The Stability of the Current Tech Market


This post is by Tomasz Tunguz from Tomasz Tunguz


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It’s Q3 earnings season and about half of the major public tech companies and recent startup IPOs have reported their figures. I keep track of earnings to get a sense for how these companies perceive their markets. Meeting or exceeding earnings indicates companies can forecast their growth and demonstrates how predictable these businesses are. The more predictable, the more stable the business environment and consequently, the fund raising environment for startups.

The Stability of the Current Tech Market


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




It’s Q3 earnings season and about half of the major public tech companies and recent startup IPOs have reported their figures. I keep track of earnings to get a sense for how these companies perceive their markets. Meeting or exceeding earnings indicates companies can forecast their growth and demonstrates how predictable these businesses are. The more predictable, the more stable the business environment and consequently, the fund raising environment for startups. The chart above shows the revenue surprise figures for the companies who have reported earnings so far. Revenue surprise is the percent difference of actual revenue per share figures compared to the estimated ones prepared by analysts. 69% of these tech publics exceeded forecasts in Q3 which compares to 60% in Q2. Similar to last quarter, consumer companies constitute the majority of the revenue misses: Amazon, Angie’s List, eBay, GreenDot, Google, Trulia, Xoom. In fact, the median consumer company
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One of the Best Business Opportunities in the Next Decade


This post is by Tomasz Tunguz from Tomasz Tunguz


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The real promise of the Internet of Things isn’t simply linking millions of devices together, just like the real innovation of the web wasn’t networking a bunch of computers. Instead, the true and still unrealized potential of IoT is to transform business models; it’s enabling companies to sell products in entirely new and better ways that benefit both the company and the customer. Around the turn of the millennium, startups began using the web browser to deliver their products to consumers and companies.

One of the Best Business Opportunities in the Next Decade


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




The real promise of the Internet of Things isn’t simply linking millions of devices together, just like the real innovation of the web wasn’t networking a bunch of computers. Instead, the true and still unrealized potential of IoT is to transform business models; it’s enabling companies to sell products in entirely new and better ways that benefit both the company and the customer. Around the turn of the millennium, startups began using the web browser to deliver their products to consumers and companies. Soon afterwards, instead of paying a one-time fixed price to use the software, customers subscribed to access the software. You can’t buy Quicken or Quickbooks on a CD for one fixed payment anymore. Now it’s a subscription. Though the difference may seem slight, this evolution of business model has several immense and crucial advantages that apply both to Internet businesses and the Internet of Things. First, companies Continue reading "One of the Best Business Opportunities in the Next Decade"

Four Important Data Points on Measuring Your Startup’s Customer Happiness


This post is by Tomasz Tunguz from Tomasz Tunguz


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At some point, most startups will begin to measure their customers’ happiness. Customer satisfaction is an important predictor of loyalty and can foster fantastically efficient word-of-mouth growth. Many companies employ Net Promoter Score to quantify customer satisfaction. NPS measures the fraction of a customer base which are promoters and detractors of a company’s product. I’ve been told that NPS scores greater than 50 are impressive, but this is simply a rule of thumb.

Four Important Data Points on Measuring Your Startup’s Customer Happiness


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




At some point, most startups will begin to measure their customers’ happiness. Customer satisfaction is an important predictor of loyalty and can foster fantastically efficient word-of-mouth growth. Many companies employ Net Promoter Score to quantify customer satisfaction. NPS measures the fraction of a customer base which are promoters and detractors of a company’s product. I’ve been told that NPS scores greater than 50 are impressive, but this is simply a rule of thumb. So what’s the right way to evaluate a company’s NPS report? Zendesk recently published NPS benchmarks that are quite useful to interpret NPS scores. These are the four most interesting data points I found in the report: Median NPS Score by Type of Company
B2C32
B2B29
Internal49
First, the mean NPS across the 230 companies is 29. But this average varies across customer types. The table above shows B2B customers are less satisfied and
Continue reading "Four Important Data Points on Measuring Your Startup’s Customer Happiness"

The Impact of Investor Geography on Your Seed, Series A and B Check Size


This post is by Tomasz Tunguz from Tomasz Tunguz


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When we analyzed the impact of location on a startup’s ability to raise capital, we found no statistically significant difference. Startups in San Francisco, Seattle, Pittsburgh, Austin and many other cities all demonstrated similar ability to raise follow-on rounds. But is the same true for investors of various locations? Do investors across the US invest similarly across Seed, Series A and Series B? They do not. In fact, there is a statistically significant difference in investment patterns of investors depending on their location.

The Impact of Investor Geography on Your Seed, Series A and B Check Size


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




When we analyzed the impact of location on a startup’s ability to raise capital, we found no statistically significant difference. Startups in San Francisco, Seattle, Pittsburgh, Austin and many other cities all demonstrated similar ability to raise follow-on rounds. But is the same true for investors of various locations? Do investors across the US invest similarly across Seed, Series A and Series B? They do not. In fact, there is a statistically significant difference in investment patterns of investors depending on their location. The table below contrasts the mean round sizes across Seed, Series A and Series B, by investor headquarters location across firms in California, Massachusetts and New York1.
Round Sizes in $MCAMANY
Seed1.11.11.1
Series A5.86.15.0
Series B13.311.312.8
Lowest Statistically Different Values Marked in Red
Investors in
Continue reading "The Impact of Investor Geography on Your Seed, Series A and B Check Size"

Using Statements of Work to Accelerate Sales Cycle and Align Sales, Customer Success and Marketing


This post is by Tomasz Tunguz from Tomasz Tunguz


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I met a really smart vice president of sales a few weeks ago working in a company with mid-market customer values in the $10-100k per year range. When I asked her about her sales process, she described how her team employs statements of work (SOW), which isn’t something I hear about very frequently in startups, despite the fact they are very powerful sales tools. Statements of work describe the proposed working relationship between a vendor and customer.

Using Statements of Work to Accelerate Sales Cycle and Align Sales, Customer Success and Marketing


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




I met a really smart vice president of sales a few weeks ago working in a company with mid-market customer values in the $10-100k per year range. When I asked her about her sales process, she described how her team employs statements of work (SOW), which isn’t something I hear about very frequently in startups, despite the fact they are very powerful sales tools. Statements of work describe the proposed working relationship between a vendor and customer. These are common in government contracts and in the advertising agency world where they are called creative briefs, among other places. But I don’t run across them very often in SaaS. In this company’s case, the sales team uses statements of work during the middle part of the sales process (after qualification before contract) to accomplish three goals. First, to clarify the needs of the customer and set the customer’s expectations of what Continue reading "Using Statements of Work to Accelerate Sales Cycle and Align Sales, Customer Success and Marketing"