Military Strategy Applied to Startups


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




OODA was a technique coined by John Boyd, one of the leading military thinkers of the last 100 years, based on the German’s Blitzkrieg-style warfare which prioritized speed and surprise over the traditional win, hold and grind attrition techniques of trench warfare. After @pmarca tweeted about the concept, I read one of the books on the topic called Certain to Win. Boyd’s thesis is that leaders of successful teams have to enable their organization to move rapidly, which means empowering people at all levels to make decisions.

Military Strategy Applied to Startups


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




OODA was a technique coined by John Boyd, one of the leading military thinkers of the last 100 years, based on the German’s Blitzkrieg-style warfare which prioritized speed and surprise over the traditional win, hold and grind attrition techniques of trench warfare. After @pmarca tweeted about the concept, I read one of the books on the topic called Certain to Win. Boyd’s thesis is that leaders of successful teams have to enable their organization to move rapidly, which means empowering people at all levels to make decisions. Speed is a huge asset in confrontations in both business and war, particularly when there is a substantial size difference between two competitors, so the author writes. According to Boyd’s philosophy, the way to enable teams to become agile is by using two frameworks each with four ideas, the Organizational Climate and OODA. For teams to act swiftly, Boyd reasons, they must share Continue reading "Military Strategy Applied to Startups"

The Technology that’s Taking Data Science by Storm


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




Given all the momentum of the NoSQL movement, it would be easy to write off SQL-based technologies as forgotten, or simply standing still. But there’s a tremendous amount of innovation occurring in SQL databases. Amazon’s Redshift, an elastic data-warehousing solution launched in late 2012 is the most salient example. Redshift’s ability to process huge volumes of data is breathtaking. When running Redshift on solid state drives (SSDs), one team at FlyData queried 1 terabyte of data in less than 10 seconds.

The Technology that’s Taking Data Science by Storm


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




Given all the momentum of the NoSQL movement, it would be easy to write off SQL-based technologies as forgotten, or simply standing still. But there’s a tremendous amount of innovation occurring in SQL databases. Amazon’s Redshift, an elastic data-warehousing solution launched in late 2012 is the most salient example. Redshift’s ability to process huge volumes of data is breathtaking. When running Redshift on solid state drives (SSDs), one team at FlyData queried 1 terabyte of data in less than 10 seconds. AirBnB’s data science team wrote about their experiences contrasting Redshift and Hive. They found Redshift to be 20x faster at 25% the cost. Aggregate Knowledge shared their story of searching for a database system that permits linear scaling and quick access to same day data with Redshift Although Redshift adoption is still much smaller than other data-warehousing technologies, consider Github has 96 Redshift repositories compared to close to 1200 Continue reading "The Technology that’s Taking Data Science by Storm"

The Maximum Viable Churn Rate for a Startup


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




​ An entrepreneur asked me the question, what is the maximum viable churn for a startup? Within that question, a few others are embedded. How should a founder think about trading off efforts to grow revenue and mitigate churn? What is the impact of account growth on net churn? Startups must walk a tight-rope to balance growth, churn and cash. Below is the framework I use for working through maximum viable churn.

The Maximum Viable Churn Rate for a Startup


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post





An entrepreneur asked me the question, what is the maximum viable churn for a startup? Within that question, a few others are embedded. How should a founder think about trading off efforts to grow revenue and mitigate churn? What is the impact of account growth on net churn? Startups must walk a tight-rope to balance growth, churn and cash. Below is the framework I use for working through maximum viable churn. ​
Startups with higher churn chew through more capital to maintain the same growth rate. Let’s compare four scenarios of a SaaS company with $1000 annual customer revenue, a 0.8 sales efficiency metric, implied cost-of-customer-acquisition of $1250 and 3,000 customers generating $3M in annual revenue. ​
Monthly Churn2%3%4%5%
Annual Churn22%31%39 %46%
Churned Customers64691811621379
CAC Spend to Recoup in $M0.81.21.5 Continue reading "The Maximum Viable Churn Rate for a Startup"

The Best Times of Year to Raise Capital for Your Startup


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




Aside from a startup’s internal considerations about the right time to raise money, founders should weigh the seasonality of the fund raising market when planning their raise. There’s a rule of thumb batted around the valley that the worst times to raise capital are in the dog-days of summer and after Thanksgiving. As it turns out, this aphorism is only a half-truth. Below is a chart of the dollars VCs have invested by month of year.

The Best Times of Year to Raise Capital for Your Startup


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




Aside from a startup’s internal considerations about the right time to raise money, founders should weigh the seasonality of the fund raising market when planning their raise. There’s a rule of thumb batted around the valley that the worst times to raise capital are in the dog-days of summer and after Thanksgiving. As it turns out, this aphorism is only a half-truth. Below is a chart of the dollars VCs have invested by month of year. I’m using Crunchbase data since 2005 for tech companies in the US. There are a few notable trends in the data. First, the impact of the summer is evident. The slowest months for fundraising are January-March and September. I’d estimate there are a few weeks latency in the data between when the investment commitment is made and the investment is disclosed. The legal diligence process of about 3-4 weeks that typically follows signing a
Continue reading "The Best Times of Year to Raise Capital for Your Startup"

The Go-To-Market Challenges of B2D Companies


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




Last week, I spent some time at HeavyBit, the community for developer focused companies in SoMa, chatting with a few companies reaching scale. Across a handful of meetings, a recurring theme surfaced for these B2D (business-to-developer companies). How should their sales and marketing apparatuses be built? Do the field sales models of infrastructure companies or the inside sales models of software companies apply when the initial user is a developer?

The Go-To-Market Challenges of B2D Companies


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




Last week, I spent some time at HeavyBit, the community for developer focused companies in SoMa, chatting with a few companies reaching scale. Across a handful of meetings, a recurring theme surfaced for these B2D (business-to-developer companies). How should their sales and marketing apparatuses be built? Do the field sales models of infrastructure companies or the inside sales models of software companies apply when the initial user is a developer? B2D companies are a special breed. They often begin as very small development projects, sometimes open-source, with a kernel of developers building a product to service their own needs, which gains some momentum and begins to grow. In this sense, B2D companies are similar to pure consumer companies. The product’s initial traction derives from word-of-mouth marketing, whether through forums, news sites, conferences github or Apache project pages. Sometimes, the momentum around a B2D product engendered by its community becomes Continue reading "The Go-To-Market Challenges of B2D Companies"