As a SaaS guy, I use a wide number of SaaS applications to run my business. Back when I was at FreshBooks, the finance team thought I was torturing them by always introducing new SaaS tools to streamline our workflow. One of the tools that I use to keep on top of email is Sanebox. This helps filter out non important emails so that I can be more responsive with the important stuff.
I got this message in my inbox from them yesterday: Continue reading Only ask customers to make one buying decision
I was reading this morning about Slack‘s rumoured $ 160M round, coming hot on the heels of last Fall’s $ 120M round. If this round closes then in the space of 7 months the company will have raised $ 280M and grown it’s valuation over 10x from the previous funding rounds.
This is a beautiful illustration of the importance of momentum in building a valuable company. Most startups take some time to find their stride. But once they find product/ market fit and scalable customer acquisition channels, the market-leading startups seemingly never stop raising capital. Instead, they raise more money, quicker to keep piling on to the growth they already have. This is why in most markets, the bulk of the market value goes to the leader. There’s just such a huge gap between that company and the ‘also rans’.
If you’re a student of marketing then you’ve likely heard of the ‘four Ps’. A lesser known, but I’d say more important set of Ps are the three Ps of funding. Why are they more important? Without them, you won’t have any money to pay for all that marketing.
People
In Jim Collin’s seminal book ‘Good to Great‘, the companies he profiled all started by getting ‘the right people on the bus’. All great companies begin and end with great people. In the context of funding a startup, investors are looking for any of the following: Continue reading The Three Ps of Venture Funding
Back when I was a seed VC I was fond of telling folks that they didn’t have a company yet. I wasn’t trying to be mean. I was trying to instill ruthless focus. Seed rounds are small and runway is measured in iteration cycles. How quickly can you iterate till you have product / market fit?
In my books there are three stages to building a startup. And only the last one has anything do with a company.
Stage 1: Project
You have an idea. You research to test and validate hypotheses and find a pain point in the market. You start building wireframes and mockups. You maybe start collaborating with someone. At this stage you have a project.
Stage 2: Product Continue reading The Three Stages of a Startup