29 Rejections, 1 Yes: How a Korean Founder Built a Unicorn

When John Kim first tried to raise a Series A for his chat platform startup, 29 out of 30 Silicon Valley investors said no. The one "yes" came with a term sheet so terrible it felt like another rejection. This wasn't just about his product—it was about everything he represented as a Korean founder without an Ivy League pedigree in a valley that seemed to only back Harvard, Stanford, and MIT graduates.

Fast forward seven years, and Kim's company Sendbird has become something unprecedented: the first Korean startup to relocate to Silicon Valley and achieve unicorn status. Built from a $300-a-month desk in a law firm's spare office, Sendbird now powers chat and messaging for thousands of companies worldwide, processing billions of messages monthly.

In this candid interview, Kim breaks down the three critical lessons that transformed his company from a struggling local player into a global powerhouse. His insights reveal why most local market winners get "their ass kicked" by Silicon Valley companies—and the brutal mindset shift required to compete globally from day one.

John Kim: Let's see, just a little bit about me, John, CS Sendbird. We went through Y Combinator back in 2016, but actually we focus on the bi-directional conversation that happens inside your mobile application, and most of our businesses are mid-market to enterprise.

In 2015, I came to the US by myself. We also found the cheapest quirky space in the entire Bay Area. And this place, I think, gave us a spot for $300 a month, a dedicated desk, not a hot swappable desk. I think back then WeWork was like $450-550 dollars. This was a law firm actually. So we worked out of there and then ultimately the partner saw us working until like 10:00 p.m., 2:00 a.m. all the time. So he actually gave us a private suite at the same price, which is fantastic.

So we joined Y Combinator in 2016. We're the second Korean company to go through YC. We didn't get any recommendations. There wasn't any like magic. I think we just got lucky. Our group partners were Justin Kan and Michael Seibel, and they're obviously co-founders of Twitch, so they knew something about chat. Sort of like, oh yes, you guys should exist. I'm like, thank you. So we got in.

John Kim: Four dudes working, sleeping out of a one-bedroom apartment. And we also raised a small seed round at YC demo day. And this, again, we started in 2013. It's like three years later, we're doing seed round. And I actually wrote a pretty long essay within the YC community called 'Broke phase'. It is OK to be not liked on demo day cause we're certainly not the hot startup.

We didn't get a lot of investor interest, like literally had to collect 500, 1000 checks to collect a million dollars and a half million. And so it was like really, really painful process, but we're still able to raise the money. There's around some kind of a language barrier because English is not my first language. My teachers are Netflix stand-up comedy. So, like, really, there's a lot of unconscious bias I think I was going through.

We failed a Series A fundraising at the beginning of 2017 when we just broke a million dollars in ARR. I met 30 investors, all local, 29 said no. One gave us a really shitty term sheet. And that summer hit, all the investors went to whatever Bahamas and Hawaii. So we basically went back to our existing seed investors. Thankfully, I was sending investor updates. So if you're not sending investor updates, please send them on a monthly basis at a minimum. And I basically begged them for a million dollars extension, which thankfully, we did.

John Kim: By October, I was like literally afraid to go out and fundraise again cause I didn't go to Harvard or Stanford here. Like I didn't know anyone here locally. So I was telling this story. I was telling myself, it's like, they're going to only back Stanford and MIT and Harvard grads. Like there was back then, there was a stat that 80% of fundraising done in the Bay Area back then went to those three schools, I think.

But I remember this quote, somebody said it, it's like, be so great that nobody can ignore you. So thankfully, our revenue tripled during the summer. So by the time we went out to raise Series A, we were already past 3, getting towards about 3.6. And immediately all the people who said no, start saying yeses. So we could pick the investor we want to work with. So I'm like, OK, Silicon Valley is kind of fair. I mean, there's a lot of biases, don't get me wrong, but as long as you have revenue, they will give you money. I'm like, how great is that?

John Kim: I just want to share a couple of lessons we learned along the way. Hopefully, you'll find it useful. One, first thing is like I learned, unlearning a lot of the things that what I thought was key to success in Korea, I just had to wipe it off of my body basically. I just had to forget how to build startups as a Korean way. I was born and raised in Korea, spent most of my life in Korea. So a lot of the collectivistic culture. Agreeableness, not being assertive, all that. It's like, that was me.

Think about the way it's like in engineering and science, there's a concept called local optima and global optimum. Basically, when you're entering the market as a gray arrow, there's a lot of mountain you can climb. If your only fitness function or only key metric to success is growth, you're very likely to get stuck in one of the smaller hills, right? Obviously, there's a bigger hill to climb, but when you're starting as a Korean company selling the Korean market, you're very likely to get stuck in one of the local optima.

John Kim: And that was OK. Korean market was growing, it was big enough to feed the families and the businesses, and the local market was protected by language barrier, regulations, all that. But with digital, now what happens when the barriers to entry disappears, right? The floodgates open.

So I think there's a couple of examples. Social network. Cyworld started in 1999, massive success. All the Koreans used it. Ultimately, sold for, you know, cents on the dollar. Facebook became the most dominant social networks in Korea later on. Online videos also again started earlier than YouTube. Pandora TV. YouTube is now the most widely used product in Korea versus Pandora TV. I don't know what happened to Pandora TV.

So what's the story here? When there isn't a real local moat like regulations or something in the digital world, in globalization, it becomes a winner-take-all market because when the global optimum, meaning the product with the most amount of funding, the best user experience, all that comes in, there's no defense against them, literally. So the markets get wiped out, as you've seen from all the examples, the local winners ultimately get their ass kicked by better funded companies, usually from Silicon Valley.

John Kim: When I saw that, I'm like, we started in Korea, we're a Korean company. We're like, but B2B SaaS, hmm, let's see. I think if some other company that does chat is better funded in Silicon Valley, they'll come to Korea and we'll get our ass kicked. The only reason we can survive is when they think Korean market is not big enough, but they're still gonna go after India, China, or other countries.

So if we cannot survive on our own in the most competitive market in the US, it's just a matter of time till we die. So the only way for any companies, any company to survive is to go global, unless you're a barbershop. Our next goal, we have no choice but to reach for the global optimum.

A little bit of history. So Korea as a nation was like dirt poor because we went through the Korean War. Our GDP as a nation per capita was below $100. Took us about 60 years to get to about $47,000. A lot of this key to success was based on two key strategies. One is what we call the geographic arbitrage. Basically, when you go abroad, when you see something nice, bring it to Korea and then nationalize it. Manufacture locally, source locally. That's how Samsung grew, LG grew. Second is a fast follower strategy. Oh, we saw that works in the US or some other country. Let's copy that, copy their pricing, copy their website.

John Kim: The sad story is there's two strategies I told you, the fast follower, geographic arbitrage. That strategy does not work when you're trying to go to the country that you copied from. You have to go there and actually win with differentiation rather than being, you know, better, faster, cheaper.

Three things. One, what we'd like to do was previously like, oh, there's a company in the US, Facebook, let's copy that. Let's, there's a YouTube, let's copy that. Like you can't do that anymore. Start with a customer's problem. It's really focusing on customer's problem. And one of the two things that they teach at YC is don't do anything, but especially if you're early stage, is to build product and talk to customers. Don't go to networking events. Focus on the customer's problem, talk to them. If you're not talking to your customers, target customers 2 to 3 times a day in the seed stage, you got to do a lot more. I was talking literally, I have 3 customer calls every single day. I still do maybe 1 call a day. I still do that. I do direct selling.

John Kim: Second is, again, don't focus on what's proven and try to make it cheaper or localized. Try to focus on what you can differentiate in the most competitive and largest market possible. So when the market expands and grows or they try to come to your country, like you know, you still have a differentiated value proposition that can defend against them.

Really, a lot of people make what we call on the left side, the consensus-driven decision. We have a discussion, committee, like, oh, this seems right. Let's do it. This is where everyone else is. So there's no moat, there's no alpha that you have. If everyone thinks it's the wrong thing to do, you're not going to do it. So obviously nobody's doing it because there's no value.

Really, the only alpha you have as a startup founder is focusing on the top right one. When everyone else thinks it's the wrong thing to do, but you're the only one that thinks there's an opportunity for your company and you have to be right. But more often than not, you will be wrong. But really focusing on this, really looking for the insight. And the only way to get an insight is by talking to customers.

John Kim: Third, hopefully you resonate this with a lot, especially around collectivistic culture. Psychology, they call this a low context culture versus high context culture. Low context, think of America, maybe a little bit of German, Scandinavian countries, very explicit and direct communication to a point where it feels offending responsibility. So what happens is that the speaker, you have to be a clear communicator. If you're a manager, you have to set expectation clearly. The job is the leader is to communicate clearly and so the responsibility of the communication lies on the speaker.

High context culture is the opposite. It's very implicit, indirect, you kind of should know what your manager wants. They're not going to tell you directly. So you have to kind of understand, OK, that person's generally like this, so I should do this. So the responsibility lies in the listener and this is the biggest difference. Found more in collectivistic countries like Korea, Japan and China, Arab.

So what happens is you end up having things like this. When you're going to a client meeting, boss will not tell you, you have to book 3 different restaurants because you don't know which one he's going to go to or she's going to go to. And then the moment the person chooses a restaurant, you have to call the restaurants and cancel their reservation because the responsibility is on the listener and the junior to figure out what your boss wants without the boss telling you what they want, which is very annoying and I think it's inefficient.

John Kim: And, lastly, is getting out of your personal cultural comfort zone. Like I faced this a lot. Like, I mean, when I first came to the US I read this article written by some Israeli guy saying, hey, how to soft landing in Silicon Valley. Basically, the core of the lesson is like, don't get a house where other, your race lives. So I specifically chose a city where there is the least amount of Koreans. So I feel like if I go to where there are a bunch of Koreans, I'm just gonna hang out and drink all the time. I had to like really get out of my comfort zone.

So I started attending these like kind of networking events to sell, but as you can see, almost everyone's like non-Asian. I'm here. I had to force myself to go to this, hold on to a bottle of beer for two hours, but I have to like go and learn how to sell to these non-Korean people and I forced myself to do it. So get out of your comfort zone.

John Kim: So I'll leave you with this, kind of building the global playbook. I kind of skimmed through Sendbird's journey. There was like almost 4 years of nothingness, 2.5 years. Finding product-market fit takes a long time and that's normal. On average, I think YC companies take about 3 years to find their first product-market fit. So it's a really long dark tunnel of faith. The pivots and pivots and just have faith and keep going. Don't give up.

I like to call it this 2 p.m. framework, how to help build your startup global initiative. Really, it's about this virtuous cycle of People, Product, Market, Money. So first, do you have the right team? You have to like really be honest with yourself as founders, right team to tackle the market and the customer and really find the missionaries, not the mercenary. Don't partner with somebody who's going to jump ship. Oh, I got a better job. You have to really find the people who are passionate, who share those core values with you. So that founder-product-market alignment is super important.

John Kim: If I go back to the story briefly, Smile Moms, we're building moms app by 4 dudes in Korea, targeting US moms. Clearly, it's the dumbest idea ever. We actually got a quarter million users, but we couldn't grow. The founder-product-market, there wasn't really strong alignment. This happens a lot with smart founders. They think there's a cool AI trend, so I'm just going to do an AI. I actually don't care about AI, but this is where the money is, I'm just going to do it. Crypto, I'm just going to do a crypto startup because that's where the money is. Everyone's into it. I care nothing about digital currency or blockchain, but I'm just going to do it because that's where the money is.

Classic founder-market-product misalignment issues because after 2 to 3 years, that hype will die down and you're just going to give up because it's not very interesting to you. So don't follow the trend, follow what's really meaningful to you. You might be able to hold on to it longer.

Second, building the MVP, finding product-market fit takes a lot of iterations. Assume whatever you do, you're going to throw away 70% of your work. Tell this to your engineers, tell this to your designers. Hey, your work, by the way, 70%, more like 80%, they never get used by your customer. So just be ready for that iteration.

John Kim: Thirdly, really obsess over your customer problems. In most cases, your vision should come from market and the customer, not your technology, not your shiny little thing, unless you're Sam Altman and with AI then you get the right to find your vision from technology. Almost all of you should never do that. Focus and find your vision from the market you're trying to go after, the customer's problem. That should be the vision because your product and solutions can change, but that problem still exists.

So I love this framework, customer development process. Basically, there's two phases, right? There's search and build where there's a lot of iteration that happens. And then once you find like initial product market fit, that's when you actually go hire, build, scale. But this first part should be done by a very small set of nimble people, like 4 people, 5 people. Just go iterate, talk to customers all the time. You're throwing away 80% of your work here. But once you feel like, OK, I think we got something. We got something that repeats. We have a couple of paying customers now, they're willing to give us more money than we deserve. They're willing to buy from us when we actually don't have a product. That's a good sign. When you have that, you're ready to scale your customers.

Lastly, money, you have the budget, funding. Make sure you've got all those things right. Pricing model, it's something that people don't think a lot about. They just copy competitors' website and discount it by 20%. Like that's OK. But really think about pricing a lot cause pricing has the highest correlation to your growth rate, your gross margin, ultimately your company's valuation. A lot of early-stage founders only think about the growth rate. They don't think about retention, pricing, all that gross margin. Serious mistake.

John Kim: So in history, people thought it's impossible to run 1 mile in under 4 minutes. Humans cannot do it. Then until this guy showed up, Roger, first person in human history to run a mile in less than 4 minutes. After that, immediately, over 1000 people broke this record.

So our job here is to show the rest that it can be done. People make businesses here. We have nothing short. We are different, but we too can build massive companies here. And, yeah, going global was not a choice for us. Our only path to survival, and we too can achieve global optimum by doing this together. So thank you for listening. That's it.