She quickly figured out how to sell their community as funding evaporated

Rebekah Bastian was running out of cash. It was April 2023, and she had less than two months to raise money for her online community, OwnTrail.

Still, the Seattle-based founder wasn’t too worried, she told GeekWire. She had already raised $1.5 million since launching the company in March 2020 with her co-founder, Kt McBratney. Plus, they had just completed Techstars Anywhere, a remote-first accelerator.

But more than 30 meetings later, during a tough fundraising environment, Bastian couldn’t find the capital — and she was forced down a different path.

Choosing her own adventure with OwnTrail

Bastian had left Zillow – a “comfortable, secure job that I loved,”  she told Insider. She gave up her $275,000 base salary and 15-year career there to focus full time on OwnTrail.

She had started the project in summer 2019 as a complement to her book, “Blaze Your Own Trail.” The choose-your-own-adventure interactive book encourages women to embrace the fact there’s not one singular life path.

OwnTrail grew into an online community where members can create experience graphs that chart professional and personal milestones. With any milestone, members can send out a Help Beacon to get the support they need from the OwnTrail community.

The community of more than 6,700 people was a safe space that allowed anyone from recent college grads to corporate executives to show up authentically and help each other out.

Bastian shared with Insider that she personally invested $100,000 into OwnTrail, and they raised $1.5 million from angel investors and The House Fund out of Berkeley, California, where she graduated from the University of California with a master’s in mechanical engineering. Bastian said in May 2022 about 90% of OwnTrail’s monthly spend went toward salaries. At sale, they had four full-time and three part-time employees.

Bastian told They Got Acquired that the biggest challenge she faced was figuring out the right engagement flywheels and free-to-paid conversion funnels. The team experimented with several different subscription models, including small support groups and, right before sale, a paid membership model.

A paid membership cost $10 a month — or $100 a year. Bastian explained that anyone could create a trail for free, but only paying members got access to additional features like Help Beacons, connecting with other members, accessing unlimited trails and more.

“We had some early signals that this model could work, but still had a ways to go in figuring out the free-to-paid conversion and B2B2C sales, and we ran out of time,” Bastian told us. The platform had about 200 paid subscribers during the pilot phase before sale.

Navigating an unexpected milestone: Selling OwnTrail

Bastian wasn’t ready to sell. She had big plans to grow the business. She could envision the impact it would make.

“The reality is, the market conditions forced me to exit earlier than I wanted,” Bastian shared on LinkedIn. “Despite just having completed Techstars, having a robust product that people love, a clear vision for what to do next and the dream team to do it, the funding just wasn’t there.”

Determined to keep OwnTrail alive, Bastian decided the best option was to sell.

In situations like this, where a startup that raised money is forced to sell before reaching its revenue potential, founders typically don’t walk away with much cash. We explain what these scenarios tend to look like here: What happens when a company sells for less than it raised?

Bastian reached out to several founders and CEOs who worked in similar spaces, and a few showed interest in acquiring OwnTrail.

“The secret ingredient was that we’d taken a very collaborative approach to building OwnTrail and formed a lot of partnerships and friendships with other founders,” Bastian told us. “I wouldn’t have been able to find multiple acquisition possibilities if we hadn’t already established those relationships.”

Ultimately, they landed on Dave Fano, CEO of the career development platform Teal. OwnTrail had partnered with Teal over the years, and they had a good relationship.

“I told him directly that I wanted to sell OwnTrail to him due to the lack of runway,” Bastian told us. “I didn’t follow any of the traditional advice about being more subtle than that, and I’m so glad. Our conversations were totally open and honest because of it.”

Bastian said she felt like Teal was the best fit because it’s on a good trajectory.

“I have a ton of trust and respect for the team, and our missions were so aligned,” she said.

Bastian worked with a law firm, and several of her advisors helped throughout the sale. It moved quickly and was wrapped up in June 2023. She said she couldn’t disclose the financial terms of the sale.

“It helped that Dave and I already knew and trusted each other,” Bastian said. “It was a pretty simple asset purchase agreement, and we didn’t go through a ton of negotiation because our goals for OwnTrail were aligned. If we hadn’t known each other, I’m sure that dynamic would have been different.”

Bastian has now joined Teal as an advisor and is also the senior vice president of product at Glowforge, a 3D laser printer.

“This is not how or when I wanted to land the plane,” she wrote on LinkedIn. “I wanted it to be a rocketship and go to the moon. And I still truly believe that, with the right resources, it could have been.”