Sequoia Capital: Jim Goetz at Y Combinator's Startup School At Stanford

Humble Beginnings

© 2011 Sequoia Capital

V I T A L S I G N S A Little Personal History

2

THINGS © Play Bigger Advisors

FOUNDERS

IDEA

TIMING

© 2011 Sequoia Capital

N O W

4

© 2011 Sequoia Capital

T H E N

5

© 2011 Sequoia Capital

N O W

L A R R Y

P A G E

6

© 2011 Sequoia Capital

T H E N

1 9 9 8

L A R R Y P A G E

S E R G E Y B R I N

7

1999 2004 TODAY

Series A IPO Market Cap

$7.5M $27B $194B

© 2011 Sequoia Capital

N O W

J O H N

C H A M B E R S

8

© 2011 Sequoia Capital

T H E N

1 9 8 7

9

1987 1990 TODAY

Series A IPO Market Cap

$1.9M $224M $95B

S A N D Y L E R N E R

L E N B O S A C K

© 2011 Sequoia Capital

N O W

J E F F

W E I N E R

10

© 2011 Sequoia Capital

T H E N

2 0 0 3

R E I D H O F F M A N

11

2003 2011 TODAY

Series A IPO Market Cap

$4M $4B $9B

© 2011 Sequoia Capital

N O W

O M A R

H A M O U I

12

© 2011 Sequoia Capital

T H E N

2 0 0 6

O M A R H A M O U I

13

2006 2010

Series A Acquired

$3.3M $750M

© 2011 Sequoia Capital 14

PROPS TO PAUL, JESSICA & TEAM

P A U L

G R A H A M

J E S S I C A

L I V I N G S T O N

© 2011 Sequoia Capital

T H E

F O U N D E R S

C O D E TM

Iterate Failures F

ocu

sed

In

sig

ht

Long-term

Underdogs Unconventional

Relentless

Agility

Rebels

Misfits

15

THEY WERE ONCE IN YOUR SHOES

16 © 2011 Sequoia Capital

Idea

© 2011 Sequoia Capital

U N I Q U E & C O M P E L L I N G

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© 2011 Sequoia Capital

Obvious

Lots of competitors

Easy to build

50% improvement

Too Early

Unique or novel

Handful of niche players

“Turing” award

10X better

First Mover

C R E A T I V E

T E N S I O N S

Timing

© 2011 Sequoia Capital

1973 1975 1977 1979 1981 1983 1985 1987

ATARI TANDEM APPLE AMCC LINEAR TECH

LSI LOGIC

3COM

ORACLE

SYMANTEC

EA

CISCO

S&P DECLINE 1973 – 74 43% 1980 – 82 17% 1987 30%

FLEXTRONCIS

NVIDIA

INS

2000-02 44% 1998 15%

1989 1991 1993 1995 1997 1999

1990 15%

GOOGLE

RACKSPACE

YAHOO!

NETAPP

REDBACK PAYPAL

NETSCREEN MICROCHIP ARBOR

DOCUMENTUM

ARUBA

ISILON

LINKED-IN

YOUTUBE

PALO ALTO

KAYAK

UNITY

POCKETGEMS

BUMP

AIRBNB

SQUARE

TUMBLR

MONGO

2001 2003 2005 2007 2009 2011

GREENDOT SOURCEFIRE

ZAPPOS

ADMOB

FIREYE

DROPBOX

JIVE

2007 – 08 16%

UPS AND DOWNS

21

© 2011 Sequoia Capital

marketplace

App Store

2000 2011

$ S

TA

RT

UP

CO

ST

S

INTERNET/MOBILE START-UP COSTS

DROPPED 90%

22

© 2011 Sequoia Capital

MOBILE OUTPACES PC, INTERNET RAMP

23

1994

100M

users

1998

100M

users

2007

iPhone

1996

AOL flat-

rate

pricing

PCs

~7 years

from 10

to 100M

Internet

~5 years

from 10

to 100M

Mobile

Internet

<4 years

from 10

to 100M

2005

1B

users

2005

800M

users

1980 1990 2000 2010

2005

10M

users

1987

10M

users

1993

10M

users

1990

HTTP, web

browser

invented

1976-78

Apple, Microsoft

founded

2002

First RIM

Blackberry

launched

© 2011 Sequoia Capital

POST-PC RAMP TO 10 BILLION

24

© 2011 Sequoia Capital

THE WEB GRAVITATED TOWARDS

FREE + AD SUPPORTED

Paym

en

t U

pfr

on

t

Payment Ongoing

Free

Contract

Paid

None

Advertising Lead-gen

Training & Support

Premium Subscription

In App Content

Transaction Based

SaaS

Web

2000s

25

© 2011 Sequoia Capital

NEW AND DIVERSE MODELS ARE BEING EXPERIMENTED

WITH IN THE MOBILE ECONOMY TODAY

Paym

en

t U

pfr

on

t

Payment Ongoing

Free

Contract

Paid

None

Advertising Lead-gen

Training & Support

Premium Subscription

In App Content

Transaction Based

26

…Great Causes

© 2011 Sequoia Capital

Top VC Firms Benefit From Wave of IPOs

Silicon Valley's technology boom is giving a lift to the venture-capital

industry. But many of the gains are being disproportionately reaped by

brand-name venture firms, which are benefiting from a wave of Internet IPOs

and the soaring valuations of closely held companies….

N O T T H E R E A L S T O R Y

T H E R E A L S T O R Y

MacArthur Foundation

International Justice

© 2011 Sequoia Capital

T H E R E A L S T O R Y

Rockefeller Foundation

Community Safety and Survival

© 2011 Sequoia Capital

Sloan Kettering

Cancer Research and Treatment

T H E R E A L S T O R Y

© 2011 Sequoia Capital

T H E R E A L S T O R Y

Moore Foundation

Ecosystem Conservation

© 2011 Sequoia Capital

T H E R E A L S T O R Y

Wellcome Trust

Biomedical Research

© 2011 Sequoia Capital

T H E R E A L S T O R Y

MIT

Student Scholarships

© 2011 Sequoia Capital

© 2011 Sequoia Capital

Alfred I Dupont Trust

Amherst College

Barr Foundation

Boston College

Boston University

Bowdoin College

Brown University

Bush Foundation

Claremont McKenna

Colby College

Columbia University

Cornell University

Dartmouth College

Duke University

Georgia Tech Foundation

Harvard University

Hewlett Foundation

James Irvine Foundation

Johns Hopkins University

Macarthur Foundation

Moore Foundation

MIT

Northwestern University

Norwich University

Princeton University

Rensselaer

Rw Johnson Foundation

Rockefeller Foundation

Smithsonian Institution

Stanford University

The Ford Foundation

University Of Chicago

University Of Minnesota

University Of Notre Dame

University Of Rochester

USC

Vanderbilt University

Washington University

Wellcome Trust

Wellesley College

Williams College

G R E A T C A U S E S

35

Q & A

goetz@sequoiacap.com

THEY WERE ONCE IN YOUR SHOES

37 © 2011 Sequoia Capital

© 2011 Sequoia Capital

J O I N U S

38

Jim Goetz (goetz@sequoiacap.com)

Thank You