Conviction

Conviction: This is a word we use a lot at FreshBooks. Why? Well, not because we like to hire ex-convicts, but because we are building a company for the long term and want to be a long term leader in our market.

When you look at the World through that lens it clarifies things.  You realize first of all how difficult it is to build an enduring market-leading technology company. CB Insights published some stats last week telling us that 2 out of 3 tech exits last year were startups selling at Series A or earlier. That’s just the companies that even get to exit. If you lump in outright failures on top then what you realize is very few companies get past series A and become true growth stage companies. Even fewer become profitable, stand alone market leaders.

Continue reading

Two keys to building a massive SMB startup

Late last year, I wrote about SMB being the “third market” for VCs. Lots of VCs fund consumer startups. Lots fund enterprise startups. Very few truly target startups serving the small business market. Why?

The challenge and opportunity for startups targeting SMB is customer acquisition: there are 30 million small businesses in the US alone; 60M in the English-speaking World. Moreover, SMB is an evergreen market – more and more businesses start each year, more than replacing those that die. So, lots of customers, but historically they have been hard and costly to reach.

As such, VCs tend to be skeptical about a startup’s ability to acquire customers profitably. This concern has two vectors: customer acquisition cost & customer lifetime value. This last point is related to churn – the rate at which your customers cancel their accounts. Enterprise startups keep their customers for many years. And each customer is worth a lot. SMB startups keep customers for a much shorter period of time. And each customer is worth relatively little.

Continue reading

Stripe’s funding: Go big or go home!

I was just reading about Stripe‘s $ 80M investment today (full disclosure: Stripe is a partner of FreshBooks where I work. And we love them…). They raised $ 80M at a $ 1.75B pre-money valuation. So, what am I thinking about this?

  • YCombinator has yet another company in the $B club
  • Payments is super hot right now. Braintree was recently bought for $ 800M. The business of moving money around has never been hotter.
  • Stripe has no choice now but to go for a unicorn size outcome. More on this point:

Continue reading

I’m hiring a BD Manager

I’ve been on board at FreshBooks for a few months now. We have lots of things brewing in the Biz Dev group and it’s time to expand. I’m looking for  someone to join the team. If this is you, we would love to hear from you.

Director/ Manager of Business Development

FreshBooks is the # 1 cloud accounting specialist designed exclusively for small business owners. Since 2004, we have been helping entrepreneurs make it easy to invoice, get paid and manage their business finances. To date over five million people have used our service.

The Opportunity

Continue reading