Advice from Mark Cuban at $10,000 an hour: $1.6M in seed funding for Clarity

Eliza Kern — Tue, 04 Dec 2012 17:00:09 +0000

Investors and entrepreneurs frequently talk about the power of Silicon Valley to launch and transform companies, but it’s always been a challenge for companies outside the Valley to network and grow with their California counterparts. Enter Clarity, the company that launched in May to connect startup companies with advisors who can charge for their services, including Silicon Valley names like Mark Cuban or Dave McClure. Clarity plans to announce a $1.6 million round of seed funding Tuesday and an expanded set of products to connect more entrepreneurs with advisors.

The idea behind clarity is simple: “If you’re at a conference and threw a rock, you’d probably hit 15 amazing advisors, but if you’re in the Midwest, that might not be the case,” explained founder Dan Martell. ”Airbnb has done it for housing apartments, and the App Store has done it for games and products, and we want to do it for advice.”

Clarity allows anyone to set their hourly rates for giving advice, and allows entrepreneurs to make inquiries on anything from marketing to engineering to growth. Beginning Tuesday, entrepreneurs will also be able to post on the problems they’re facing, and get advice on who would be best to answer their questions, if they don’t have a particular person in mind.

Ryan Kim explained how Clarity functions when the company launched in May:

The way it works is that users sign up with their Facebook account and find experts on various topic pages. Or a new user can just submit a question and Clarity will suggest relevant advisors. When they’re ready to reach out, users explain the reason for their call in the web app and Clarity then connects the call to an advisor, whose number is kept private. The advisor, who can see the reason for the call as it comes in, can choose to take the call or add the person to a call back list. Or they can offer a scheduling widget so users can slot themselves into open blocks of time.

Martell said the product has been successful and profitable so far, and the seed funding will allow them to keep growing while adding new services. He said Clarity has grown from about 1,200 advisors at launch to about 7,000 right now, and facilitated 12,000 phone calls from people in over 47 countries. Advisors can choose to offer advice for free (about 50 percent do this) or take compensation for their time. Of those who take compensation, about 30 percent have chosen to donate their profits to charity, an option which means Clarity takes a smaller transaction fee (4 percent instead of 15 percent.) Users can leave reviews and ratings for advisors, giving some quality control to the system, and meaning people who give poor advice might not get repeat customers.

Martell said the average advisor charges $250 an hour for his or her services, although startup celebrities sometimes charge more if they’re getting mobbed by entrepreneurs and need to decrease demand. For instance, Mark Cuban charges $10,000 an hour, and Eric Ries charges about $1,000 an hour — prices Martell says some people are certainly willing to pay.

“The coolest thing is I think we’ve started building a community of entrepreneurs and investors,” he said, noting that about 98 percent of calls occur between two people who’ve never met before, and especially with foreign entrepreneurs. It can be a great way for a Canadian startup, for instance, to find people in Canada who are willing to give advice on growth in that particular area.

Investors in the new seed round include Baseline Ventures, Freestyle Capital, Mark Cuban, Real Ventures, Version One Ventures, 500 Startups, Venture 51, Ariel Poler, Howard Lindzon, Gerry Pond and Haroon Mokhtarzada.

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Advice from Mark Cuban at $10,000 an hour: $1.6M in seed funding for Clarity