Two Founders’ Journeys in gBETA Indiana Industry 4.0 and how to balance demand, supply & funding
By Rod Baradaran and Scott Willson
We first crossed paths in early 2024 as startup founders participating in gBETA Indiana’s Industry 4.0 acceleration program led by Davide Dantonio, the director of gBETA – gener8tor.
Our companies are rScan, a reverse logistics startup, and Motoring Labs, which specializes in computer vision technology for trucking fleets. Despite coming from different sectors, we were both “deep in the deep-tech”, engineering advanced technologies to disrupt our industries. We also shared a common challenge of how to scale a startup resourcefully, a.k.a. without running out of resources.
In one of our gBETA Cohorts gatherings, we vocalized this concern and we found the whole group of startups interested in diving deep into this topic. In response, Dantonio presented a framework that put our approach to growth into a different perspective that has become a compass to which we often refer to guide our action-prioritization and overall balance between supply, demand, and funding.
Dantonio shared with us that he came up with this framework by noticing some common patterns in coaching more than 20 startups to put together their goal-setting strategy map (OKRs and KPIs) and getting feedback from more than100 investors and venture-experts that were involved in prior programs. In this article, we share a few key points of that framework, as well as our own venture journey balancing between supply, demand and funding.
Dantonio emphasized that “falling in love with the customers’ pains and desires” was the starting point as well as the Northstar of startup growth. The core of the founders’ job is intercepting those needs (Demand) and building a product or service whose core functionalities are solely tailored to address these specific needs.
Demand: This is the main force driving the business is not the product push (on the market), but the customers’ pull (on your product.) The problem either exists or does not exist; you can’t create it or you can’t control it. If it exists, it is out in the world, and different customer segments will feel differently about it. Most importantly, the demand is about ACTION, which is caused by pain points.
Dantonio pushed us to focus on specific customers that not only have the problem and know they have it, but are actively seeking a solution (possibly, testing alternative solutions right now, because they have the “Hair On Fire” syndrome), a.k.a. Early Adopters. Refine the customer persona with decision-making and buying power, as well as their incentives both as an organization and individual, to adopt a new solution. Make hypotheses on your customers, find where your customers spend time, aggregate (online communities, industry conventions), and ask them open-ended questions solely about the problem-space (“What organizational or personal goal is this individual trying to accomplish, and why does it matter to this individual? What are the main challenges in your current system/processes towards this goal? What other options for solving this problem have you explored, and what was the result of those? Overall, what has held you back from solving this problem and accomplishing [cheaper/ faster/ better] your goal?)
Supply (& Distribution): This is what your startup can build and deliver to the market. In the equation “Demand=Supply”, Supply is the part of it under your control. Build a minimal solution (the “tip of the iceberg” of your big vision. Start small by developing only the core features that address your customers’ most critical pain points. The Pareto Principle (the 80/20 rule) applies in this context: create the 20 percent of your product that solves 80 percent of users’ problems. Once you deliver your supply at the beginning, “do things that don’t scale”: as a case in point, offering white-glove services to your first customers and/or ‘becoming their consultant’ in their early usage of your product allows to continuously seeking rapid feedback from customers and iterating your product quickly based on real user data.
Funding: Capital is crucial to scale a proven demand. Ideally, instead of chasing investors with just an idea, first prove that customers want your solution and have the intent to pay for it (through pilots, letter of intent, pre-sales, or early sales). Then, seek funding to scale up what is already working. The advice that Dantonio shared with us is: “Finance the supply, in order to build the capacity to serve more demand.” In other words, the lure for investors is that the startup has customers who are ready to buy, and the company needs to build Supply Capacity to ship the product, and for this reason, they need Capital. Also, do “investors-discovery” to understand whether their focus is on (a.k.a. Investment Thesis), and spark interest in the first five minutes, by answering these questions:
- Why this Problem?
- Why this Solution?
- Why You?
- Why Now?
- How do you make money with what you are doing?
- Is this a financially sustainable business?
Easier said than done! Agreed! But in practice, how did each of us apply this framework?
One of us pursued venture funding with a clear plan, while the other postponed venture capital investment to bootstrap longer – both paths guided by balancing demand, supply and funding. By the end of the gBETA program, we saw that this approach saved us time and set us up for sustainable growth. Read on to hear each of our specific journeys.
Motoring Labs’ CEO Scott Willison on Timing the Ask and Proving Demand
“When I joined gBETA, I was eager to raise money to fuel my startup. With a promising computer-vision solution for fleet management powered by the trendy artificial intelligence/machine learning (AI/ML) and with a prototype ready, I assumed investors would jump in early. Davide Dantonio’s coaching made me hit pause on that assumption.
He asked me point-blank: “Do you have evidence of real customer demand?” That question hit hard: I had no one paying to use our product yet, only a prototype and some friendly interest.
He urged me to first focus on real customers (Demand) to test our assumptions, then shape our product (Supply) to meet that demand, and only then consider Funding to scale what is working.
Taking that advice, I shifted my focus to landing a pilot customer during the program, instead of pitching investors right away. I started talking to trucking companies. Not about investing in us, but about their needs and whether our tool could solve their problem. This approach led to our first pilot deployment with a regional logistics firm. It wasn’t a massive deal, but it was proof of demand: a real company was willing to use our product and even pay for it. With that traction in hand, our story carried a lot more weight.
With the pilot’s success, I finally felt confident about fundraising. Soon after, we closed a $100k pre-seed round with the help of our accelerator’s introductions. We timed this raise immediately after the pilot, so we could show investors actual usage and results. We could now show investors real results instead of just promises, which made those conversations much easier. Once the capital was in, we spent it carefully to amplify what was already working: improving features our pilot customer wanted and reaching out to similar potential clients.
My biggest lesson was understanding investor readiness: it’s not about just having a cool idea, but about approaching investors when you can demonstrate traction and a clear plan. By waiting for real market validation, we raised money on better terms and used it far more effectively. Looking ahead to a seed round, I’m sticking to the same principle: raise only what we need to reach the next customer-driven milestones. Rethinking the balance of demand, supply, and funding kept us from raising too much too early, and from building stuff nobody asked for.”
rScan’s Rod Barandaran on Bootstrapping with Demand Focus:
“Our team bootstrapped the company during its initial years, steadily growing through customer revenue by addressing a clear pain point in retail returns management. Early on, we decided against raising venture capital because we wanted more time to deeply explore the industry without immediate pressure to scale prematurely. To better understand our market, we launched our own ecommerce store, built comprehensive reverse-logistics operations, and developed user-friendly technology aimed at empowering others to start their own e-commerce businesses.
During our time in the accelerator program, we shifted our focus to selling our technology to help others manage their own operations. Davide Dantonio encouraged us to prioritize customer retention and acquisition and facilitated introductions to Midwestern venture capital firms. With proven market demand and the opportunity to enhance our supply capabilities, he emphasized that outside capital is like fuel – most effective when poured onto an already burning fire.
In the early stages of the program, I concentrated heavily on sales, attending industry trade shows, leveraging gBETA’s introductions, and personally reaching out to target companies. Davide encouraged us to “do things that don’t scale” to ensure customer success, thanks to the ongoing feedback loop with customers. This approach proved effective, as we doubled our revenue within a year and successfully onboarded several enterprise clients during the program.
By the end of gBETA, rScan was experiencing rapid growth with a surge in customer interest. At that point, Davide’s support positioned us well for conversations with investors. Through one of his connections, we even secured a non-dilutive grant ($1.2M State Incentive in conditional tax credits), allowing us to continue expanding without prematurely committing to venture capital funding.
By focusing on building demand, as Davide advised, we achieved sustainable growth that positioned rScan for future investment.”
Key Takeaways for Founders
Our gBETA Industry 4.0 experience and Dantonio’s coaching gave us an effective strategy for building our startup. Key takeaways that may help you in your founding journey include:
- Validate demand before building: Make sure there’s real customer need for your idea before pouring resources into development or fundraising. Early user interviews and pilot sales can save you from building something nobody wants.
- Start small with your product: Build the simplest version of your solution that solves the core problem. Get it in users’ hands early and iterate. Don’t waste time on extra features until you have proof of what people actually need.
- Fundraise when you have the demand already built: Whenever possible, hold off on raising money until you can show users, revenue, or other traction. Investors will value your startup much higher once you’ve proven people will pay for your solution.
- Do things that don’t scale: In the beginning, you will need to cold-call customers, provide hands-on support, and go the extra mile. This is the fastest way to learn what your market really needs and to earn early customer trust.
