted funding from top-tier investors like Liquid 2 Ventures, True Ventures, Virgin Group, and Reid Hoffman.

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  • The future of the mortgage market


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About Karl Jacob:

Karl Jacob is a serial entrepreneur who has been building, advising, and investing in companies for the last 20 years. He is currently co-founder and CEO at LoanSnap Inc.

Karl’s career has been focused on founding companies that solve big problems, and those companies have helped tens of millions of consumers.

He has raised 23 rounds of financing from investors, including True Ventures, Baseline Ventures, Richard Branson’s Virgin Group, Microsoft, eBay, Integral Partners, Norwest Ventures, Greylock, Benchmark Capital, FT Ventures, Ignition Partners, and Vulcan Ventures.

Many of his companies have had successful acquisitions, including; Dimension X, acquired by Microsoft; Keen/Ingenio, acquired by AT&T; Cloudmark, acquired by ProofPoint and Coveroo, acquired by Zazzle.

While CEO, Jacob has generated hundreds of millions in returns to investors and over $150 million in revenue per year. In 2005 he joined Facebook as one of its first advisors and currently advises several companies.

Karl is a prolific angel investor and mentor for companies including Mayvenn, June, Healthtap, Everlane, Skillshare, Rescale, Memsql, Haven, Shippo, BUILD, Michael Mina Group, and many others.

He holds a B.S. in Computer Science from the University of Southern California Engineering School, where he sits on the board of counselors.

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Connect with Karl Jacob:

Read the Full Transcription of the Interview:

Alejandro Cremades: Alrighty hello everyone and welcome to the deal maker show. So today. We have a very exciting guest. We have a guest that has done it so many times so many times that I’ve lost track I mean it’s really unbelievable. But again you know we’re gonna be talking about building scaling financing all of that good stuff that we like to hear. So without farther ado let’s welcome our guest today Carl Jacob welcome to the show. So originally born in Missouri so how was life growing up, give us a little of a walk through memory Lane Carl

Karl Jacob: Thank you very much glad to be here.

Karl Jacob: A little walk through memory lane. Well I grew up on a ranch and my first job my first real job was actually shoveling crap so you know it’s one of those things that not super proud of but that’ll definitely make you not want to go back there and shovel crap for the rest of your life.

Alejandro Cremades: I Mean that’s pretty unbelievable I mean I guess that you get you got to start somewhere know as they as the same goes how you went to private school and you went to to private school with someone that perhaps you know the listeners may recognize who was that.

Karl Jacob: Um, yeah, so I actually started out in public school and went to public school until ah, the education failed me and my parents picked me up and sent me to private school and that’s actually John Burroughs that’s where Sam Altman went as well.

Alejandro Cremades: That’s Unbelievable. You know so I’m sure that there you guys have been able to chat about that and and he he must be busy nowadays now in your case you know I guess that when we are you know touching on the education subject. Your father was very helpful when he came to. Ah. Give you that that that push to get you into computer science.

Karl Jacob: He he was I was all set out to be a letter of arts and sciences student and my dad grabbed me and took me by the ear over to the engineering campus introduced me to the Dean and that he basically hired me or made me a student right? there on the spot. So I became an engineer within. Like 30 seconds of meeting him.

Alejandro Cremades: Now in your case you begged the Apple representative to get you there and on internship and also you ended up doing the same thing with some Microsystems which you actually went there for your first day full time job. But I guess that that gave you the exposure to to the. Land of innovation and to everything that was going on so how? Ah how was that for you.

Karl Jacob: It was amazing. I worked at the bookstore and had met the Apple rep and had met the sun rep and I thought wow this technology stuff is pretty crazy and pretty cool and so ah begged both of them to get me a job ultimately, that worked out pretty well for me. So my summer internship at Apple was. Really, really interesting and just opened my eyes to what was possible and then working at Sun I actually got to work in the group to end up creating Java and so being in a group of people that are that talented who can literally create anything was a true honor and kind of set the bar for me for my future companies.

Alejandro Cremades: Now with some microsystems you were there for a couple of years and you know eventually you decide that it’s time to pick up the phone and notify your mom of something that she would not be very excited to hear.

Karl Jacob: Yeah I told my mom that I was leaving to start my own company and she cried she said she begged me to stay in the job and told me why would I leave a perfectly good job. Ah I’m glad that I didn’t let her talk me into that.

Alejandro Cremades: So What was that process because I mean obviously see you know you came from from shoveling like you said crap to all of us Sudden. You know you’re here you know a nice you know, ah job with a steady income your parents you know, super thrilled you know with that day with that with that environment that you had created for yourself. So What was that process for for you to to think hey you know maybe this is not for me. Maybe I want to start something on my own and give my notice.

Karl Jacob: Yeah, it was pretty easy for me I I remember going to my boss at the time and saying hey I think I’m ready for the next level and he said hey I just promoted you last year. You can only be promoted so much tough. Just waited out. That’s the way it works. You’re in corporate America and I thought well. Then corporate America really isn’t for me.

Alejandro Cremades: So then show then what happened next.

Karl Jacob: Well, we started a company and you know that was a great experience. Learned a lot ended up being kind of the platform from which I started my my first real company which is to mention x which I founded actually in my apartment in San Francisco and it’s funny I remember. Having to ask for them to run a t 1 line meaning I and telecommunications line into the apartment because all I had were basically phone lines that was 1995.

Alejandro Cremades: Now What year was that.

Alejandro Cremades: I mean I’m sure that things have changed quite a bit and and and funny enough that company was your first angel investor was Ron Conway and you know I’m sure those were the early days you know for him to of of ah placing some some tickets in some company. So. How was it like to to have Ron Conway you know back you here because I know that he also played a pivotal role when he came to the acquisition of the company.

Karl Jacob: Yeah I mean Ron wasn’t ron back then I mean he was just becoming Ron and so a lot of it was. We were both learning but he had a lot of really great advice I think one of the biggest was helping me with the decision as to whether or not I should sell the company and he drew a curve on a whiteboard that basically showed. Where I was today and how much I would make and and more importantly, how much the team and the you know people who were shareholders in the company would make and then if we raise more money how you kind of have to spend the next five years building value to get back to the same place that you are. Today and so when when entrepreneurs think about raising money they often don’t think about the fact that that’s usually dilutive. Well it is dilutive and so you have to create a lot more value to realize that and that’s not just important. Personally, it’s important for your team and your shareholders.

Alejandro Cremades: And what was that journey like of um, you know Microsoft I mean unbelievable company. What was that journey like of going through that acquisition and how how it happened and what kind of visibility did it give you into the full cycle of of a company.

Karl Jacob: Yeah, well it. It was interesting because I’d Bennet’s son but I really when it came down to choosing who was going to bias I chose Microsoft because I wanted to learn Microsoft at the time was probably the best consumer software company on the planet that was about ninety ninety seven so they were pretty legendary. I learned really early. Great deal tactics I remember that both son and Microsoft were wanting to meet with us during the acquisition and I remember the guy from Sun saying hey how about if we come tomorrow Wednesday which was the day and I said I can’t do Wednesday I can do thursday. Well, he brought his entire deal team down from Redmond Washington Wednesday and was sitting in my lobby right? when sun micro systems walked through the door to do the meeting that I had basically pushed him off for super great tactic right? because. Put a lot of pressure on me and it also made son know that hey there was somebody else at the table and they better get their act together. So ah, one of the truly defining moments in my career is seeing that kind of deal making acumen right up and close.

Alejandro Cremades: So obviously you know the the deal ended up happening and you ended up getting a acquired by Microsoft so as it comes to now building scaling raisingcing money and then all of a sudden. The companies is Acqui I mean. What kind of disability did that give you.

Karl Jacob: But definitely teaches you a few lessons I think the biggest when you’re at Microsoft you realize that these big companies that have made so much impact were all startups at one point even Microsoft and so I got the chance to learn from the executives during the executive training program kind of the end of that program is. Actually get to hear the story of Microsoft from the founders which was just mind blowing to think they were that small and I think that’s the important thing for entrepreneurs to remember everything starts small everything starts with an idea everything starts with a few people and grows from there or not and so. This idea that they all start like with the success already happening or with the winds behind their backs I have never found that to be the case.

Alejandro Cremades: Now for you after the transaction happened then you became an entrepreneur in residence for a benchmark and that was the a segue that would take you to your next company Kan. So. What were the sequence of events that needed to happen for you to bring into life.

Karl Jacob: Well I get recruited by benchmark to be an entrepreneur in residence which I had no idea what that meant other than the fact that I’d always raised money from non-institutional like angel investors and so I really had heard about this vc stuff but I didn’t really know what it was all about and so joining benchmark was. My way of learning and and kind of getting to understand that industry better. The my job was effectively to get paid to come up with ideas which I remember Bob kegel a couple times said. Okay, great. Great idea, put that in the drawer and then come up with one a new one tomorrow which. As an entrepreneur I was like well wait that is the idea he’s like no no, no, you need to go through a process you need to look at a lot of different things and I don’t think many entrepreneurs get the opportunity to do that or do that and I really highly recommend that like your first idea is not necessarily your best idea or the only idea that you’ll have and. Time is really the most precious thing that you’ve got so spend it on something that you have really thought through all the different issues and are giving yourself the biggest and best opportunity to be successful before you go raise money before you recruit a cofounder or other people into the company. So that process ended with kind of an idea and a group of people we had a team already working on it at benchmark and that was kind of a unique one because they had found someone else or 2 other entrepreneurs had been working on a similar idea and we ended up putting the 2 things together which which created the company.

Alejandro Cremades: And what were skin doing.

Karl Jacob: So Keenan was interesting if you think about ebay as being for stuff that’s in your garage keen was for stuff in your head so selling everything from psychic advice to legal advice to medical advice you you name it and in fact, Jeff Sk goal from ebay was on our board. And he taught me a tremendous amount about marketplace dynamics and I also learned a little bit about sticking to your guns a keen when we started out. We really focused on transactions and in ninety nine that was really not popular at all. Everybody was giving everything away for free and hoping they’d pay for it with advertising but we stuck to our guns and ground it out through the dotcom implosion through 119 turned the company profitable and then sold it to at and t and I think it’s just a great example as an entrepreneur. Don’t follow the prevailing wins. You know, know that your true north is a little bit different and stay focused on your core values which in this case was focused on this idea that look if somebody will take their wallet out or their credit cut out and pay for the service that is value versus giving it away for free and hoping the advertising will you know.

Alejandro Cremades: And what about cycles because I mean as you were saying you were able to survive. You know they’re the dot combust. You know there were so many companies that were folding. You know at that point and the fact that not only you were able to survive but you know be able to later on you know, sell this to 18 and t a transaction that was north of 300,000,000

Karl Jacob: Save the day.

Alejandro Cremades: It’s pretty impressive. So in terms of insights towards you know market cycles and macro environments. What were your takeaways from that experience.

Karl Jacob: I think the biggest takeaway symptom I’m seeing right now build a profitable company as fast as you can runway doesn’t really matter unless it’s on the way to building a profitable company and so when you I heard the other day. A company say that they had 9 years of runway I don’t even know what that means. Right? At the end of the day. The goal is build a profitable company as fast as you can Ron Conway would would reiterate this. He’d say so you control your own destiny Steve Jobs did it at Apple and you look at the great companies. Are you know, marked it it at Facebook. Build a profitable company and then you control your own destiny and you is like the wider corporate you you’re just not controlled by investors or outsiders you can chart your own course which oftentimes is really important and counter to people’s overall feeling about where the company. Should go or their instinct. Great example that with Facebook was staying inside of colleges or or going outside of colleges and opening it up to the world that was a hotly contested decision inside of Facebook which probably would not have been well may or may not have been made depending on the investors we would have had.

Alejandro Cremades: Now for you second company second exit. You know you were on a roll. Um you know and Asana an entrepreneur always an entrepreneur. So I guess in this case, you know after this transaction to at and t why did you join another company versus.

Karl Jacob: Um.

Alejandro Cremades: You know, launchging another one over your own because you join you know the folks at the cloudmark.

Karl Jacob: Right? Well so I actually they brought in a quote professional Ceo at keen so it was a little bit of it was a little bit before the eighteen t transaction. Um, you know I was pretty young and pretty greener as my dad would say wet behind the ears and so I was just not. Yeah I was not an appropriate Ceo for where the company had got to according to the investors. Um, and so I been on a board I thought you know been working with a couple of companies cloud market being one of them and they said hey why don’t you come be the interim Ceo we need somebody. And so I did and again an example of kind of learning a lot and you know being exposed and and open to trying new things and joined vipple and and Jordan in that project.

Alejandro Cremades: And in that project I mean you guys ended up selling it to a proof point but looking back I mean what was the lesson that you had to learn because I mean obviously you know with Cloudmark it didn’t take long I mean it was like a couple of years you know before the transaction happened so during that time you know what was that lesson that you took with you.

Karl Jacob: It’s interesting. It may look like that it actually took took quite a while is about 8 years and so cloud Mark was yeah I mean another example, stick to your guns. You know that company was profitable for probably 4 years up until the transaction happened.

Alejandro Cremades: Um, oh wow.

Karl Jacob: And so it could kind of choose its own destiny and choose its own ah approach which became critical because that space the security space in the enterprise space became quite difficult over time and so being profitable was really helpful and in fact, it helped me encourage the company. To turn down the first acquisition offer which was a terrible offer. It was a terrible offer for the investors terrible offer for the shareholders and I decided that wasn’t something I could support particularly because I had a lot of friends who were still at the company and were people upset particularly the. Current investors. They thought that hey this is a great deal. They were going to make some money their funds were kind of at the end of their their lifespan but we we you know I have to say ah to our credit held our ground and they ended up selling the company for quite a bit more two years later

Alejandro Cremades: Nice now after this you took some time off and then one day you receive a phone call from Sean Parker at the Facebook tell us about this.

Karl Jacob: Um I did yes, yeah yeah, well it was at multiple phone calls actually because I didn’t answer the first few so and he said hey you’ve got to come to San Francisco I said well I’m in Cosamel.

Alejandro Cremades: Ah.

Karl Jacob: I’m kiteboarding and I’m taking time off I’m not going anywhere. He said trust me, it’ll be worth it and you know Sean had a good instinct for stuff like that and so in the middle of my kiteboarding trip I got on a plane flew to San Francisco met with Mark At University Cafe and by the time I got back to cosaml I had the agreement for me to be an advisor in my email.

Alejandro Cremades: And what did you see you know in the company and and also Mark Zuckerberg because I mean now it’s incredible like what he has built. You know the legacy and the level of impact of Mark Zuckerberg that that the world knows today. But. But what did you see there that you are like wow this is this is interesting.

Karl Jacob: Um, I think the biggest thing that I saw was Marcus Cognitive sciences that was his background and mine was biomedical engineering and we we really saw eye to eye on this idea that if you could build something that would help humans connect that you would have something special and so. I didn’t know what it was going to be I don’t really think Mark did either to be honest I think it was evolving at the time but that was the core of it. It was like just kind of being aligned on where things could be one day and that we could use technology to help people improve their social connections with each other. It turns out it was much much bigger than we thought and that’s kind of one of the things I think people forget is that every idea starts very very small particularly the good ones and the idea that people knew back then including Zuck that Facebook would be something that everyone in the world. Pretty much would use is just not true like no entrepreneur knows in the beginning they hope they dream. But the idea that that they knew that they were going to connect the world. That’s just not true. That’s one of my favorite stories I I saw some investors.

Alejandro Cremades: And why no one wanted to give the money at that point.

Karl Jacob: Or who could have been investors in Facebook and they said everybody has you know hindsight 2020 and revision his history right? So the funny thing was well. You know too bad that didn’t work out I said well you guys just turned this down It’s not too bad. It didn’t work out. You actually just turned this down. Well yeah, but you guys said you would never go outside of colleges. And you guys said this and then there’s always an excuse and I think that you know that’s kind of the interesting thing so we would say hey this is going to stay in colleges and Sean was adamant about that is adamant that it wouldn’t leave colleges and to a t that was pretty much the number 1 reason people turned us down and we pitched to everybody. The idea that Facebook just magically got money is completely ridiculous. We pitched every vc in the valley and pretty much every vc in the valley turned us down.

Alejandro Cremades: Wow. So then what? what do you? think you know needed to happen in or for something there to click and and to get money.

Karl Jacob: Well obviously Jim Breyer at excel clicked and and gave us money which was interesting because we were 1 of 2 consumer plays the fund had at the same time in excel was not doing great at the time you know they were they were definitely in ah at an interesting inflection point. In their fund which Facebook helped create over time. Um, it just took somebody to believe and Peter Thiel and Jim Breyer and they believed in I think mostly Mark and the team right? I mean I think really at that that point that was the bet and that they would figure it out and ah. I don’t think any of them do what kind of ride they were in for I certainly didn’t.

Alejandro Cremades: And obviously the rest is history now in your case, you know you continue your journey of of building nonstop you know and launching companies. You know they like the next one actually was wall up and that is a very good example of how an economic you know? ah.

Karl Jacob: In here.

Alejandro Cremades: A scenario or situation really ah pushes to do um pivot and then obviously you know like into an acquisition into a nice outcome. So what happened there with wallop and and how did that pivot you know come about as well.

Karl Jacob: Yeah, so necessities the mother of invention. My father is to say and I think that’s very true in that case I remember wall of was a social network that we built and kind of I’d learned a lot at Facebook and and they said hey we’re never going outside of college I said well okay I’ll I’ll go outside of college. And you know it’s also an example of don’t spin out r and d projects out of big companies that was a r and d project at Microsoft that we spun out which was a mistake but we’d learned a lot about people customization. People’s desire to be different so I’ll never forget when the economy hit the skids. And went to the board and I said hey this one is going to be tough to make money in this environment really tough and I actually offered a couple different options and I’ll I’ll give you 2 of them one of them that’s pretty hilarious. So one of them was customized phone covers which is what we ended up doing. Physical transactional and all that the other was an Iphone app and I’ll never forget the response that thing is just a toy. It’ll never be a real phone. Forget about it. Yeah well you know it cover ended up being great.

Alejandro Cremades: Wow.

Karl Jacob: But have been fun to build an Iphone app too before anybody else did but you know you never know.

Alejandro Cremades: So then so then in this in this case cover you guys ended up a selling it as well. So I guess saying what was the lesson for you to to take from that experience.

Karl Jacob: Well, that another lesson was really if you build a profitable company or close to profitable company then you control your own destiny and so that company could just keep on going on as long as they needed to I think Paul Graham said it best means that your your goal is to be default alive and. I think that’s very true if you’ve got a real business if you are just trying to keep something alive for 9 years you’re actually a zombie. You’re not really alive, you’re just you know, walking through the wastelands somewhat lost. With with no direction and no ability to get to that profitable company that then allows you to do the things that you’d that you’d really like to do so so similar theme. We just stuck to our guns we. There are a lot lot of different things that happened everybody went from blackberries to iphones during the tenure of that company. Just stuck to this idea that hey people want to express themselves particularly through their phones.

Alejandro Cremades: The next company that you did that was Hank time now. 1 thing that I was saying interesting. There is that you almost sold it twice and you ended up folding the business I mean I’m sure that was painful.

Karl Jacob: Yeah, yeah.

Karl Jacob: Yeah, super painful I don’t I hate losing.

Alejandro Cremades: Ah, but what what happened I mean how come you almost sold it twice that didn’t crystallize and then all of a sudden you end up, you know, having to turn off the lights.

Karl Jacob: Well I think that one was interesting because is ah a good example of a great idea I mean being able to show people what is possible to do around them from hundreds of millions of events was a fantastic value proposition for consumers. Problem was super hard to make money there right? You could try to sell tickets and take a cut of that but that industry is pretty messed up. You could try to like sell Merch again issues around that and so 2 things happen 1 be careful who you’re dependent on because we actually used Facebook as our. Base for a lot of those events and they they basically shut that Api off even to us which I think was the right decision long term but definitely hurt our business. So be careful. What platform you build on and make sure it’s a platform and on the deal front. We had one that fell through which I’m actually pretty glad that it fell through it just it. But not have worked out that company. It didn’t go out of business but Dan close and then the other one I was really excited about it. I was actually my bags were packed going to move to l a go run products for the company and I remember getting yet another phone call from the Ceo O at the time. Hey we’re we’re we’re pretty much there. We need to change 1 more thing and that’s when my deal instinct just kicked in I said yeah this is not a good environment for us to go into. Thankfully we didn’t take that deal because the stock price plummeted from there not from there on but about a couple years later

Karl Jacob: And it’s never recovered and the company’s never recovered now could we have helped maybe right because I think it would have been an interesting tie up and we definitely saw the same vision around events sometimes in deals you got to know when to walk away even though it means you got to turn the lights out and. Really let it go which was super hard for me because that that that had never really happened to me.

Alejandro Cremades: And how do you know when it’s time to walk away.

Karl Jacob: Well like my dad said the light at the end of the tunnel can either be a light or an oncoming train and that one was an oncoming train I think part of it is recognizing that at certain times in a business There’s just too many things stacked up against you and. You don’t have quote real traction. You know entrepreneurs are a funny group. They’re very optimistic and everything looks great. Everything’s always great. Well this this conversion is getting better that conversion is getting better. What I think we realized is that we had a great app. A great consumer business. Oh. Create consumer product that people love and a revenue model that wasn’t going to work and so we had to tie up with somebody else in order to make that work and that just didn’t work work out for us. So so I think it’s like knowing it’s it’s a gut instinct thing but it’s also a little bit about you know. How much longer are you willing to to try that one. We probably should have stopped earlier and we in some ways re lied to ourselves. You know we just like oh just 1 more feature just 1 more thing and when we finally turned that corner. It was too late which is really too bad and then Facebook pulled the plug on the api for us and. Then things went pretty south from there.

Alejandro Cremades: Now before we talk about your latest one you know which is a rocket ship you know during the yeah during this course of time I mean over ah 2024 years or so you’ve also been investing. You’ve been an angel investor you’ve invested in over 35 companies what are the 3 trades.

Karl Jacob: Um.

Alejandro Cremades: That you’ll find on those founders that you’re like I gotta invest in in in in in this individual.

Karl Jacob: Well that you just said it. The individuals right? So so the first thing I’ve learned is regardless of what you think about the idea invest in the individuals because they’ll figure it out and that was true at Facebook that was true at June true at Everlane over and over again even true for the ones I missed. I missed Twitter I could have invested in oio and I passed and odeio turned into Twitter and I asked the entrepreneur I said hey how come you didn’t call me back I was the one who wrote down my feedback and said I didn’t he’s like to have you ever called back? an investor who said no to you I was a. Was a good lesson. So I think that’s one I think 2 is if you do agree on the idea then part of it is market size and product not so much because you think market size and product for that particular idea are the right ones. It shows you how the entrepreneurs think and if it’s like oh well, the market’s $50000000000000 and we’re going to get point zero one percent of it that is not a market sizing that I believe in if it’s like hey we’re going to start at x and grow it over time. Here’s our conversion rates here’s our monthly active users here’s our daily active users here’s our returning users which is a more important metric here’s how many people share the product with their friends. That’s the kind of stuff that that I that I look for.

Alejandro Cremades: Nice now. Let’s talk about your latest company obviously Carley is nonstop never stopping. So let’s talk about a loan snap. So what do you guys have to with loan snap in and why did you think that the problem was meaningful enough for you to take action.

Karl Jacob: If.

Karl Jacob: Well, it’s interesting I remember the day when I realized that the mortgage industry is $13,000,000,000,000 industry and it had not been disrupted yet and thinking if I was an entrepreneur I was giving advice to I would tell them go do that right now and so I had to take my own advice. And so we started. Ah you know, kind of as you pointed out to rocket ship now. But boy. It’s not been an easy road $13000000000000 industries that haven’t been disrupted haven’t been disrupted for a reason and that’s because it’s super complicated. There’s many people in the ecosystem. And you have to solve a lot of problems at the same time. This is where a lot of my experience in the past has have come together I’ve solved the beginning of the problem. The middle of the problem and the end of the problem you know backend piece the front end piece in my career I’ve never done it all at the same time and that’s that’s what we’re doing here and until I’d say. late last year we really didn’t have it all put together now it is and an environment where most people are really struggling particularly in the mortgage space. We’re actually doing quite well.

Alejandro Cremades: So for the people that are listening to get it. What is the business model of Loan snap. How do you guys make money.

Karl Jacob: Oh we have to have a business model just kidding. Yeah, so so it’s pretty easy. We make loans. So we’re an originator and then we sell those loans to big financial institutions governments banks and and funds and so we take a cut of that transaction. Pretty simple. However, it belies the complexity there because the industry has been around for many many years and been so massively profitable. No one’s had to make it efficient until now because higher interest rates are definitely not great for your regular mortgage company. So not only do we make money that that way. Right? But we’re also starting to build the infrastructure to be able to make money at the different points in the loan process and even selling the loans and even balance cheating them meaning holding the loans in some cases. Ah, that’s where a whole bunch of the tech stack and there’s Ai involved we were doing ai theft like two or four years ago now everybody’s finally caught up. With us or I haven’t cut up but they’ve caught up with them are on their marketing front. Not not necessarily with the tech front the blockchain and there’s a lot of interesting things going on there and so it’s been interesting to kind of see this ecosystem. That’s been around for so long like insurance was before insurance and other companies. So desperately in the need of change but because they’re so profitable on the business models that they have they haven’t needed to change and until someone forces them to and that’s going to be us.

Alejandro Cremades: Now. Also for this you have raised some money I mean and you’ve now done it so many times that I’m sure it was not that difficult to raise money. But also you’ve been on both sides of the table. So I’m sure that you were quite picky.

Karl Jacob: Yeah.

Alejandro Cremades: Selecting the people that you are going to bring on board as investors. So why did you choose the people that you did on the a round that you did on the B round that you did and then also just just to start off how much capital have you guys raised too late.

Karl Jacob: Just over 50,000,000 in capital raised and you’re right I mean I’ve raised 23 rounds of financing. So I mean personally for my own companies I don’t even know what it is for other companies and so I think that the. Goal that we had when we started this company was we knew it was going to be a long term play. We knew that we needed long-term thinking investors and that’s really why we chose true ventures and baseline just two firms that have just stood the test of time and are focused on long-term benefit. And supporting companies that get back I mean our companies saved our customers $80000000 last year like we’re focused on value to consumers. Not necessarily giving them a loan that takes advantage of them I think those times are gone well I’m hoping to put an end to those times. In in the financing industry particularly in in mortgage. So we needed investors who were aligned and we would basically test them. Are you okay, with there not being any kind of outcome for 7 years or more and that’s important because it’s two years past the life of most funds. And when the answer came back. Yes, then we knew we found the the right people then it turned out that we found more and more those so richard branson put money in after that peter thompson who started thompson reuters and then a bunch of other like-minded individuals who are more focused on.

Karl Jacob: Ah, long term who understand that if you’re going to disrupt these massive markets that have not been disrupted before it is not going to happen overnight.

Alejandro Cremades: So obviously to these investors you had to share a compelling future and a vision. So imagine you were to go to sleep tonight Carl and you wake up in a world where the vision of loan snap is fully realized what does that world look like.

Karl Jacob: That world looks like a world where we’ve saved our customers billions of dollars and instead of having a loan or loans that they hate and they don’t understand they have loans that they love that have helped them achieve success in their lives. However, you define it whether that’s starting your own business or sending your kids to college or remodeling your house and in your own language meaning without all the financial jargon thrown at you. So yeah, hopefully it’s a world where your financial partner is a partner and trying to help you. Versus working against you and take advantage of you as we’ve seen in the last well 50 years

Alejandro Cremades: So obviously here talking about the future but let’s talk about the past now and doing it with a lens of reflection. So let’s say I put you into a time machine Carl and I bring you back in time maybe to that time that you were at Sun Microsystems you know wondering like what you would do of your own. And let’s say you know you had the opportunity of sitting down that younger Carl and giving that younger Carl one piece of advice before launching a company but would that be and why given what you know now.

Karl Jacob: I think the advice would be don’t stop. You know I think the thing that is hard at that point is going for it and doing it and not stopping and giving it giving it your all. Remember when I left Apple Steve gave me a really good piece of advice and I’ll just kind of like compress it for this It’s definitely not 1 of the Steve Quotes you see attributed to him. He said you know what? you’re only young enough and dumb enough and poor enough once in your life to really go for it. He said so. Go for it and I did I left and you know that was kind of the the thing I held with me in starting my own company was like hey I mean I I didn’t have a mortgage. You asked me that I didn’t have car payments or kids or a family or anything like that and so that was ah that was a big opportunity. To to be able to try something totally crazy that my mom cried over right? Ah and and have it turn out and that’s a very rare time in your life when that’s that’s possible.

Alejandro Cremades: Wow Carl very profound now for the people that are listening that will love to reach out and say hi. What is the best way for them to do so.

Karl Jacob: Well I’m at Carl at Twitter which gives you some idea of how long ago I started playing around with with Twitter or Carl Jacob at gmail k a RLJACOB at

Alejandro Cremades: Amazing! Well hey Carl thank you so much for being on the deal maker show today. It has been on on earth to have you with us.

Karl Jacob: Well thank you for having me. It’s been great to be on the show.

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