Here’s what I’ve learned, on start-ups #3 and #4: Pros of Experience: Better at Hiring. You now know what makes a good VP of most things. This doesn’t mean you are always a better recr...
You don’t. Instead, you drive it down. Each quarter. You can’t eliminate churn. It’s a fact of business life in selling a product with recurring revenue and thus recurring sales. You c...
I used to feel that way. I used to look at tiny little startups and wince when a founder went around talking about himself as “CEO”. But then I had to learn how to Sell to Big Customers,...
They should. The #1 job in most SaaS companies for marketing is Demand Gen. Creating demand, and managing that demand (from leads to revenue) down the funnel. And Demand Gen needs to own a n...
Oh plenty of 20 year olds are CEO of very successful public companies. E.g., Facebook, Microsoft, Snap when IPO’d. Many more if you count the age when they founded the company, not IPO dat...
No, but it is moving a bit in that direction. Google paid $380,000,000 to buy Bebop in large part just to get Diane Green to kickstart their enterprise play. She’s brought in a huge vetera...
It’s a bit odd, because you want the CEO’s incentives to be aligned with the whole company’s, not just her or his individual efforts. An annualized bonus for meeting the stretch plan i...
I do think so, outside of the F500 at least. I can tell you empirically the best VP of Sales I know were strong salespeople in the early career. Not always the #1 top salesperson, but very s...
There is no appropriate formula, but bear in mind different VCs have their own different formulas. It’s hard to tell from the outside, but VCs will often pass on an investment if you don...
It varied a lot. The first time, it took an hour or so. My co-founder and I were both working at a struggling company. It wasn’t hard to convince her. The idea to start the company may hav...
I have no real regrets about my 20s, because I needed every experience to get to wherever it is I am today. I had to go through all of them, even if some took too long, etc. But if I was str...
We bought a fairly early P85 in 2012. No Autopilot, no parking sensors, no badge on the back, almost no nothing on this early build. The seats aren’t that comfortable. The materials aren...
I’ll leave the legal and contractual answers to others. It’s tough to be fired if you control the majority of the board, voting shares, etc. More importantly though, the answer to me is ...
What’s most important is: Segment it. You’re already alluding to this. But generally, between Small, Medium and Larger customers because they will churn at different rates. Net (includin...
While GAAP rules allow some flexibility here, generally most SaaS companies include: Hosting costs. E.g., AWS. Customer support costs. The salaries and expense of your support team. A % of C...
It sure sounds small for a full-time gig. If you end up doing 250x+ like Lowercase I, you can still make a lot of money. But the one thing that’s non-obvious with small funds is they often...
In many ways, All of Them. Microsoft. Bought 86-DOS, turned into MS-DOS (which Gates did not invent), which in turn was an improved clone of CP/M. Did not invent BASIC, either. Office in man...
Let it go. This is very hard advice to take, but it’s my best advice. I’ve seen many founders who have failed who can’t let it go. They make excuses. They blame other people (this is t...
Fairly simple: Proven CEO who sold his last company for almost $2b — and wants this next one to be worth $20b+. Fast path to $100m in bookings. Well-defined, large space. See a discuss...
Be gracious. If he damaged the brand on the way out, but still made some material contributions while a co-founder, let it go. Startups are tough. Not all founders are made to go the distanc...
This is one of the great questions you will have to ask yourself as a founder. If your company does not live on, is it a failure? What if you make $1,000,000 or even $10,000,000 (!) on a sal...
The low end of market is a good place to start. If you’ve raised “multi-millions” in a Series A, then the investors don’t want you to starve. It’s time to pay yourself a real salar...
Both make sense, but are expensive. Google has made a huge push into more enterprise cloud under Diane Greene. Salesforce would bring it all together. Google has bought a number of smaller p...
The pros, and the cons, are both limited. Cons: Usually won’t carry the company or write many “second checks”. This is the biggest issue. Traditional VCs usually reserve another 1x-2x ...
Founder’s Fund is definitely seen as a top-tier fund. Perhaps even more importantly, it has truly top-tier results over multiple funds in a row. Again and again. That is much more rare tha...
Yes you can win in many cases by remaining “hidden” as CEO — but the more enterprise your customer base is, the more important getting and being out there is. Let’s contrast Box and ...
I’m not actually that good at it. Instead, I’m a good student of it. I love working with great VPs of Sales and continuing to learn how they do it, how the playbook evolves, etc. But mys...
You put them into a Get Them Back bucket and re-market to them with a dedicated program. Customers are often not gone forever. Yes, it’s really tough to lose them. But they may come back i...
Because it is at a $1,500,000,000 revenue run-rate, growing quickly, and generating significant free cash flow. It is a very, very, very good business. Irrespective of who and what the compe...
The list of problems is endless (this is the hardest part of the job), but let me try to order a few of the biggest challenges roughly based on stage: Pre-Revenue: Finding a Great Co-Founder...
You solve their problems. Large enterprise use lots of tools, widgets, and pieces of software in their businesses, but they tend to use the obvious, trusted solutions. They aren’t looking ...
Always hire a banker if you can. Yes, it will seem expensive, especially on a smaller deal. And yes, they almost never will bring a great second offer in with a bona fide, written, better of...
Hmmm. What is Elon Musk, the most successful entrepreneur of our generation, doing now? He’s sleeping in a sleeping bag at the production line of Tesla. Again. He probably rarely sees his ...
Not yet. Spotify’s direct listing took advantage of 3 factors: They did not need or want the money an IPO brings in. An IPO brings in money, often hundreds of millions or even more to inve...
This is a tougher question than it sounds. Many VCs are at their most charming and accommodating when you are raising money — they are in sales too, after all. So the larger question i...
The simple answer is you need to fire them — assuming you can legally. Ask your lawyers. The longer answer is you may need help to do it without excessive drama, and ideally, they resi...
Box is an amazing company. It is at $600m-ish ARR and $800m annualized bookings, and cash-flow positive. Amazing. Truly. https://www.boxinvestorrelations… But Dropbox is >2x larger ...
It varies widely. Most firms will have: Managing Directors / Partners. They make the decisions, and often, control the “Management Company.” And control all the fees, which flow into the...
I believe the main historical reason is that tax-advantaged stock options — so called “ISOs” — have a maximum 10-year term under the tax code. A smaller, but related issue ev...
Include everything in your Revenue; and Include only recurring contracts/revenue in your MRR. It’s really that simple. Everything that brings in a dollar this month is revenue for this mon...