I'm sure everybody has already seen our announcement today about securing a $2.75 million round of financing. This culminates many months of hard work to get the capital in the door that we needed to complete our vision for ActiveRain.
For those that don't know the ActiveRain Real Estate Network started as a 3:00 AM brain fart of mine almost two years. We had been building lead management software for real estate brokerages at the time, and I decided to put the little profit we had into launching the initial version of the social network. It took off a lot faster than I expected and within six months we changed our focus to 100% concentrate on social networking as opposed to software for brokers.
The next year and a half we pretty much shoe stringed the whole operation along. Partly funded by HELOC's on our homes and small investments from a few angel investors. As recently as this spring we had three employees, I was working out of my basement "dungeon", and several of us had gone months without pay (ah, the life of a startup). We had grand visions for what we wanted to do with ActiveRain but all our resources went to simply maintaining what we had. There was no way we could keep things running and grow at the same time so we needed outside funding, which of course took even more of our time.
I don't know how many of you have gone through the process of raising funds, but it is a long, hard slog even if you are a "hot" company like ActiveRain.
We talked to VC's, Angels and a multitude of strategic investors trying to get a deal that not only worked from a financial standpoint, but didn't conflict with the promises we'd made to members, or our planned business model. I've worked for several small startups that were basically driven under when they took money from the wrong investor. In the end I'm very happy and I think our members should be pleased with what we were able to structure. Now I just gotta go beat on Jerry's door and try to get that Outside Blog platform out the door ;)