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Mar 9, 2017 · 20m · top-founders

EP 593: XOR Data Announcing $2m Funding Round Live, Invested $800k Before Any Revenue with CEO Mike Cook

Mike Cook · 9m spoken Nathan Latka · 8m spoken
0:00 / 0:00

gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions

In this episode of The Top, host Nathan Latka interviews Mike Cook, founder and CEO of XOR Data Exchange, who announces an exclusive $2 million Series A extension. Cook discusses his distributed data architecture, transactional monetization model, bootstrap journey, and XOR's operational trajectory toward 2017 profitability.

How this conversation actually went

Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Nathan holds 45.6% of the talking time here. How this is scored →

Nathan as informed peer 5.4 Guest teaching 4.4 Guest disagreement 1.4 Nathan pushing back 3.6
05100:0010:0020:001:37–3:37 · Nathan as informed peer 4/10 Introducing Mike Cook and XOR Data Exchange Mission Nathan asks Mike to simplify XOR's technical value proposition. Mike explains how enterprises avoid traditional data brokers to retain data control, while Nathan clarifies the B2B scope.3:37–6:24 · Nathan as informed peer 5/10 Distributed Data Architecture and Enterprise Cybersecurity Model Nathan proposes a hypothetical central pipe between JPMorgan Chase and AIG. Mike educates Nathan by reframing the model from a centralized data repository into a decentralized exchange operating entirely behind corporate firewalls.6:26–9:54 · Nathan as informed peer 5/10 Transactional Revenue Model and Industry Exchange Consortiums Nathan drills into XOR's transaction-based pricing mechanics and historical timeline. Mike shares his background selling ID Analytics to LifeLock and investing $800k of personal capital into XOR.9:54–13:15 · Nathan as informed peer 7/10 Live Funding Announcement and Capital Strategy Insights Mike reveals a live $2M extension to their Series A round. Nathan sharply questions how Mike managed to convince investors to accept the exact same valuation terms 18 months later despite reduced execution risk.13:15–16:07 · Nathan as informed peer 6/10 Lean Team Structure, Market Reach, and Profitability Nathan asks about enterprise customer count and team economics. Nathan calculates estimated operational payroll to deduct XOR's 2017 breakeven revenue threshold of over $1M.1:37–3:37 · Guest teaching 5/10 Introducing Mike Cook and XOR Data Exchange Mission Nathan asks Mike to simplify XOR's technical value proposition. Mike explains how enterprises avoid traditional data brokers to retain data control, while Nathan clarifies the B2B scope.3:37–6:24 · Guest teaching 7/10 Distributed Data Architecture and Enterprise Cybersecurity Model Nathan proposes a hypothetical central pipe between JPMorgan Chase and AIG. Mike educates Nathan by reframing the model from a centralized data repository into a decentralized exchange operating entirely behind corporate firewalls.6:26–9:54 · Guest teaching 3/10 Transactional Revenue Model and Industry Exchange Consortiums Nathan drills into XOR's transaction-based pricing mechanics and historical timeline. Mike shares his background selling ID Analytics to LifeLock and investing $800k of personal capital into XOR.9:54–13:15 · Guest teaching 4/10 Live Funding Announcement and Capital Strategy Insights Mike reveals a live $2M extension to their Series A round. Nathan sharply questions how Mike managed to convince investors to accept the exact same valuation terms 18 months later despite reduced execution risk.13:15–16:07 · Guest teaching 3/10 Lean Team Structure, Market Reach, and Profitability Nathan asks about enterprise customer count and team economics. Nathan calculates estimated operational payroll to deduct XOR's 2017 breakeven revenue threshold of over $1M.1:37–3:37 · Guest disagreement 1/10 Introducing Mike Cook and XOR Data Exchange Mission Nathan asks Mike to simplify XOR's technical value proposition. Mike explains how enterprises avoid traditional data brokers to retain data control, while Nathan clarifies the B2B scope.3:37–6:24 · Guest disagreement 2/10 Distributed Data Architecture and Enterprise Cybersecurity Model Nathan proposes a hypothetical central pipe between JPMorgan Chase and AIG. Mike educates Nathan by reframing the model from a centralized data repository into a decentralized exchange operating entirely behind corporate firewalls.6:26–9:54 · Guest disagreement 1/10 Transactional Revenue Model and Industry Exchange Consortiums Nathan drills into XOR's transaction-based pricing mechanics and historical timeline. Mike shares his background selling ID Analytics to LifeLock and investing $800k of personal capital into XOR.9:54–13:15 · Guest disagreement 2/10 Live Funding Announcement and Capital Strategy Insights Mike reveals a live $2M extension to their Series A round. Nathan sharply questions how Mike managed to convince investors to accept the exact same valuation terms 18 months later despite reduced execution risk.13:15–16:07 · Guest disagreement 1/10 Lean Team Structure, Market Reach, and Profitability Nathan asks about enterprise customer count and team economics. Nathan calculates estimated operational payroll to deduct XOR's 2017 breakeven revenue threshold of over $1M.1:37–3:37 · Nathan pushing back 2/10 Introducing Mike Cook and XOR Data Exchange Mission Nathan asks Mike to simplify XOR's technical value proposition. Mike explains how enterprises avoid traditional data brokers to retain data control, while Nathan clarifies the B2B scope.3:37–6:24 · Nathan pushing back 3/10 Distributed Data Architecture and Enterprise Cybersecurity Model Nathan proposes a hypothetical central pipe between JPMorgan Chase and AIG. Mike educates Nathan by reframing the model from a centralized data repository into a decentralized exchange operating entirely behind corporate firewalls.6:26–9:54 · Nathan pushing back 3/10 Transactional Revenue Model and Industry Exchange Consortiums Nathan drills into XOR's transaction-based pricing mechanics and historical timeline. Mike shares his background selling ID Analytics to LifeLock and investing $800k of personal capital into XOR.9:54–13:15 · Nathan pushing back 6/10 Live Funding Announcement and Capital Strategy Insights Mike reveals a live $2M extension to their Series A round. Nathan sharply questions how Mike managed to convince investors to accept the exact same valuation terms 18 months later despite reduced execution risk.13:15–16:07 · Nathan pushing back 4/10 Lean Team Structure, Market Reach, and Profitability Nathan asks about enterprise customer count and team economics. Nathan calculates estimated operational payroll to deduct XOR's 2017 breakeven revenue threshold of over $1M.

speaking balance: gold is Nathan, purple is the guest (3 minute bins)

0:00 · Nathan 70.5% · guest 29.5%0:00 · Nathan 70.5% · guest 29.5%3:00 · Nathan 22.8% · guest 77.2%3:00 · Nathan 22.8% · guest 77.2%6:00 · Nathan 23.8% · guest 76.2%6:00 · Nathan 23.8% · guest 76.2%9:00 · Nathan 30.8% · guest 69.2%9:00 · Nathan 30.8% · guest 69.2%12:00 · Nathan 32% · guest 68%12:00 · Nathan 32% · guest 68%15:00 · Nathan 63.2% · guest 36.8%15:00 · Nathan 63.2% · guest 36.8%18:00 · Nathan 83.7% · guest 16.3%18:00 · Nathan 83.7% · guest 16.3%
Sharpest disagreement ▶ 12:25 Rejecting the Series B VC hype cycle

Mike rejects conventional Series B fundraising pressure by critiquing collapsing unicorn valuations and explaining why taking an insider extension is smarter for business focus.

 Hardest push from Nathan ▶ 12:06 Challenging flat-valuation round mechanics

Nathan directly challenges Mike on the fairness to early investors of allowing new capital in at identical terms 18 months later with far less risk.

 Biggest teaching moment ▶ 5:28 Decentralized architecture vs traditional data broker

Mike corrects Nathan's 'central pipe' mental model by explaining that XOR never aggregates or stores data, keeping queries strictly behind enterprise firewalls.

 Nathan holds their own ▶ 15:36 Deducing revenue targets from payroll math

Nathan demonstrates operational fluency by multiplying specialized developer headcounts and salary estimates to extract Mike's unstated $1M+ 2017 breakeven milestone.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Introducing Mike Cook and XOR Data Exchange Mission 4512 Nathan asks Mike to simplify XOR's technical value proposition. Mike explains how enterprises avoid traditional data brokers to retain data control, while Nathan clarifies the B2B scope.
Distributed Data Architecture and Enterprise Cybersecurity Model 5723 Nathan proposes a hypothetical central pipe between JPMorgan Chase and AIG. Mike educates Nathan by reframing the model from a centralized data repository into a decentralized exchange operating entirely behind corporate firewalls.
Transactional Revenue Model and Industry Exchange Consortiums 5313 Nathan drills into XOR's transaction-based pricing mechanics and historical timeline. Mike shares his background selling ID Analytics to LifeLock and investing $800k of personal capital into XOR.
Live Funding Announcement and Capital Strategy Insights 7426 Mike reveals a live $2M extension to their Series A round. Nathan sharply questions how Mike managed to convince investors to accept the exact same valuation terms 18 months later despite reduced execution risk.
Lean Team Structure, Market Reach, and Profitability 6314 Nathan asks about enterprise customer count and team economics. Nathan calculates estimated operational payroll to deduct XOR's 2017 breakeven revenue threshold of over $1M.

Statements from this episode (8)

Opinion
Large Enterprises Distrust Traditional Credit Bureaus and Data Brokers, Says Cook
“They don't like sharing that data through the traditional sources today, like through the big three bureaus or through data, data brokers like LexisNexis, because they don't really have a lot of accountability. They can't really see where that data goes.”
Mike Cook Mar 9, 2017 ▶ 2:26
Disclosure
XOR's Distributed Architecture Keeps Data Behind Client Firewalls
“We're trying to create different data systems where for instance, in that example, we would try and say, hey, let's do this through a distributed exchange. Chase, all of that data you have on your customers, you hold it behind your firewall. AIG, same thing. Y…”
Mike Cook Mar 9, 2017 ▶ 5:53
Disclosure
XOR is Building a Subscription Fraud Exchange for Financial Services
“We're building a new exchange for, we're focusing on big financial services companies where they can exchange fraud information and in that exchange, we are going to do more of a subscription-based model”
Mike Cook Mar 9, 2017 ▶ 7:38
Disclosure
Mike Cook Personally Invested $800k in XOR Data Exchange Before Revenue
“And what I did is, is, is I put in 800,000 dollars on my own money over the first year.”
Mike Cook Mar 9, 2017 ▶ 8:26
Disclosure
XOR Data Exchange Announces $2 Million Funding Round Live on Air
“And we're going to close on another two million here today.”
Mike Cook Mar 9, 2017 ▶ 10:15
Disclosure
XOR Raised $1.8M Seed Debt and $4.2M Series A
“We did a 1.8 convertible debt early for seed. We did a 4.2 on NA.”
Mike Cook Mar 9, 2017 ▶ 10:58
Opinion
Falling Unicorn Valuations Are Making Series B Rounds Harder to Raise
“The unicorns come out, and here's our high valuations. Well, their valuations are coming down. And I think that kind of hurts the VC marketplace. So raising series B is, is more difficult.”
Mike Cook Mar 9, 2017 ▶ 12:48
Prediction Not checkable as stated
Cook Predicts XOR Will Be Cash Flow Positive by End of 2017
“So for me, when we exit 2017, we will be cashflow positive.”
Mike Cook Mar 9, 2017 ▶ 15:15
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