Both Sides of the Table

APRIL 20, 2017

So how did a company that provides storage grow so fast (we’ll exit 2017 with 10’s of millions in recurring revenue), why is it so defensible and is it really a tech startup? years of software development. Today I’m excited to announce we’ve recently raised $30 million in growth finance led by 8VC , with Kimmy Scotti joining our board.

Technical Review 268

Technical Review Los Angeles Software Review Artificial Inteligence 268

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NOVEMBER 3, 2009

That died with waterfall software development. Let’s take your revenue line. Do you really want to spent $100k building a product to discover through Customer Development that the market is too small? How will your costs scale as your revenue scales. Or lower revenue assumptions. Do so at your peril.

Business Plan 334

Business Plan AJAX Venture Capital Technical Review 334

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AUGUST 8, 2009

Your friends and advisers tell you that this means you need revenue because in this economy VC’s will only fund businesses with revenue. So if it’s not necessarily revenue that’s preventing an investment, then WTF is traction? Funding is about developing a relationship over time.

Technical Review 309

Technical Review Term Sheet Venture Capital Revenue 309

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SEPTEMBER 22, 2012

So investing $3-5 million in a company and taking a year to 18 months to see how it develops before adding more fuel can often be the right course of action. We worked with police departments, the ministry of defense, many of the largest utility companies in Europe and a ton of contractors, engineers, architects, developers and suppliers.

Silicon Valley 390

Silicon Valley Venture Capital Startup Technical Review 390

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APRIL 20, 2010

Some CTO’s swear that it is a huge improvement in development timeframes and doesn’t cause performance issues. They often aren’t great at planning development work. They should be setting the standards for how code is developed. For me the inflection point is usually when you have 5+ developers.

Fractional CTO 400

Fractional CTO CTO Hire Fractional VPE Part-Time VPE 400

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NOVEMBER 14, 2017

Throughout the first year we made many fixes and saw our revenue base in these markets accelerate so we felt we were ready to attack Los Angeles, amongst the most important storage markets in the country. An example of the systems companies build are pricing & revenue management tools to best help to optimize yield.

Operations 286

Operations New York City Technical Review Startup 286

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OCTOBER 19, 2014

So when they spoke about character development, repeatable gaming experiences, bringing games to multiple platforms (in the industry we call this “ Transmedia “) and physical products my ears naturally perked up. Again, I think the company would slug me if released revenue data, but … wow. And Seriously.

Technical Review 373

Technical Review North America Los Angeles Cofounder 373

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APRIL 4, 2011

And given your stage of development you sure better at least know what your goal is. For example, if you have developers, content people or SEO folks working on SEO programs you’ll need to allocate their time / costs to this effort. Revenue Metrics. I like to think of revenue drivers. That’s not acceptable.

Metrics 346

Metrics Startup Acquisition SEM 346

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APRIL 18, 2019

The company started the year with no revenue and at it’s peak had a run rate well in excessive of $100 million / year. As drivers we look out for them, as pedestrians we might be annoyed if they steer in our way but the riders themselves have developed better norms as happens in all forms of transportation. they were highly visible.

South America 250

South America Global New York City Software Review 250

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MARCH 30, 2010

Burstly, a Santa Monica based company, provides an open and free ad management platform that helps mobile application developers better monetize their inventory. But I believe it’s a very comprehensive solution and our due diligence with large app developers confirmed as much. I’ll explain in detail below. Enter Burstly.

Mobile 282

Mobile Management Southern California Application Development 282

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JULY 14, 2010

Here’s how it goes: You have a business development group with two people. You can often measure how many deals were achieved but there often doesn’t flow a steady stream of revenues / profits from these deals. You have a marketing department with three people. They’re tasked with doing … marketing.

Development Team Review 323

Development Team Review SEM Channel Social Media 323

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DECEMBER 19, 2011

As a software developer I wrote code on what was called a “dumb terminal” because it literally had no processing capability. We had to develop whole frameworks of “middleware” to deal with this problem. But for software developers like my company the web was a blessing. Social networking is peaking.

Web 355

Web AJAX Distribution HTML 355

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APRIL 26, 2016

I’m sure there are way more detailed blogs than this one that can help you with a deep dive on CAC methodologies — my point is the bring the issue to the attention of more early-stage founders who probably aren’t developing enough cycles to thinking about metrics. In SaaS (or any recurring revenue business) this is also a very difficult task.

Metrics 150

Metrics Cost Acquisition Startup 150

Both Sides of the Table

OCTOBER 29, 2009

Many people have speculated a variety of revenue sources such as charging 3rd parties for their data, charging power users for their accounts, charging “verified users&# for their certified accounts, etc. A healthy eco-system of application developers is required for any software or Internet company to be massively successful.

Technical Review 286

Technical Review Advertising Early Stage Internet 286

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AUGUST 28, 2009

Our business development discussions took longer than planned. We downsized, developed processes and found our groove. We downsized, developed processes and found our groove. I think the fondest memories and bonds in life are developed between people who go through shit like this all together and come out survivors.

PR 331

PR Software Review Ireland Germany 331

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FEBRUARY 9, 2013

In the tech world we are breeding a bit of a culture where we have entrepreneurs who are conference famous but have small have small revenues and red ink. We had lots of debates about the tech world and about career development. That makes no sense. And neither of these cultures is a good thing. **. Back story on photo. And I like it.

Software Review 398

Software Review Technical Review China Mexico 398

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SEPTEMBER 19, 2011

The reason that incumbents can’t react is that their revenue and defensibility are continued by serving the high-end of the market for which it would take too much time & money for any competitors to effectively challenge. It’s the most profound book I’ve read on thinking about how the Internet is changing business.

Los Angeles 329

Los Angeles Revenue Retention Acquisition 329

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MAY 19, 2010

Founded in November 2007 in New York City by Alexis Maybank and Kevin Ryan (co-founder of DoubleClick); CEO is Susan Lyne (ex-CEO Marta Stewart Living Omnimedia) Revenue estimates: $50mm in 2008; $170mm in 2009 (versus budget of $150mm); $450mm forecasted for 2010. Note that these are “gross” revenue numbers. OTHER DEALS: 1.

Partner 240

Partner New York City Cofounder Syndicate 240

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MAY 19, 2013

He worked his ass off and delivered an amazing technical infrastructure to support a “big data meets social analytics” platform that could be used by any developer. Yet our initial customer success didn’t translate into big revenue growth and we faced issues such as: Do we support developers, end-users or both?

Technical Review 303

Technical Review Cofounder Analytics Founder 303

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JUNE 18, 2015

Everyone is a rock star developers, every company is crushing it and when they’re not crushing it they’re killing it. Do fewer business development deals but make the ones you do have more impact. They’re doing how much in SaaS revenue? And do the things that you ARE doing better and with higher quality.

Software Review 150

Software Review Turkey Portfolio Syndicate 150

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MARCH 25, 2016

It turns out that to build a successful company you ultimately need this strange thing called “revenue” that people don’t just hand you: You need to earn it. And there’s this other thing called “gross margin,” which shows the quality of your revenue. How much ad revenue does TripAdvisor make?

Startup 150

Startup Seed Money DC Software Review 150

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JULY 6, 2016

Could Korea’s largest companies increase their funding of startups and provide them with initial business development deals as so often happens in Silicon Valley? Could leaders of society try to change the culture in ways that encourage acceptance of failure? Could big business accept its own creative destruction?

South Korea 261

South Korea Silicon Valley Los Angeles Japan 261

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APRIL 3, 2014

We have 12 developers and they have 3. Sales people will often sell future development work. That’s the most important thing in your business to get revenues up. “Sure, they can sell at 50% of our price. Their customer support is much smaller and therefore won’t be able to respond to your needs as quickly.

Sales 382

Sales Startup Technical Review Matching 382

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JUNE 22, 2015

Why Exclusivity Matters to Your Customers or Business Development Partners. So often exclusivity on mega deals is of huge importance to your potential customers or business development partners. I have often asked for funding for this accelerated development.

PR 150

PR Early Stage Software Naming 150

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MAY 6, 2018

As a VC with scores of startups in our portfolio we have ringside seats to many, many fund raising processes plus I had to raise money across about 5 different rounds of capital as an entrepreneur so I’ve developed some thought on the process that I hope can be helpful to some of you before you start. Let me give you an example.

Revenue 236

Revenue Valuation Portfolio Restful 236

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MARCH 17, 2011

If you develop something novel that catches a spark you’ll have the world gunning for you over night. I might be grooming them for when I have more money or more revenue. Don’t promise revenue or growth faster than you know you can achieve. In this globally connected world product leads disappear in nano-seconds.

Hiring 399

Hiring Startup Global Revenue 399

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NOVEMBER 19, 2009

But “he didn’t have the budget to hire a developer until he had raised money!&#. He went out and found a developer and built a product. The company had less than $5 million in revenue yet we had a multi-tab spreadsheet doing activity-based costing on our customer service staff, operations and technology.

Entrepreneur 414

Entrepreneur Fractional CTO Technical Review CTO Hire 414

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MAY 7, 2013

My estimate is that the top 5 YouTube networks will do > $200 million net revenue in 2013 (after Google’s share). Distribution costs have, too. This is classic “Innovator’s Dilemma” market conditions.

Video 320

Video Los Angeles Technical Cofounder CTO Hire 320

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DECEMBER 16, 2009

We couldn’t cut product development (we had 23 people!) I either need to cut product development staff (and therefore can’t ship products as promised) or I need to be able to charge you slightly more for our service or for features you want to see so that I can make ends meet. I went through more examples.

Entrepreneur 306

Entrepreneur Burn Rate Cofounder Sales 306

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SEPTEMBER 13, 2011

You can always spot these types because they can’t tell you what their revenue number for last month was or what their sales target is for next month. I had heads of sales, marketing, business development, product management, technology and customer service.

Technical Review 325

Technical Review Startup Cofounder Due Diligence 325

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JULY 16, 2013

Because at least while the VC spigot is open and flowing for high-potential individuals that fit a pattern that some VCs seem to favor they can access cheap capital that isn’t terribly dilutive and can use the to fund development and swing for the fences with limited focus on monetization. That leaves 99.99% of you. I see this weekly.

Burn Rate 412

Burn Rate Dilution Revenue Valuation 412

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JANUARY 19, 2015

YouTube takes too high of a revenue split (45% vs. 30% that Apple and many other distribution companies take – FWIW, YouTube argues this is because their costs are much higher since they host and stream the video). And here’s the thing … YouTube PAYS YOU to develop these audiences.

SEM 150

SEM Los Angeles Silicon Valley Acquisition 150

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OCTOBER 15, 2014

I first met Nick Halstead in 2009 when he was running a company called Tweetmeme (the predecessor to DataSift) who had invented the Retweet button and actually helped Twitter develop its early API. He explained to me much of the Twitter infrastructure and why Twitter data would become super valuable.

Founder 309

Founder CTO Hire Silicon Valley Leadership 309

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JULY 23, 2014

Cheap, mobile, social, global, massive, always-on, one-click-purchase has led to the most successful companies of our era hitting unprecedented scale early in their development and has massively shifted the value captured from post-IPO investors to pre-IPO investors as is demonstrated in the chart above. and hasn’t abated.

Technical Review 398

Technical Review Venture Capital Valuation Pre-Money Valuation 398

Both Sides of the Table

FEBRUARY 5, 2011

We have 12 developers and they have 3. Sales people will often sell future development work. That’s the most important thing in your business to get revenues up. “Sure, they can sell at 50% of our price. Their customer support is much smaller and therefore won’t be able to respond to your needs as quickly.

Sales 316

Sales Technical Review Matching Hiring 316

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SEPTEMBER 15, 2013

Along with Greycroft Partners we were the first investors in Maker Studios 3 years ago when the company had no revenue and limited infrastructure. but not that this justifies take a 45% revenue share. Industry averages for talent revenue shares are about 70% with top talent making even more. ” YouTube takes 45%.

Networking 366

Networking Media Distribution Video 366

Both Sides of the Table

OCTOBER 17, 2019

Invoca is now doing 10s of millions in recurring revenue and is growing > 75% year-over-year but it took the first 3 years to really build out the technology and acquire our initial enterprise clients. I mentioned that we sold our position in Kyriba for > $1 billion but when we invested it had virtually no revenue.

IP 223

IP Intellectual Property IRR Cofounder 223