The Angel VC

AUGUST 7, 2014

Product/market fit is a topic that I've touched on a few times on this blog. It's that extremely crucial but somewhat hard to define (and even harder to measure) step which every startup needs to cross as it goes from an idea to a product to a real, scalable business. It's also a very important concept for us at Point Nine Capital since we tend to look for some level of proof of product/market fit when we evaluate potential investments.

Product Marketing 133

Product Marketing Startup Marketing SaaS 133

Tom Tunguz

AUGUST 19, 2014

Though the term k-factor, a measure of the virality of an application, has waned in popularity since Facebook’s sheep-throwing glory days, the idea of spreading a product through referrals lives on. We all know a good referral mechanism when we see one. Dropbox’s invite-a-friend feature which awards free storage for both the inviter and the invited is the canonical example and resulted in torrid growth for the company.

Startup 124

Startup Management 124

Practical Advice on SaaS marketing

AUGUST 4, 2014

Lots of smaller software-as-a-service (SaaS) businesses are tempted to try to sound “corporate” or hide their real personality when they talk to prospective customers. They act impersonal, like some alien borg. They think that “sounding bigger” makes them more credible. It's a bad idea that usually doesn’t work. How can I trust you? It’s hard to gain the trust of prospective customers if the provider is faking it.

SaaS 100

SaaS Finance Subscription Payment Features 100

CloseSaaS

AUGUST 27, 2014

Want to get a free cold calling coaching session with one of Silicon Valley's leading sales experts? Get on a call with Steli Efti, deliver your pitch and get direct one-on-one coaching. Completely free and strictly limited.

Sales 52

Sales 52

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Payments

Tom Tunguz

AUGUST 27, 2014

Following this week’s post Benchmarking HubSpot’s S-1, Josh and Nikos raised an interesting question on Twitter. What are the right ways to benchmark SaaS companies from their early days through IPO? I have always used years-since-founding as the time axis to compare companies, because if I were a founder, that’s how I might think about benchmarks.

Benchmarks 113

Benchmarks Startup SaaS Revenue 113

Tom Tunguz

AUGUST 24, 2014

Does a startup’s location impact its M&A prospects? We’ve already determined there is no material difference between the follow-on financing rates by geography. But do acquirers behave similarly to investors? To answer the question, I’ve prepared three charts used Crunchbase data and focused on the seven states with more than 20 acquisitions since 2010.

Acquisition 100

Acquisition Startup Finance Government 100

Tom Tunguz

AUGUST 20, 2014

Earlier this week, Google celebrated the tenth anniversary of its IPO. I re-read the Founder’s IPO Letter and found this passage which captured so much about Google’s values: Google is not a conventional company. We do not intend to become one…We will not shy away from high-risk, high-reward projects because of short-term earnings pressure.

Education 100

Education Trends Startup Technology 100

Tom Tunguz

AUGUST 18, 2014

Consumer companies on the whole tend to grow faster and do so will less spending on sales and marketing, and research and development than SaaS companies. The chart above shows the revenue growth rates of 60 or so recent consumer and enterprise IPOs by years since founding. Enterprise/SaaS companies in the sample achieved very small revenue in their second year and grew consistently through year 8, at which point there’s a decline.

Benchmarks 100

Benchmarks SaaS compliance Enterprise 100

Tom Tunguz

AUGUST 17, 2014

If you’re a founder or potential founder and looking to raise seed capital, you’re entering possibly the most attractive period in a decade to start a business. A few weeks ago, we analyzed the impact of Series A and later stage VCs in the seed market. In the past four years, traditional VCs began to invest in seed-stage companies, which led to a rise in the number and size of seeds.

Trends 100

Trends Marketing Acquisition Investment 100

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Innovation

Tom Tunguz

AUGUST 14, 2014

Earlier this week in a post on Quartz Mark DeCambre asks the question, Are IPOs Dying Because of Huge Growth Rounds? The chart above shows the 36 year trend in the number of tech IPOs. And as DeCambre points out, so far through 2014, the ten largest startup financings have yielded about twice as much capital as the ten largest IPOs. To paraphrase Mark’s question, can startups raise just as much capital in the private markets as in the public market, without the hassle of public market regu

Venture Capital 100

Venture Capital Finance Trends Startup 100

Tom Tunguz

AUGUST 11, 2014

When I started in the venture business and met software companies, I never heard the words customer success during pitches or throughout diligence or in board meetings. A few years later, customer success has become equal in importance to sales and marketing and engineering and product within SaaS companies. The steady increasing drumbeat of the Customer Success mantra is reflected in Google search traffic, whose volumes have tripled since 2009.

Customer Success 100

Customer Success SaaS Payments Payment Services Development Team Review 100

Tom Tunguz

AUGUST 10, 2014

More than 100B mobile applications have been downloaded since the launch of the Apple iOS and Google Play stores. As the number of users, downloads and apps have exploded, the dynamics of the app store have also changed. During the past 18 months, the competitive behavior within the Free Apps section of these app stores has evolved substantially in four meaningful ways: First, the Android Play store has become substantially more welcoming to startups/new entrants than 18 months ago.

Mobile 100

Mobile Trends Startup Acquisition 100

Tom Tunguz

AUGUST 6, 2014

When starting a company, founders often decide between two structures: the S-Corp and the LLC. But, as James Surowiecki writes in “ Companies with Benefits, ” there is a new option called the B-Corporation, the Benefit Corporation. The Benefit Corporation became an option in 2010 when Maryland’s legislature signed it into law. Subsequently, nearly twenty states have followed suit including California and Delaware.

Startup 100

Startup Consulting Technology Branding 100

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Payments

Tom Tunguz

AUGUST 4, 2014

For consumer products, the power of mobile distribution is hard to overstate. Facebook serves more than 1B mobile users each month. Angry Birds reached 50M users in 35 days , a feat that took Instagram 18 months and Facebook more than 3 years. But the distribution advantages of mobile app stores hasn’t been observed as powerfully in SaaS or enterprise software for driving revenue.

Mobile 100

Mobile SaaS Enterprise Startup 100

Tom Tunguz

AUGUST 3, 2014

Through last week, 80% of fast-growing technology companies who reported Q2 earnings had met or exceeded expectations, on average by 4%. As the earnings season has progressed , the tech sector is showing impressive signs of strength and predictability in the underlying companies’ business. Startups benefit from a booming public market for three reasons.

Startup 100

Startup Trends AWS Marketing 100

CloseSaaS

AUGUST 26, 2014

Every founder, every entrepreneur, everybody who works in a startup knows the burden of the to-do list. I love to-do lists. They are a beautiful thing. They help me get things done.

Entrepreneurship 52

Entrepreneurship Startup Sales 52

CloseSaaS

AUGUST 25, 2014

As the CEO or founder of a startup, you'll someday make a decision to either grow an internal outbound sales team, or outsource it. Outsourcing sales to people who really know how to do outbound sales is a good choice. but only if the time is right!

Sales Outsourcing 52

Sales Outsourcing Outbound Sales Team Sales Startup 52

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Revenue

CloseSaaS

AUGUST 22, 2014

This might just be the fastest way to get your inbound sales kung fu up to speed. Schedule an hour of undistracted time, switch off your phone, close the other open tabs, take notes and learn.

Sales 52

Sales B2B 52

CloseSaaS

AUGUST 18, 2014

A lot of salespeople start pitching way too early in a sales call. This almost always shuts down your chances of closing a deal. Want to know how to work your way to the perfect time to pitch? And a failproof method to find out exactly how to customize your pitch for every prospect?

Sales 52

Sales 52

CloseSaaS

AUGUST 14, 2014

Want to reduce unproductive interruptions in the workplace, and improve the impression you make on others? Just avoid lazy communication, which basically means: think before you speak.

Communication 52

Communication Startup Sales 52

CloseSaaS

AUGUST 12, 2014

Imagine you're talking with a prospect that loves your product, and they would be willing to buyif only [insert objection X]. Objection X can be anything, but most commonly in sales, it's pricing. So let's use that as an example.

Pricing 52

Pricing Sales 52

As companies strive to boost revenue, deliver customer value, and stay competitive, they are increasingly embracing the potential of usage-based pricing.

Pricing

CloseSaaS

AUGUST 5, 2014

Social sales is the hot new thing in the world of B2B sales. And with good reason—most prospects have online profiles that can be a valuable source of insights for sales reps. However, most salespeople are using social sales the wrong way—and are missing out on a lot of sales because of that.

Sales 52

Sales B2B 52

CloseSaaS

AUGUST 30, 2014

Here's a recent interview Justin Mares did with me. Justin wrote Traction: A Startup Guide to Getting Customers, together with DuckDuckGo founder Gabriel Weinberg.

Interviewing 52

Interviewing Startup Sales 52

CloseSaaS

AUGUST 28, 2014

The best salespeople can change your life. Not because of what they sell you, but because of how they make you feel.

Sales 52

Sales 52

CloseSaaS

AUGUST 7, 2014

The best salespeople I know are those who are life-long learners with a true passion for communication.

Sales 52

Sales Communication 52

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Generative AI

Tom Tunguz

AUGUST 13, 2014

Yesterday, I spoke to a small group of people at Google. By coincidence, the presentation was held in the same building I used to work in, and a wave of nostalgia swept over me. Participating in Google’s speaker series brought back memories of when I was in the audience seven or eight years ago. I’ll never forget the first time I met Paul Graham in that very same room right after the first Startup School.

Investment 100

Investment Startup Scale Sales Recruiting 100

CloseSaaS

AUGUST 11, 2014

Trust trumps transactions. We really learned this lesson when we were trying to get our first customers for our outsourced sales service.

Outsourcing Services 52

Outsourcing Services Sales Outsourcing Sales 52