A six-step framework to make strategic decisions


This post is by Tomasz Tunguz from Tomasz Tunguz


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Any number of challenges can arise during a startup’s initial years. Some of these changes could be major and may require rethinking strategy. Competitors enter your target market. New products are released into your market which undercut yours. Customer acquisition costs rise dramatically. If faced with these questions, it’s hard to know where to begin or how to structure an analysis to reach an answer. McKinsey uses a 6 step process to frame the process of answering these strategic questions which is profiled in this month’s Harvard Business Review.

A six-step framework to make strategic decisions


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




Any number of challenges can arise during a startup’s initial years. Some of these changes could be major and may require rethinking strategy. Competitors enter your target market. New products are released into your market which undercut yours. Customer acquisition costs rise dramatically. If faced with these questions, it’s hard to know where to begin or how to structure an analysis to reach an answer. McKinsey uses a 6 step process to frame the process of answering these strategic questions which is profiled in this month’s Harvard Business Review. This framework has helped me many times simplify strategic questions and shift from questioning to analysis to action. Case: A new competitor emerges to compete with a startup
  1. Frame the strategic choices as mutually exclusive options. Start with the most apparent options. Either compete directly with a new competitor or change your target market.
  2. Generate alternatives. Brainstorm other possibilities that broaden Continue reading "A six-step framework to make strategic decisions"

Should founders join incubators?


This post is by Tomasz Tunguz from Tomasz Tunguz


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Yesterday, I spoke at Columbia Business School. We had a conversation about the role of incubators and accelerators (or the moniker of your choice) within the startup ecosystem. Given the volume of first time entrepreneurs and the broad growth of interest in entrepreneurship, I think these programs are invaluable. To entrepreneurs, these programs offer up to seven value propositions, listed in order of importance, as I see it. Education - Examples include General Assembly runs a substantial education program and YCombinator operates Startup School and First Growth’s Venture Network Startup-in-a-box - TechStars offers legal help to incorporate a company, PR and marketing support for launch, banking partners, business development contacts, developer tools discounts all with the goal of eliminating as much friction as possible and helping founders focus on product/market fit discovery and execution.

Should founders join incubators?


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




Yesterday, I spoke at Columbia Business School. We had a conversation about the role of incubators and accelerators (or the moniker of your choice) within the startup ecosystem. Given the volume of first time entrepreneurs and the broad growth of interest in entrepreneurship, I think these programs are invaluable. To entrepreneurs, these programs offer up to seven value propositions, listed in order of importance, as I see it.
  1. Education - Examples include General Assembly runs a substantial education program and YCombinator operates Startup School and First Growth’s Venture Network
  2. Startup-in-a-box - TechStars offers legal help to incorporate a company, PR and marketing support for launch, banking partners, business development contacts, developer tools discounts all with the goal of eliminating as much friction as possible and helping founders focus on product/market fit discovery and execution.
  3. Networking - Within each program, founders develop relationships with like-minded entrepreneurs and most programs offer guest Continue reading "Should founders join incubators?"

The startup love affair


This post is by Tomasz Tunguz from Tomasz Tunguz


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Every investment requires a leap of faith, an emotional act that’s not pure reason, and that’s got to carry you through in the inevitable many months, sometimes years, of horrific bad stuff that comes with the company. And you’ve got to have that energy, that sustaining belief to carry you through, because if you don’t, then you regret having done it. So when I have regret, it’s when I didn’t have that, and I’d logically talked myself into [the investment] and checked the boxes.

The startup love affair


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




Every investment requires a leap of faith, an emotional act that’s not pure reason, and that’s got to carry you through in the inevitable many months, sometimes years, of horrific bad stuff that comes with the company. And you’ve got to have that energy, that sustaining belief to carry you through, because if you don’t, then you regret having done it. So when I have regret, it’s when I didn’t have that, and I’d logically talked myself into [the investment] and checked the boxes. So it was really helpful [to have a failed investment] that taught me, ‘don’t invest like that.’ You have to have the love affair, and if you don’t, then you shouldn’t do it.

Peter Fenton said this in a Stanford Business School case I happened to read over the weekend. The sentiment resonates deeply with me. Every investment is an emotional commitment to support and Continue reading "The startup love affair"

The Heyday of SaaS – quick observations from Dreamforce


This post is by Tomasz Tunguz from Tomasz Tunguz


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We are in the heyday of SaaS. The conference spanned 20+ buildings, served 60,000+ attendees and was sponsored by more than 300 vendors. Free food everywhere. Skullcandy wireless headphone giveaways. DJs in every corner. Four square play areas on fake grass outside. It is one huge party. Benioff delivered a tremendous keynote. I wish I could speak in public with his confidence, control and passion. Dreamforce created the perception that Salesforce is at the center of a huge ecosystem of their own creation, which inspires confidence in customers and partners.

The Heyday of SaaS – quick observations from Dreamforce


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




  1. We are in the heyday of SaaS. The conference spanned 20+ buildings, served 60,000+ attendees and was sponsored by more than 300 vendors. Free food everywhere. Skullcandy wireless headphone giveaways. DJs in every corner. Four square play areas on fake grass outside. It is one huge party.
  2. Benioff delivered a tremendous keynote. I wish I could speak in public with his confidence, control and passion.
  3. Dreamforce created the perception that Salesforce is at the center of a huge ecosystem of their own creation, which inspires confidence in customers and partners.
  4. Social is the buzzword. After the BuddyMedia and Radian6 acquisitions, this is no surprise.
  5. Salesforce manages a torrent of brands: Chatter, ChatterBox, Do, Desk, Data.com, Heroku, Social Cloud, Marketing Cloud, Sales Cloud, Services Cloud, etc. It’s confusing to customers but indicative of their ambition.
  6. At some point, startups will need to evaluate platform risk, asking hard questions like which Continue reading "The Heyday of SaaS – quick observations from Dreamforce"

A startup’s transition from product development to growth


This post is by Tomasz Tunguz from Tomasz Tunguz


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At a recent meeting, David Barrett, one of the founders of Expensify, drew this diagram when explaining his company’s structure. He has overlaid the core teams of a company with a conversion funnel. It’s brilliantly simple. As every SaaS startup transitions from development to growth, the company must supplement the engineering and product capability with sales, marketing and account management. This diagram is the simplest way to show how they work together harmoniously at a strategic level.

A startup’s transition from product development to growth


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




At a recent meeting, David Barrett, one of the founders of Expensify, drew this diagram when explaining his company’s structure. He has overlaid the core teams of a company with a conversion funnel. It’s brilliantly simple. Screen Shot 2012-09-20 at 7.08.30 AM.png As every SaaS startup transitions from development to growth, the company must supplement the engineering and product capability with sales, marketing and account management. This diagram is the simplest way to show how they work together harmoniously at a strategic level. Marketing builds a prospect pipeline. Product and engineering qualify and activate the prospects into leads for the sales team to close as paying customers. And account management retains customers with great service. From this diagram, the measures of tactical success are plain to see. How quickly is marketing growing the prospect funnel? How well is product converting prospects to qualified leads? At what rate and at what contract value can sales close customers? Continue reading "A startup’s transition from product development to growth"