Fresh Insights

Analyses, Musings & Observations

How to manage SDR’s

I read Trish Bertuzzi’s book ‘The Sales Development Playbook’ and it was by far one of the best sales books I’ve read in a while. The book focuses heavily on building pipeline with SDR teams. This is the first post of a few I’m going to share about this book: there was so much good…
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Capital raised has less to do with founder dilution

It may seem counter-intuitive, but if a business requires a lot of equity to grow, it doesn’t necessarily mean founders will dilute away their ownership. We recently did an analysis looking at founder ownership relative to equity raised for 38 publicly traded tech companies. The data surprised us as there is no discernable relationship between…
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How ‘cash efficient’ should you be

When you’re a fast growing, cash burning startup with limited capital, cash efficiency is as important as growth. The measure of cash efficiency we like using for Series A companies is revenue/total capital invested. When you’re in early revenue, the metric will look abysmal, but as the business grows and realizes economies of scale (generally…
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Getting to IPO takes 4 to 9 years

How many rounds has it historically taken tech companies to go public? Based on the data from 125 IPO’s, the answer varies depending on industry. The data and observations are below. Software businesses need 4 rounds. On median, publicly traded software companies raised through their Series D before going public. The median software company raised $113mm…
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The data says you’ll exit inside of 10 years

How many years will it take you to exit? 10 years is the generic answer, but that’s wrong. The data says depending on what industry you’re in, it might take as long as 11 years (hardware) or as few as 4 years (payments). We looked at 126 tech companies in various industries that have IPO’d…
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How to hire B2B sales reps

Recently I read “Hire Right, Higher Profits” by Lee Salz which focuses primarily on enterprise sales rep hiring. Below are some of the key points of the book along with my commentary. Failure in B2B sales hiring is high. “the attrition rate among B2B salespeople hovers around 25 percent, while nearly 50 percent of salespeople don’t…
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The Series A Report

During the month of May, we had conversations with 45 companies about leading or following their Series A rounds. Below is aggregate data on these 45 raises — figures like revenue, valuation, and round size are medians from the conversations. The valuations and revenue multiples presented aren’t necessarily what the founders got, but rather it’s…
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Raise more money than you need

Venture is in a bubble, and inevitably, that bubble will pop. As a founder, what should you do? Well, you could do what Peter Thiel did while he was at Paypal: he raised more money than he needed. Recall Thiel was one of the founders of PayPal in 1998. PayPal went on to list on…
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Consumer tech valuations are rising

We follow 58 publicly traded internet companies in different industries including social media, marketplaces, content distribution, gaming, ecommerce, payments, and new hardware. The one thing these companies all have in common is that consumers are a customer/critical constituent in the business model. Given the diversity of industries, the multiples vary. Below is the data along…
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SaaS valuations are getting crazier

Valuations for SaaS are higher than they’ve ever been since we started keeping track of the data in Q4 2014: of the 77 SaaS companies we follow, the average public SaaS business is trading at 10.07x revenue while the median is 9.32x. The data is below. Negative EBITDA, positive cash flow. The median SaaS business had…
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