Fresh Insights

Analyses, Musings & Observations

What great cohorts look like

The holy grail of ecommerce is to grow your cohorts over time. In other words, the customers you acquire today spend even more the following year and year after that, such that your existing customer base is a source of growth. It’s a very healthy position to be in as you aren’t dependent on acquiring…
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The story of Twitter’s founding

Recently I read Nick Bolton’s book “Hatching Twitter.” It is the story of Twitter and it is fantastic. Below I paraphrased some of my favorite sections, but if there is any book about startups to read, this is it. One of the founders had started Blogger. “Ev explained that Google had approached Ev to buy…
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Profitability isnt a must to exit

I cringe writing that title because we’re sticklers for cash efficiency and achieving cash break even. However, we looked at 123 tech companies at IPO: 87 of them were not profitable (71%) and 74 were not generating positive cash flow (60%). The data and additional observations are below. Ecommerce, Hardware, and Gaming more often generate…
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The most important KPI in software

Dollar retention is the most important measure in SaaS. There are two ways to measure it: gross dollar retention and net dollar retention. Gross dollar retention looks at how much of the customer base you’ve kept year over year without including upgrades. Formulaicly, it’s ARR — downgrades — churn all divided by beginning ARR and as such it’s always…
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Lessons from a boostrapped sports data exit

We had the chance to speak to Ben Weiss, founder and CEO of Zcruit.  Zcruit was acquired by Reigning Champs in November 2017.  Ben shared his story with us and lessons from his journey are below.   What is Zcruit? Zcruit helps colleges sports teams access information on recruits.  Ben started working for the Northwestern football…
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What founders make at exit

When a startup founder shepherds his company to a successful exit (IPO), what are the paydays like? We dove into the major tech IPO’s of 2018 and 2019 to find out. Note that paydays aren’t necessarily what the founders took home at the IPO (shares are usually subject to a 6 month lockup), rather they’re…
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Lessons from an SMB exit

We caught up with Sasha Poljak, the Executive Chairman of Ximble, about Ximble’s successful exit to Paycor.  Ximble is a staff scheduling and time tracking platform used by SMB’s to organize their workforce.  Learnings from Sasha’s story are below.   Ximble was born from an observed problem.  The founder’s sister in laws was a nurse.  He…
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The story of Clario’s exit

We recently had the chance to catch up with Chris Wood, one of the founders of Clario Medical Imaging, about his successful exit to Intelerad.  Clario Medical Imaging is workflow management software for radiologists.  Learnings from Chris’ story are below.   At first, Clario was unsuccessful.  Clario started in 2005.  The company had the license…
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What to do with VC emails

If you’re a startup on angelist, crunchbase, or have had publicity, chances are good that VC are emailing you about raising money.  Here are some tips to maximize the benefit of these inquiries:   Emails from decision makers are good.  Knowing principals, managing directors, and original founders at venture funds is a good thing.   These…
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The SaaS M&A Report for 2019

We recently got Software Equity Group’s SaaS M&A report for 2019. SEG is an investment bank focused SaaS companies and they put out fantastic data on what they’re seeing in the market. Key observations from their latest report are as follows: Deal volume was a record. SaaS M&A saw 1,248 deals, up 27% compared to…
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