Marnix Broer On Raising $50 Million To Create A Note-Sharing Network For Students

Marnix Broer is a Dutch businessman who has continually found entrepreneurial opportunities within the environment around him. His love for business has been seen since his childhood when he started selling old nails to his neighbors at a young age. His current business grew from a challenge at college that ended up spiraling to great success in the Netherlands and Europe. StuDocu has successfully raised financing from top-tier investors like Partech, Piton Capital, Point Nine, and Peak.

In this episode you will learn:

• How to scale a project to a viable business
• Leveraging friends and classmates to create a team
• How to get funding from investors without appearing too desperate
• How to handle fast growth
• How to incubate a business while studying
• His future vision of the company

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For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.

Moreover, I also provided a commentary on a pitch deck from an Uber competitor that has raised over $400 million (see it here).

Remember to unlock for free the pitch deck template that is being used by founders around the world to raise millions below.

About Marnix Broer:

Co-Founder of StuDocu, Marnix Broer is on a mission to build the global community for university students to excel in their studies and in life. He studied mechanical and offshore engineering. Nowadays he is busy with finance and business intelligence matters.

Connect with Marnix Broer:

• Crunchbase
• LinkedIn
• Twitter
• Facebook

Read the Full Transcription of the Interview:

Alejandro: Alrighty. Hello everyone, and welcome to the DealMakers show. Today we have a founder, a very interesting founder because he’s from Europe, and I’m a little bit biased because I’m also from Europe myself. But it’s definitely a different market, a different way of adapting to the global side of things, and different than the way founders in the U.S. or investors in the U.S. see things. But it’s really nice when it comes to blending together, and I see those startups from Europe making it happen globally. So I think that we’re going to be learning quite a bit there, and then also how this started out of having multiple discussions with roommates and how things started evolving and transforming. I think that we’re going to be learning quite a bit today, especially, as well, when it comes to raising capital. So without further ado, let’s welcome our guest today. Marnix Broer, welcome to the show.

Marnix Broer: Hi. Thank you, thank you.

Alejandro: Originally born in a small town there in Amsterdam, so tell us about life growing up.

Marnix Broer: Yeah. I must say, it was pretty nice there. I had a lot of nature around me, some water, and I could spend time in a boat. Everything was close by, including the big city, Amsterdam, so it was a good life.

Alejandro: And being born there, as well, in a busy and crowded family. Is that right?

Marnix Broer: Yes. I’m the youngest of four kids, so there were many fights, but also fun times with my brothers and sisters.

Alejandro: And also very much an entrepreneur because you were at a young age already thinking about ways to monetize and make money, and everything, from grabbing nails out of wood to soap. You had it in you.

Marnix Broer: Yeah. Those are things that you think about later. Of course, back then, you didn’t realize, but when I hear the stories from my parents now, indeed, I was selling old rusty nails, which I had straightened and then sold them to the neighbors. But I also learned my hard lessons. I remember cleaning the cage of the rabbit of my sister, and after a while, she kept paying me for the first year, and then she convinced me to own the rabbit. So I thought, “That’s nice. Let’s own the rabbit.” But from that moment on, whenever I cleaned the cage, it was my rabbit, so I didn’t get paid anymore. You also learn the hard lessons when you’re young.

Alejandro: 100%. So why engineering out of all things? What got you into that problem-solving type of mentality?

Marnix Broer: These things kept exciting me from quite young onward. I liked to build stuff from small boats to disco lights, but also, I must say that the shows on the Discovery Channel, especially the past—nowadays, it’s way too much marketing and blah, blah. But back then you had really nice shows on the Discovery Channel, and that convinced me to also study in this field.

Alejandro: While you were in school with your roommates, definitely, there were a bunch of conversations that really changed the course of everything. What were those conversations?

Marnix Broer: Yeah, it did. When we were studying, I lived in a large student home. We were there with 13 guys and a lot of fun. Of course, you had to study, but also a lot of partying and making fun. But we missed something, and that made us decide to say, “You know what? Why don’t we start something? Whether it’s a company or project, who knows but at least let’s give it a try.” Then, of course, you need an idea. That one is pretty tricky, so the plan came together where I said, “What if we pitch an idea every day to each other. It can be very small; it can be very lame, it doesn’t matter. You have to pitch something, and then after a month or so, we’ll decide on what the best idea is, and let’s give it a shot.” But after two weeks, my friends and roommates actually had a very nice idea. That idea became the current company, eventually, but when he told me that, I was like, “Let’s stop thinking about new ideas; let’s stop pitching because this is the one. This is what we’re missing, and we feel the pain every day while studying, so why not solve this pain and make a company out of this?”

Alejandro: So what happened next?

Marnix Broer: Even the same night, we started drawing how it would look, and in fact, the only thing he said was an online place where you can drop your notes, and other students can start using those notes. That was, indeed, exactly the pain we had and experienced it with every exam season. You got to gather for a couple of days from all your friends, roommates, people you know, people you studied with. Do you have some notes? Did you go to this lecture? Do you have a summary of this book? All those things you had to gather took some time and sometimes the information was also lost. So we felt, why isn’t it possible to go online, go to that one portion you’re going to study for these exam sheets and see what everybody has made available already to study with. That’s also how we started drawing it. It was very simple. It should look like your folder on your computer. Simply choose your study field. Simply choose the course you’re taking this semester. Then once you click it, you can see an entire overview of all the documents which other students have already shared. So we made this light design and drew it on the kitchen table, but then you have to develop it, of course. That was tricky for us because both Jacques and I had no idea how to code. We were like, “We can’t learn this quickly, so let’s get help from outside.” Luckily, a friend of mine who I’ve known since I was two years old, really long ago, always made websites as a side job. So we asked him, “Could you make a website for us, and it has to look like this.” He said, “Yeah, I can do that. No problem.” He built a website, at least we thought he built it, but actually, he outsourced it also to a roommate of his, who together built the first version of the website. When we started asking for the next versions to improve the page, he then admitted that he was actually not the only one coding, but also his friend and roommate were also coding. That made us decide, “You know what? Let’s stop paying these friendly prices. Let’s go together and make this one company so that we’re four founders going from here.” That worked out really well for us.

Alejandro: One thing led to the next, and then also to a rebrand, too, as you guys were naming the company. So talk to us about that.

Marnix Broer: Yeah. At first, we only thought of a small project at our university. We chose a Dutch name, and I can tell you the name, but I guess many can’t say it, but it’s StudeerSnel which actually means study fast, but in Dutch. This name, especially with the dot and L rhymes, was a nice catch and to keep people reminded when they study. It worked nicely because within weeks at our university, many students started using the platform simply because we had the platform online, and we dropped all the notes we had gathered in the last four years online, so there was a lot of material that students could use from day one. Within weeks, people in other cities also started asking, “Can you build this platform for us as well because it’s super useful?” I’d say, “No problem, but we need some set of notes to get a kickstart, so if you can share all the notes you have gathered in the past with us, then we’ll make a page, upload it, and we can start spreading the word that you’re in the university as well.” Then we kept doing it in the Netherlands, actually, because we saw more and more students using it. We knew that this was something bigger than just a small project. We decided to start scaling it throughout the Netherlands. However, the Netherlands is not that big, and also the number of universities is not that many, so after a while, although doing it part-time, quite soon we realized that we had to go across the border because there weren’t enough universities anymore to go to. Yeah, you picked out the deduction game, which no one in Germany or elsewhere can pronounce, so we had to pick a different name for that, and that’s how we came up with StuDocu, which, in fact, is also just an abbreviation of Study Documents. I remember two of my founders found the name very lame. We said, “You know what? We think this is the best name. There are almost no URLs anymore, so if you come up with a better name in three months, then we’ll take that one, but otherwise, we go for this one. In the end, it remained StuDocu.

Alejandro: For the people that are listening and watching, what ended up being the business model? How do you guys make money?

Marnix Broer: At first, we didn’t, especially in the first years. In the Netherlands, we grew very fast, of course, but we had a free product, and it’s rather easy to sell free ice cream, I think.

Alejandro: No kidding.

Must Read: Reuven Aronashvili On Raising $140 Million To Change The Paradigm Of Cyber Security

Marnix Broer: Ray would say, “Of course, it will grow fast because you’re not charging anything.” In a way, he would say, “You have a great product/market fit. The numbers go up really well.” On the other hand, as long as people are not willing to pay for it, you can’t be sure that people still really like it. But for us, the reason why we implemented this model was actually that our graduation was near because we founded it during our studies. So we had to choose: do we want to continue with this company, but then, if so, we need money because we don’t have a career then, and we need to pay our rent and be able to buy food. Or we stop the project, and we go for a career within a company and work for someone else. Of course, we liked our own company much better, so we said, “Let’s at least give it a try to make a business model here. So we decided because we were a bit afraid. At first, we decided to not lock all the documents behind the payroll, but Bubba said, “We’re going to lock 20% of the documents behind the payroll. And to make it even better, if people want to upload instead of pay, that’s also fine.” You can also grant yourself access by uploading your own resource. That was actually a golden idea, which we didn’t know back then. We also didn’t know yet what A/B testing was, so we just implemented it to see how it would go. But within seconds, people started paying for our service. But, even better, what we found out later is that a lot of students started uploading their resources. That, for us, meant tremendous growth because from that moment on, the inbound of new documents was so much faster and so much higher than we ever had seen before that suddenly, we added so much value every day to the platform that our company started growing much, much faster. More and more students knew about us and started finding us on Google. In that sense, we made the best decision ever. But it was a tricky one because nowadays, we would never do anything properly without A/B testing.

Alejandro: Tell us about raising money, too. How much capital have you guys raised to date?

Marnix Broer: In euros, let’s say around $46 million.

Alejandro: $46 million in euros. I don’t know the conversion rate right now, but definitely over $50 million. Let’s talk about what that process has been for you guys to raise that money, and what had been the expectations because, obviously, raising in Europe is not the same as raising in the U.S. There are different mindsets, different approaches from investors, too, and also the perspective from the founder. How has the fundraising journey been for you guys in raising that money?

Marnix Broer: I always find fundraising quite nice because I’m not too afraid to sit with strangers, let’s say, with the investors and then tell the story and convince them that it’s a great business. But it is time-consuming, of course. But, indeed, like you said, Europe raising is definitely different versus the U.S., and I think especially on the part that you should really show product/market fit before raising cash. You might be able to do the trick of raising money before product/market fit, but that will cost you a lot of your shares. So I would not recommend that. What I would always recommend when raising the first round, I would say, whether it’s a university, city, or neighborhood, try to find a definable location and audience, and say, “We managed to convince these people to start using the product. They like it, and we’re now scaling it to more neighborhoods or more cities.” That way, you’ve made proof in one small area, but that shows to an investor, “These guys perhaps are not making loads of profit yet. However, they did prove that at this neighborhood or this audience level, they have product/market fit. So why not expand this and scale this to many more places.” We did a similar thing because we had universities to prove this. For us, though, we had the universities in the Netherlands, but for us, it was really important to show to the investors that also universities abroad would be able to scale it. That’s also what we did before raising. We tested a few universities in Belgium, which is just below the Netherlands, and they speak the same language there, so it was easy to go across the border. But we also said, “Let’s challenge ourselves, and let’s also pick a few universities in Spain to see whether we can manage to launch a business in an area with a language we don’t speak. We’re now based in Amsterdam. What about launching a university in Melbourne? Would it be possible to get students using the product there as well?” That’s just to prove that you don’t have to physically go to that university and get the business started. For us, luckily, that worked, and that was, for us, enough proof case to get to the investors and say, “This is really promising. You now have the opportunity to invest.” Luckily, we created quite some FOMO while here in Amsterdam. Many investors here, I would say 15 to 20 perhaps. Luckily, a few were interested in investing.

Alejandro: How does that FOMO, fear of missing out—believe it or not, the guy that coined the word, Patrick McGinnis, is a good friend. So what a word: the fear of missing out. So, the fear of missing out, FOMO, what has been your experience of generating that FOMO? How does that work?

Marnix Broer: I think it works simply by showing that you’re really confident. At the moment you speak with investors, you have to give them the feeling that you don’t need the investor. If they say no, fine. You have someone else lined up. So, no worries. That, of course, is much easier if you have, in fact, more investors interested, but it does mean that you have to start talking to a couple of investors, hopefully convey the story well, and in that sense, get some people interested. That also means that the next conversation you have with any of the investors, you can sit down with much more confidence knowing that there are more people interested, and they will read that from your eyes, and how you move, and how you speak, and that you’re not nervous, or your voice is going up and down. They will feel: these guys are in a great position, and we’re not the only ones who want them, so we have to act quickly. We have to offer them something nice. If you’re a really good actor, let’s say, then you can manage to do this without having more investors. Luckily, we were in a position to also, in fact, have more investors interested.

Alejandro: In your guys’ case, one of the co-founders left. How do you deal with that?

Marnix Broer: Well, he left after quite some years, I must say. It’s a position, at the beginning, that you definitely don’t want to be in simply because you’re feeling like, “Oh, ****. One of us is leaving, and what will happen? What will the team think? What kind of gap will this person leave behind to fill again, and can we actually find a good replacement for this founder? So that was kind of tricky, and I’m glad that, in our case, the co-founder who left was mainly responsible for tweaking the growth model, and luckily, we were at a stage where we’re scaling rapidly, so tweaking a growth model wasn’t that important anymore at that moment. It was more about scaling it to more and more universities over the whole world. So that made the gap he left behind manageable to capture with Neuro. But even now, we definitely miss him, and it would have been nice to have stayed together, for sure.

Alejandro: I hear you. No kidding. Let me ask you this. Imagine that you go to sleep tonight, and you wake up in a world where the vision of the company is fully realized. You wake up, and you’re like, “Wow! This is what I would have hoped for in this journey all along.” What does that world look like?

Marnix Broer: Yeah, that would be a world, and together with the mission, but also just my pride of reaching the goals, and there would be the majority of the whole students’ audience would be using StuDocu. They know it. They use it. They, where I now wake up and think about what it will look like. They will wake up and start using StuDocu. They go to the library of the university, open StuDocu, and we can help them on multiple fronts. Right now, we’re really good at providing great notes and having to share a platform, but we want to do much more on collaborations, and we want to be adding adjacent businesses to it in order to help them even more than just with study. Because students also have to prepare for their jobs. They need jobs during their studies, and they need housing. There are so many things in which students are in need of help, and in five years, StuDocu will capture all those things.

Alejandro: Nice. Give us a sense of the size of StuDocu today. How many employees do you guys have, and any other numbers that you could share to get an idea of what the scope is and the size of the operation today?

Marnix Broer: We manage to keep the team quite small. We love automating, so whenever we see something that can be automated, we do it. Right now, I think we’re close to 70 people, and that’s mainly because, in the last three months, we’ve hired a lot of people since our last investment round. Clearly, we’re helping more than 15 million students every month, and the whole student population in the world is a bit more than 200 million, so we have a long way to go in that sense, but I’m really glad that we can already make such an impact.

Alejandro: That’s amazing. That’s a lot of students. Imagine I put you into a time machine, and I bring you back in time because it’s been quite a journey with the company. You guys have been at it for what, 10-11 years, Marnix?

Marnix Broer: Yeah.

Alejandro: Ten to 11 years, obviously full of ups and downs. Imagine that I bring you back to a point where you’re able to put yourself, now, with all this wealth of knowledge that you’ve accumulated smack right there in that room where you’re speaking with your roommates, 11 or 12 years ago, potential ideas and what to bring to the world. Imagine you’re able to sit down with all of your younger selves, and you can give everyone one piece of advice before launching a company. What would that be and why, given what you know now?

Marnix Broer: Can it be two things?

Alejandro: Go for it.

Marnix Broer: The first one, which is, I think, by far the most important one is: get your data straight. What we learned over time, and I think a bit too late, but still in time, of course, is, rely on data. What we had a lot of with four founders were a lot of discussions going on, which is good. You made good decisions because of that because you have to convince a lot of people. However, if we would have measured our data properly from day one, we would have been able to make decisions based on data, which are simply the truth and the facts much quicker. It would also mean less discussions, faster pace, faster development, and I think only after four years, we implemented a full data warehouse and A/B testing, and that’s when it really took off because from that moment on, we could test our hunches and only pick the right ideas because you’ve tested it. Even now, sometimes, we do an A/B test, and suddenly, your revenue goes off by 15%. Wow! If we would have tested this six months ago or two years ago, it would have been so nice. Definitely get your data straight much quicker. The second would be knowing where we are right now, we should have not finished our studies and worked part-time during our studies, but actually go for it, go full-time at your company. But, yeah. That’s how things go. There are always things that afterward, you realize that you would say, if you had known this back then, of course, you would have made a different decision. But, data for sure. Data, data, data.

Alejandro: Yeah, I’m right there with you because a lot of people are like, “I think that this is cool. Let’s build it.” Then, you enter the market you’ve worked so hard at building whatever you want to build, and then all of a sudden, nobody wants to use whatever you’ve built, so nothing like being able to build something, put in minimum bare-bones, start to listen to your customers, and then you build it from there. I think what you’re alluding to is something really interesting that I think it’s very much applicable to everything, and that is listening, and that is listening to your customers, listening also to your investors to really understand the concerns that are in-between you and the money, as well as, listening for the potential concerns that maybe your employees have so that they’re able to see and live in a compelling future that is going to help you to retain in the business.

Marnix Broer: I fully agree. I can’t change a word. It’s spot on.

Alejandro: So, data. You’ve got to respect the data. Marnix, for the people that are listening right now and watching, what is the best way for them to reach out and say hi?

Marnix Broer: You can find me on LinkedIn, but also feel free to reach out to the platform and go for customer support if you want. If you want to reach out to me, please look me up on LinkedIn.

Alejandro: Amazing. Marnix, thank you so, so much for being on the DealMakers show today.

Marnix Broer: Thank you very much, as well. It was nice to share my story.

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