The Runaway Train of Late Stage Fundraising


This post is by Tomasz Tunguz from Tomasz Tunguz


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Every morning, it seems like a startup raises a massive growth round. In fact, the data proves the point. In 2014, there were 251 working days and 211 $40M+ growth rounds - just about one per day. In contrast to the frenetic private market, there were 15 US IT venture-backed IPOs with offerings greater than $40M last year, slightly more one IPO per month in 2014. Private market rounds were 14x as common as IPOs in 2014, compared to the 2004-2007 era, when IPOs were about as equally common as large private financings.

The Runaway Train of Late Stage Fundraising


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




Every morning, it seems like a startup raises a massive growth round. In fact, the data proves the point. In 2014, there were 251 working days and 211 $40M+ growth rounds - just about one per day. In contrast to the frenetic private market, there were 15 US IT venture-backed IPOs with offerings greater than $40M last year, slightly more one IPO per month in 2014. Private market rounds were 14x as common as IPOs in 2014, compared to the 2004-2007 era, when IPOs were about as equally common as large private financings. As Bill Gurley wrote, “These large, high-priced private financings are the defining characteristic of this particular technology cycle.” In the past, companies went public to raise large amounts of capital, because the IPO markets were the only place to do it. Going public meant a lot of internal work preparing for regulatory scrutiny, but a substantial
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3 Key Ingredients of a Sales Compensation Plan


This post is by Tomasz Tunguz from Tomasz Tunguz


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Like most things in a startup, a sales commission plan should evolve as the company scales. For example, as Mark Roberge, CRO of Hubspot, wrote in The Sales Acceleration Formula, Hubspot adopted three different sales compensation plans throughout its early evolution which embody the three key ingredients of a sales compensation plan. Hubspot’s first sales plan paid $2 of commission for every $1 of MRR an account executive booked. When the company decided to focus on revenue retention, the sales team adopted a new sales model.

3 Key Ingredients of a Sales Compensation Plan


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




Like most things in a startup, a sales commission plan should evolve as the company scales. For example, as Mark Roberge, CRO of Hubspot, wrote in The Sales Acceleration Formula, Hubspot adopted three different sales compensation plans throughout its early evolution which embody the three key ingredients of a sales compensation plan. Hubspot’s first sales plan paid $2 of commission for every $1 of MRR an account executive booked. When the company decided to focus on revenue retention, the sales team adopted a new sales model. Account executives were divided into quartiles by customer retention. The top quartile received $4 of commission for $1 of MRR; the next quartile received $3, and so on. Hubspot’s third sales model paid $2 for every $1 of MRR, but not immediately. 50% of the commission was paid in the first month, 25% in the sixth month, 25% in the twelfth month - Continue reading "3 Key Ingredients of a Sales Compensation Plan"

The 5 Key People in a SaaS Sales Process


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Whether implicitly or explicitly, it’s critical for a startup to map out accounts to understand the purchasing dynamics of a buyer. When sales teams start selling, their goal should be to create the sales playbook. The playbook all begins with understanding the key dynamics among the five players in the sales process. These are the five people: The Proponent of the Sale champions the sales. The Salesperson must equip this champion with all the tools to convince the other stakeholders to pursue the transaction.

The 5 Key People in a SaaS Sales Process


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




Whether implicitly or explicitly, it’s critical for a startup to map out accounts to understand the purchasing dynamics of a buyer. When sales teams start selling, their goal should be to create the sales playbook. The playbook all begins with understanding the key dynamics among the five players in the sales process. These are the five people: The Proponent of the Sale champions the sales. The Salesperson must equip this champion with all the tools to convince the other stakeholders to pursue the transaction. The Opponent of the Sale objects to the transaction. Opponents of the Sale exist in almost every software sale. Many different reasons fuel opposition to a sale. A head of engineering may prefer to build a technology in house. A head of finance may disagree with the financial benefits. A team lead may suffer decreased staff, decline in power or reduced importance reduced as a consequence Continue reading "The 5 Key People in a SaaS Sales Process"

The Best Book on Building a SaaS Sales Team


This post is by Tomasz Tunguz from Tomasz Tunguz


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If you want to understand how to build a great SaaS sales organization, you should read Mark Roberge’s The Sales Acceleration Formula. It’s the single best book on the topic. Mark is the Chief Revenue Office at Hubspot, a company which has created tremendous success by perfecting the inbound marketing plus sales model. The book is invaluable for every founder, CEO and member of the management team because it not only explains how the Hubspot sales team is structured, but why the structure came to be.

The Best Book on Building a SaaS Sales Team


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




If you want to understand how to build a great SaaS sales organization, you should read Mark Roberge’s The Sales Acceleration Formula. It’s the single best book on the topic. Mark is the Chief Revenue Office at Hubspot, a company which has created tremendous success by perfecting the inbound marketing plus sales model. The book is invaluable for every founder, CEO and member of the management team because it not only explains how the Hubspot sales team is structured, but why the structure came to be. The first employee at Hubspot and tasked with building the sales team, Mark developed a structured interview to qualify candidates and correlated the attributes of the best sales candidates. His list surprised me. Preparation, Adaptability, Domain Experience, Intelligence and Passion are the five characteristics of people most likely to succeed in Hubspot’s sales teams. With this knowledge in hand, Mark created a quantitative candidate
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The SaaS Company that Grew from 0 to 4M Subscribers in 2.5 Years


This post is by Tomasz Tunguz from Tomasz Tunguz


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In 2.5 years, Adobe has transformed its business from a software license business into a SaaS business. It’s been a remarkable transition, and one not talked about very much in the SaaS world. Transitions from licensed software to SaaS are rare. The travel and expense management behemoth, Concur, recently acquired by SAP for $8.3B, is another great example that made the transition first from CD-ROM packaged software, then to enterprise license software and then to SaaS.

The SaaS Company that Grew from 0 to 4M Subscribers in 2.5 Years


This post is by Tomasz Tunguz from Tomasz Tunguz


Click here to view on the original site: Original Post




In 2.5 years, Adobe has transformed its business from a software license business into a SaaS business. It’s been a remarkable transition, and one not talked about very much in the SaaS world. Transitions from licensed software to SaaS are rare. The travel and expense management behemoth, Concur, recently acquired by SAP for $8.3B, is another great example that made the transition first from CD-ROM packaged software, then to enterprise license software and then to SaaS. Above, the line chart shows the astounding growth in the number of Adobe Creative Suite subscribers from the launch of CreativeSuite 6 in mid-2012 through March 2014 growing at 31% per quarter to 3.97M in their last quarter. Generating about $4B annually, Adobe is worth $38B and employs more than 12,500 people. And in 2012, the company decided to disrupt its own businesses. The licensed software business, a cash cow,
Continue reading "The SaaS Company that Grew from 0 to 4M Subscribers in 2.5 Years"