Business

How a 19-Year-Old Raised Nearly $2.5M for His Startup

Lucas Béland, a 19-Year-Old CEGEP dropout from Montreal, raised nearly $2.5M in the last year from various angel investors for his mobile advertising startup GoLoot.
How a 19-Year-Old Raised Nearly $2.5M for His Startup

Summary

  • GoLoot is a startup aiming to change the model of mobile advertising by connecting real-life rewards to mobile experiences.
  • At 16, Béland came up with an idea for a mobile game similar to Pokémon Go.
  • Béland flew to Paris and became an unpaid intern at the French video game company Asmodee Digital in the following summer.
  • Through an extensive network, Béland raised $300 000 from various angel investors in Montreal in 2019.
  • Béland pitches GoLoot to former Paysafe CEO Joel Leonoff, kickstarting a new round of funding raising around $2 000 000.
  • Béland drops out of Collège Jean-de-Brébeuf at 19 to focus full-time on GoLoot while attending Harvard Business School Online.
A New Innovation Hub

Now past the Golden Age of Silicon Valley, the latter's methodology lives on in a new innovation hub in French Kanata. With increased government spending and tax credits for entrepreneurs, along with industry-leading research in emerging fields prompting the settlement of big players like Google Deepmind, Facebook, IBM, Airbnb, Sonder, as well as accelerating the growth of existing startups like Lightspeed, Dialogue, and Element AI (though now ironically and contentiously sold to Silicon Valley software company ServiceNow for $230M) that lead to the creation of new venture capital funds and angel investors every other month, Montreal has more than enough proven itself to be a prominent site for upcoming entrepreneurs, even having its own set of public venture voices like Guy Laliberté, Ethan Song, and Mitch Garber, well-known local investors who play a key role in voicing Montreal's technological future.

New Generation of Youngtrepreneurs

It is in this environment that youngtrepreneurs with grand visions like Lucas Béland came to found GoLoot, a startup aiming to disrupt mobile advertising by “building engaging advertising experiences'' for local and international brands, connecting the evermore prevalent and infuriating mobile ads to targeted real-life rewards such as discounted products, deals, and exclusive promotions. With “human-driven, mobile adapted advertising experiences'', as Béland calls it, the Montreal-based company seeks to transform mobile ads into meaningful events for users, “a moment where connecting with your favourite brand becomes convenient, purposeful, and relevant in your app experience”.

Advertising Models

The current advertising model in mobile games uses a “rewarded ads model” (rewarding the user with in-game currency after viewing an ad), the which Béland refers to as a “cumbersome and senseless event billions of people do all the time”. GoLoot, however, will employ what Béland calls the “advertising-as-a-reward” model (“ads users should enjoy seeing and interacting with within their mobile experiences” that also benefit them in real life). Béland speaks confidently about the change in the way people perceive and engage with ads in the near future and expects to release the first version of its product in early-2021.

I had the chance of having a two-hour long conversation with Béland on The Visionnaires, getting to know every bit of detail of how he came to be. Charismatic, confident, and resolute, Béland fits the business aspect of things exactly as one would imagine. And through a variety of angel investors, the 19-year-old CEO and his company GoLoot have raised nearly $2.5 million in its first year, closing its last round in June 2020.

Lucas Béland, 19-year-old founder and CEO at GoLoot


From Pokémon Go to GoLoot

GoLoot went through many stages of transformation before settling on its current business, the same can be said about its founder.

Béland, at 16, thought about becoming a radiologist, the highest paid medical specialist profession in the entire province, but then made the switch the following year to pursue humanities in secondary 5, and then a DEC (Quebec Diploma of College studies) in Sciences humaines at Collège Jean-de-Brébeuf, the which he never completed. With a notable family background rooted in business and finance, this was a natural choice of career for him. The Béland family held important positions in Quebec. The great-grandfather, Benjamin Béland, founded the Caisse Populaire d'Outremont. The late grandfather, Claude Béland, son of Benjamin, was CEO of 13 years at one of the largest financial cooperatives in the world, the Desjardins Group (Mouvement des Caisses Desjardins). The father, Philippe, holds a senior position at Canva Group, one of Canada’s largest industrial and commercial printing company. Generations upon generations have instituted in Lucas an unwavering passion for business, as well as a competitive advantage that shan't be disregarded. Nonetheless, it took a fair bit of self-discovery and exploration for Béland to settle on his role of becoming an entrepreneur.

Open-World

In 2016, a new mobile game came to disrupt the entire world. A year later, in 2017, it had reached every news outlet and every social media page 24/7. Its recipe for success included an already popular and beloved franchise, mixed with the excitement of increased accessibility of augmented reality, as well as the essential, all-encompassing feature of GPS and open-world maps installed on every smartphone. Pokémon Go transcended the mobile screen, connected the digital with the physical, and resembled a Black Mirror episode right before total catastrophe. Though as of now, over 200 deaths and thousands of injuries have been linked to the game.

"As a young man who always wanted to start my own business, this was absolutely it. This was the promise of tomorrow."

In awe of what Pokémon Go had accomplished, Béland sought to produce his own augmented reality mobile game back in Secondary 4, at 16 years of age. The concept differed from Pokémon Go in the sense where instead of getting users out in the street to run after purely virtual rewards, the latter is replaced with products and coupons that can be consumed online or at any point of sale, the which Béland called the "hyper gamification of products and services".

Contrary to most startup founders under the age of 25, Béland does not code, nor has he a particular interest for programming. But the idea of a game that is pushing the boundaries of what a game can do still appealed strongly to him, stating that "as a young man who always wanted to start my own business, this was absolutely it. This was the promise of tomorrow".

Parisian Chronicles at Asmodee Digital

Wanting to further pursue game design, Béland crawled through family contacts and looked for opportunities that could help him get a better grasp at the industry. His mother of french origins happened to have a cousin who was President of the French board game publisher Asmodee. Founded in 1995, Asmodee developed their own board games, card games, and role-playing games (RPGs) while publishing and distributing for smaller game developers. Since then, Asmodee has become one of the world's leading board game publishers, having made numerous acquisitions to dominate the market. To accommodate for the forthcoming takeover of digital consumption, Asmodee Digital was created to ensure the transformation of traditional, physical games to mobile and PC ready.

Lucas In Paris

Over the summer of Sec. 4 to Sec. 5, the equivalent of grade 10 to 11, Béland packed his bags to spend the summer at Asmodee Digital as an unpaid intern, living with cousins, handling customer service and data entry in the mornings, tagging along with the developers in the afternoons. Programming, however, was never his passion. Béland loved the business side of it and the internship had shown him much more than he expected. Every day, he received a large batch of monetization data ranging from the number of daily active users and downloads, the churn  rate, the effective cost per mille (eCPM, measures the ad revenue generated by a digital ad divided by 1000 impressions), the average revenue per user (ARPU), and such and such that needed to be manually entered into an Excel sheet. Through valuable data, he was able to understand the inner workings of a business, especially one in an industry he had already set his eyes upon.

Organizational Success

In the afternoons, Béland wandered around the studio at times, studied the anatomy of games with fellow developers, hung around cafés occasionally during lunch hours, doing whatever task that was asked for him around the office. What really stuck with him all the way through GoLoot was, however, on the management level. Every Friday, the CEO of Asmodee Digital, Pierre Ortolan, gathered everybody from all departments at the roundtable, considering that the company was of a relative size of 20 to 30, asking each to go over their achievements throughout the week. Béland recalled that this allowed senior management to get "transparent, weekly reporting with complete visibility, create synergies between departments, make people feel as though their work matters in front of everybody, and create that culture and ethics" that is key to organizational success.

Unification, at the end of the day, was "brilliant and absolutely crucial in management".

Béland carried on this tradition at GoLoot and has since been practicing it every week. At the Asmodee roundtable in Paris, the Lucas Béland who was merely an unpaid intern was speaking alongside the CTO and the lead designers. This simple ritual made all the difference to him. He felt as though his work contributed to the collective, growing success of the company just as much as the others simply by being paid attention to. Unification, at the end of the day, was "brilliant and absolutely crucial in management".

The most interesting Parisian anecdote though was when the studio had to communicate with an American partner over the phone. Béland, now having a practical reason to be from Montreal, was given the task to handle the talking since he was the only one who spoke "credible English", having been provided with an extensive list of all probable questions and answers ahead of time.

GoLoot's Destruction

Shortly after coming back from Paris, Béland pitched the idea to mobile game studios in Montreal, most notably one called LuckyHammers, which ended up shutting down in 2019. Marc-Antoine Pinard, the then co-CEO, stripped the GoLoot game to its core and offered criticism that "completely destroyed the idea". But this was the moment where the current concept of GoLoot started to emerge. Béland stated: "eventually I realized that what had real value in what I was trying to build is to reward users and consumers with products and services and discounts. The nature of the concept was still the same. But I dropped the game part". Béland credited this refinement to the synergy created by the many discussions with mentors and advisors and waves of criticism that revealed what was truly essential at the end of the day.

Founder's Vision

This was the turning point of GoLoot, but to reach this stage took a fair bit of courage and perseverance. From becoming an intern in a game studio in Paris at 16, to pitching an idea that, after showing to experienced developers and executives, became "a huge failure", Béland recalled, he noted that one thing never changed throughout the journey. It was the vision that mobile advertising can and need to be changed in a drastic way. He never once doubted that idea, and so whatever criticism there was to the execution of that vision, it only meant that he was getting closer to the right path.

Lune Rouge, Angels, and $300 000

Around early 2019, a distant family member learned of Béland's ambition and introduced him to Lune Rouge, a creative incubator/investment fund type of organization created by Cirque du Soleil's billionaire founder Guy Laliberté. Lune Rouge's vision today, as it is stated on the website, "rallies skilled entrepreneurs from a wide variety of backgrounds around a single objective: to capitalize on one of Quebec's most valuable resources – its unique creative talents – in order to stimulate entrepreneurial innovation". Lune Rouge sought to accelerate the development of tech, entertainment, arts and real estate in the province. From there, Béland pitched GoLoot to its co-CEO at the time, François Plamondon, and Patrice Boily, CEO at a subsidiary called Lune Rouge 360, now operating under the name of Hello Network.

"Everything starts now. It's a new beginning. It's so much pressure, so much stress."

Patrice Boily, upon meeting Béland, quickly took him under his wing. Boily was fundamental in the development of Lucas Béland as an entrepreneur even more than GoLoot as an enterprise. He was "a father figure in business" to him, teaching him how to position strategically in the market, how to pitch, how to find the right people, etc. Lune Rouge, Béland recalled, is "an amazing story of how an ecosystem having the right mindset can produce stories of success". High-level executives are developing an interest in young, ambitious entrepreneurs in Montreal, providing resources and mentorship that aren't usually found in cities other than those pushing the boundaries of emerging tech. An ecosystem describing the synergetic relationships between researchers, entrepreneurs, VCs, angel investors, corporations, is what enables the increasing likelihood of senior professionals engaging with inexperienced, but driven innovators who have grand visions that they seek to execute by all means necessary.

Attracting Angels

When it came to funding the project, Lune Rouge did not possess the same enthusiasm as Plamondon and Boily's interest in Béland yet. Boily informed him that if he was able to raise a decent bit of initial capital elsewhere, he would provide him with additional resources to grow the company. Without time to waste, Béland went to everyone he could find, from family members to family friends to various established entrepreneurs and companies from all industries, asking for a couple of minutes of their time, pitching the advertising revolution that GoLoot wishes to achieve in the future with a single sheet of paper that summarized the company's mission and illustrated its impact. Starting from there, he attracted a following of a group of entrepreneurs willing to provide early funding as angel investors. In the summer of 2019, he raised $300 000, just before starting his last year of CEGEP.

"The feeling was immense success and I was really really proud of that. But it wasn't something that I made public. [...] You're more excited along the way when you line up those investors. Once the round closes, it's not prize money. Everything starts now. It's a new beginning. It's so much pressure, so much stress."

Mitch Garber, Silicon Valley, Paysafe, and $2 000 000

Now with $300K behind GoLoot, Béland returned to Patrice Boily at Lune Rouge, who immediately introduced him to a network of developers and gave him an office space within Lune Rouge that Béland used as an official business address. Béland reported regularly to Boily, who advised him every step of the way and even introduced him to potential clients. "Patrice did all that without asking anything in return. This is what emerging tech economies mean", said Béland.

In late 2019, now that GoLoot has a clear direction to steer towards, Béland sought out two things the most: funding and mentorship to execute his vision. One of the angel investors from the first round, Brian Young, an executive at Rebox, lead Béland to none other than Mitch Garber. Garber has more than already made a name for himself in business and investing. At the time they met, Garber was the former CEO of Caesars Acquisition Company, Chairman of the Cirque du Soleil Entertainment Group, Chairman of Invest in Canada, Board Member of multiple companies such as Shutterfly and NHL Seattle. The Financial Times reported a $210 million compensation for Garber from Caesars Entertainment Corp, while Bloomberg, in 2016, ranked Garber as the 7th highest paid executive of a publicly-traded US company.

From East to West

After having pitched GoLoot to Garber, the latter introduced him to Silicon Valley executive Jason Lapp, who was the former CEO of Kiip, a mobile advertising company that had an almost identical concept to GoLoot's core idea. "Instead of digital rewards, Kiip provides consumers with tangible rewards, like a bottle of water for every eight miles run by a user." Kiip, however, was acquired by NinthDecimal in late 2019 and went into foreclosure. Lapp is now President and COO of beautiful.ai, an AI-powered presentation software company. In February of 2020, when GoLoot began another round of funding from angel investors, Lapp officially became "GoLoot's most important advisor".

Leonoff & Chazonoff

Having introduced Béland to Lapp, Garber was out of GoLoot's picture for a short while. Béland, still actively looking for potential angel investors and mentors in early-2020, went from contact to contact, seeking anyone who could fit the description of an experienced, successful entrepreneur who had the "right mindset of willing to invest in young and risky growing ventures'' and "who had time to serve as an active mentor". Through his early investors from 2019, he ended up meeting Danny Chazonoff, COO of Paysafe Group, a multinational online payments company. Chazonoff was met with immediate interest, but he never invests alone. Therefore, Chazonoff introduced Béland to Joel Leonoff, friend of Mitch Garber as well, who had recently stepped down as the CEO of Paysafe in 2019 to play the more passive role of Vice Chairman of the Board of Directors.

Encouraging Innovation

Béland met Leonoff in his Paysafe office for around 30 minutes to pitch him everything GoLoot had to offer. Leonoff immediately proposed an investment after that first meeting, kickstarting the second round of angel investments that would eventually raise over $2 million. Béland recalled about Leonoff that "he and I instantly clicked on a mutual ambition to create an entrepreneurial environment in Montreal. Joel believed that in order to create a risk-taking environment, you need to have wealthy entrepreneurs and VCs actively investing in emerging young tech. This sort of investment is, and always will be risky, but it’s how tech markets create synergies that enable success stories like Uber and Airbnb. A seed investment culture has countless ripple effects: an increase in talent density, encouraging innovation, an increase in competitiveness of local economies, etc".

First Hire and the Thrill of Entrepreneurship

Around the same time in early 2020, Béland left the Lune Rouge office, connecting with Boily occasionally. Marvin Nguyen, a software developer who worked in product development and engineering at various startups, was hired by Béland before the round as GoLoot's first employee, charged with building the company's software from the ground up. The second round lasted from February all the way through to June of 2020, closing at the early hints of a pandemic-fuelled summer. Leonoff lead the round, followed by mostly investors from the first round of $300K.

Now that GoLoot has nearly $2.5 million in funding, some three years after Béland conceived of an idea that stemmed from seeing masses of people running around the street to catch Pokémons, the pressure has never been higher and the thrill of an entrepreneur has never been felt as intensely. Garber joined GoLoot as a key advisor following the second round and, until today, has weekly calls with Béland to oversee GoLoot's journey to product launch.

Dropping out, Harvard, and the School of Life

Béland, during all of this, was still a senior CEGEP student at Collège Jean-de-Brébeuf, taking classes during the day, eating lunch at the cafe, going to student parties here and there. However, the responsibility and the pressure of managing millions of dollars of investor money incomparably outweighed his CEGEP studies on littérature québécoise and méthodologie and whatnot. Gradually, his academic schedule was getting in the way of his meetings with investors. Towards the end of his senior year and simultaneously the second round of funding, Béland dropped out of Brébeuf to pursue building GoLoot as a full-time profession. "It was obvious. There was no other way." With little time to spare, Béland enrolled in Harvard Business School Online on the side to get the essentials of management, though "having a hard time to complete assignments".

Béland expressed that when you're met with an opportunity that proves to have so much potential, not taking it will be the most risky thing that one could do. CEGEP, for him, was "a school of life more than anything else". It was an important step in discovering one's self-identity and to form and foster connections that will last a lifetime.

Family Matter, Support Systems, and the Weight of Entrepreneurship

When it came to his personal entourage, Béland added that his parents are strongly involved in GoLoot as investors and advisors as well, providing support both on the business side and on the personal side. "Nothing would’ve been possible without my parents. I benefited from their network. [...] They built relationships that I leveraged and I was able to bounce off of these relationships to grow my network", noted Béland.

To assure that business does not interfere with family matters, Béland added that clear boundaries were set since the beginning. "We found a way to build that healthy relationship and balance. It sometimes leads to fights. But it works. It just works. [...] I made it clear with them very early that this was my endeavour, and if it fails, it's entirely my responsibility. And if it succeeds, it's entirely my responsibility. [...] I ask them to trust everything in me to get it right. That's how we found that balance."

"We dream big as a family. [...] We can dream of the wildest things when it comes to GoLoot. [...] It's been fun, but also very challenging. It's been tough for them to accept that it's going to be my way, or the highway", said Béland with a giggle.

As a young entrepreneur, Béland mentioned, "you have to find people around you to pull you out of the business and the job and remind you that you're still a kid. And it's okay to be worried and stressed and anxious about what you're doing. It's hard sometimes to manage people. It's hard to have seven people who work for you when you're only 19 years old. It's hard to manage money when you're 19 years old. It's hard to pitch to clients. It's hard when you fail. But, you have that support system around you that reminds you of what truly matters at the end of the day. And you pick yourself up."

GoLoot's Future

Jacques Fregault, former Head of Technology at Redpill VR and Technical Director at LuckyHammers, joined GoLoot as its Chief Technology Officer. Pierce Borne, former Head of Sales at Narcity Media and freelance marketing consultant, joined GoLoot as its Chief Marketing Officer.

GoLoot expects to launch the first version of its product in Q1 of 2021.

Credits

Cover photo via GoLoot

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