After founding multiple successful startups such as Twitch, Justin Kan is now revamping the archaic legal experience for high growth startups with Atrium.
Davis Baer: What’s your background, and what are you working on?
My name is Justin Kan and I’ve been an entrepreneur and investor for the last 13 years. I’ve started multiple companies, beginning with an online calendar company in 2005 called Kiko. After that, I cofounded Justin.tv, which turned into Twitch and Socialcam. I was also a founder at a startup called Exec in the home services space, which we sold to Handy in late 2013.
Then in 2014, we sold Twitch to Amazon and I became a partner at Y Combinator, a seed fund that’s invested in over 1,900 startups including Airbnb, Dropbox, Stripe, and Twitch.
Fast forward to 2017, when I started Atrium to solve my own problems in legal. Atrium is a full-service corporate law firm for high-growth companies that use technology to delivers fast and transparent legal services with fixed, predictable fees. As a long-time entrepreneur, I really appreciate it when people are able to give me expert legal advice, but I always felt like the efficiency and transparency of legal services could be improved. That’s become our working mission at Atrium.
Today, Atrium has over 250 clients who have collectively raised over $500 million in funding.
What motivated you to get started with your company?
I am what I like to call an “involuntary power user” of legal services. Working with many startups, legal was always a necessity — but the experience and deliverability varied widely.
I was talking to a partner at Wilson Sonsini (one of the big law firms in Silicon Valley) who was a friend of a friend. Turns out, she actually didn’t even know that Twitch had been a client of Wilson’s for quite a while. I asked why she didn’t look me up in their CRM — and it turns out, they didn’t have a CRM.
I thought that was super weird for such a big business. Then, I started asking her about other things. I’d just helped a company raise $17 million and we really needed to close the deal. Getting basic status updates from legal was tough, and it ended up taking nine full weeks to close. I asked this attorney, “Why don’t you guys use some sort of project management software like Trello or Asana so all parties can monitor the status of a project.” She mentioned that they tried to use Trello, but it was just really hard to get people to adopt it at the firm.
That’s when I really started thinking seriously about this space. I started talking to founders, investors, and attorneys to try and understand why there is such little technology innovation in this market. I probably talked to a couple dozen people. Lots of people seemed very open to the idea that the space could be improved.
At the time, I was also considering alternative company ideas such as launching my own startup studio. Instead, I decided I would go all in as the CEO of this new legal company because it would be the highest personal growth path for me. Once I committed, I put together a founding team, raised money, and we started building.
How have you attracted users and grown your company?
We raised a $10.5M round from over 90 investors, led by General Catalyst and many other big names in the Valley such as 500 Startups, Greylock, Thrive Capital, and many more (a bigger list is here). The goal with this fundraising strategy was to get a funnel of people who would be interested in potentially referring clients and interim users because our initial customers would all be technology companies.
We had another tactic to talk to more potential customers and learn about the market. I offered to help people with raising their Series A, including the pitch narrative and other parts of the process. That got the conversation going with a lot of companies who turned out to be customers. This was so successful that we spun it off into a dedicated program that we still do today: Atrium Scale (you can apply to the next one!).
These tactics worked in our specific situation given our target market (startups) and what we had to offer (the advice of my founding team and I). For other entrepreneurs, I think the big takeaway here — and my number one piece of advice — is to hone in on a) your customer segment and b) when they’re receptive to messaging.
One thing we did really well was realize that our early customer segment was early startup founders. Within that, we knew that they are receptive to messaging when they really need help with something that’s very critical — and fundraising was one of those things. So one of our first major product offerings was to first provide free advice and then offer legal services to help close the round. It’s really important for people to think about who their customer is, but even more importantly when they’ll be receptive to your messaging.
What are your goals for the future?
The goals for Atrium are to continue to build a technology platform that facilitates the execution of legal work. We want to make the whole process a lot more painless, for clients and attorneys alike. By doing that, we’re able to help more and more startups in a variety of ways, which is really important to us. It helps our business and aligns with the company mission.
For further growth, we’re continuing to invest in content marketing and event marketing because those are the things that have worked really well for us from the beginning. We’ve hosted a number of panels with successful founders and investors which are attended by the founders of potential customers. These channels allow us to reach founders with practical advice and great content when they need it.
What are the biggest challenges you’ve faced and obstacles you’ve overcome? If you had to start over, what would you do differently?
We made some bad tech choices in the beginning. It’s pretty much always a good idea to go with the default — Ruby and React — but we made other choices that we had to undo.
We also tried to build our own billing system, which was a really bad idea. There are so many things to focus on at the early stage of a startup that you shouldn’t try to replicate something that already works. For billing, just use Zuora.
Lastly, I would have taken the time to ensure better alignment from day 1. We grew so quickly and then had to go back to define the mission and vision. If I had to do it over again, I would have invested more time into that earlier on.
Have you found anything particularly helpful or advantageous?
As a multiple-time Y Combinator (YC) alum and former partner, I know how amazing that community is. YC has a new growth program for later stage startups which is really good. It’s designed for growth stage companies, with a focus on scaling management and dealing with other growing pains of a scaling startup.
Additionally, I love to read and believe it is very important to find time for myself to get outside my daily context and reflect on how to improve. Two great books I always recommend are Elad Gil’s High Growth Handbook and High Output Management by Andy Grove.
Some of my own personal habits include working out every day, meditating, and using a gratitude journal. Those habits all give me context and serve as a healthy reminder that the daily ups and downs shouldn’t rule your life. These firestorms aren’t as important as they feel in the moment.
What’s your advice for entrepreneurs who are just starting out?
Just get started. You want to get out there and get started. It’s simple but really important. The first step is always the hardest. I think people often get trapped in a career that they don’t like because they were not willing to make the change early enough. Oftentimes, you just have to get out there and get some initial momentum. People always underweight how important momentum is. Momentum is very, very important.
Where can we go to learn more?
You can find out more about Atrium at https://www.atrium.co, where we’ve written a couple great posts about fundraising and advice for startup founders:
- How to Raise a Seed Round
- How to Raise Your Series A
- What We’ve Learned Helping Startups Raise Over $500M
You can also follow me on Twitter — @justinkan. Feel free to ask me any questions about this interview and I’ll do my best to respond to you. Thanks, Hacker Noon!