00:00 Against Gravity is a VR company that makes Rec Room, a virtual reality social club where people can meet up in different rooms and play games together.

05:32 Against Gravity raised almost a million dollars in a convertible note with friends, family, and former coworkers, allowing them to launch their app, make key hires, and get customer traction, before raising a longer round with institutional investors to extend their runway and take advantage of the growing VR market.

11:14 Against Gravity CEO Nick Fajt and his co-founders started the company with the intention of exploring the possibilities of AR and VR in the social space, and they launched their first product, Rec Room, as a Wii Sports-like VR game that served as a starting point for their vision of creating a social platform in virtual reality.

17:03 Against Gravity CEO Nick Fajt and his co-founders took a unique approach to their seed round fundraising, being prescriptive about the amount they wanted to raise and the terms they wanted to raise it on, and they also ditched the traditional PowerPoint deck in favor of having investors download their app and experience it firsthand.

22:44 Against Gravity CEO Nick Fajt and his co-founders pre-qualified potential investors by requiring them to download their VR app and provide feedback, resulting in more interested investors and helpful suggestions for product improvement.

28:27 Against Gravity CEO Nick Fajt and his co-founders went through a three-stage process of qualifying potential investors, with a clearance rate of about half to a third of principals' associates, 20% of partners, and a drop-off of those who were not interested in VR or gaming, but they improved their storytelling and received helpful suggestions from investors who had spent a lot of time with other companies.

34:04 During the diligence process with Sequoia, Against Gravity provided data on user behavior and cohorts, but since the product and company were still young, most of the evidence was in the product itself, which showed that the team was scrappy and had capital efficiency; after raising the seed round, the company tried to change as little as possible and continue with their successful formula, and Sequoia was on board with this approach.

39:34 After raising the seed round, the company tried to change as little as possible and continue with their successful formula, and Sequoia was on board with this approach; the board provided guidance and accountability towards the long-term vision of the company.

45:10 If Against Gravity hadn't raised funding, they would have focused on monetization within Rec Room rather than long-term problems like abuse prevention and moderation tools, as well as user-generated content.

51:12 Rec Room aims to foster a sense of well-being and provide a unique and meaningful experience for users through the ability to create and express themselves, as well as the real-time social interactions in VR.

57:19 The VR market has not yet reached its mainstream potential, but there is a critical mass of users that software developers can learn from, and the dominant platform, surprisingly, is PlayStation VR due to its simplicity and lower price point.

01:03:33 In early-stage startups, especially in new markets, user feedback is crucial, and building in isolation without market interaction can lead to building the wrong thing.

01:09:09 The host and guest discuss various books and video games, including "Ready Player One" and "Seven Eves," and the importance of tentpole content in the bundling and unbundling strategy of distribution platforms.

01:14:55 The guest discusses his initial skepticism of the Nintendo Switch but ultimately praises its value proposition and versatility, particularly for frequent travelers and those seeking meaningful gaming experiences.