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Full Contact Entrepreneurship“In order to found something new, one has to leave the old and go on a quest of the seed idea, a germinal idea that will have the potential of bringing forth that new thing.” Joseph Campbell, Hero with a Thousand Faces
Andy [email protected]://blog.koalab.comhttp://www.linkedin.com/in/andypalmer
Today’s talk
● Who I am● Origin Story : Vertica● Start-up Advice ● Being a GREAT FOUNDER● CIC Rotterdam● Discussion
Who I am
● Grew up in a small family business in Chicago, IL
● Bowdoin College in ‘88; English, History, Computer Science
● Rugby in Australia/New Zealand/Fiji/France/Ireland/Boston
● Dartmouth College/Tuck ‘94; focus on Entrepreneurship and Technology
● Involved in 55+ Start-ups in the past 25 years
Teams I’ve helped build and roles I’ve played
Director of Marketing
VP Sales & Marketing( NASDAQ: PCOR )
VP Sales & Marketing(Sold to IBM)
SVP Operations and CIO( NASDAQ: INFI )
CEO & Co-Founder(Acquired by HP)
CEO & Co-Founder
2005 - 2016 1994 - 2005
Global Head of Software and Data Engineering
Founder$6M+ Seed Fund
Teams I’ve helped build and roles I’ve played
Acquired by
Acquired by
Acquired byAcquired by
Acquired by
Acquired by
Co-Investors @ Koa Labs include :
Joe Liemandt Founder & CEO, Trilogy
Scott Banister Founder, IronPort
Eric Schmidt Executive Chairman, Google
Mark Cuban Owner, Dallas Mavericks
Marc Benioff Founder & CEO, Salesforce
Lots of trial and error - 55+ start-ups
Why continue doing tech start-ups?Can you guess what is being loaded on this aircraft?
It is a hard disk drive for the IBM 305 RAMAC, the first IBM “Super Computer” released in September 1956.
This HDD weighed over a ton and stored an “astonishing” (at the time) 5 MB.
Hint: the picture was taken in 1956
Questions we asked at Vertica’s founding
● Does the world really need another DB Engine?
● What do we need to successfully build a significant new enterprise software company today? (Winter 2005)
● How can we create a functional culture where engineers and business people trust each other deeply?
● Could we have fun in the process?
The RDBMS market: $15B-16B ~10% CAGR Data warehousing represents ~⅓ of the overall
database market, but >60% of growth
2005 DB Revenue
Oracle $6.51B 44.6%
IBM $3.12B 21.4%
Microsoft $2.45B 16.8%
Sybase $0.42B 2.9%
Teradata $0.51B 3.5%
Other $1.58B 10.8%
Total 14.59BGartner and IDC, 2006
Discontinuous technological innovation
Winter2005
Column store can improve performance by up to 100x for data warehousing workloads
Cost of sales matters!!!!
Fast forward to fall 2010 <5 years later
1) In memory and columnar store used in next generation databases increase performance by 50-100x
Engineering Centric Culture and Respect for the Sales Learning Curve
The first six years
First Customer Ship 100th Customer
The first six yearsThoughtful customer acquisition and Intentional revenue management.
The first six yearsConstant, thoughtful capital efficiency for 5 years limits Common Shareholder Dilution
through the worst economic environment of the past 50 years
Series A$7M
+Highland+BVP
Series B1/2$13M/$3.5M
+NEA+Kleiner Perkins
Series C$5M
Insiders
VoltDB Spinoff$3M
SigmaKepha
The first six yearsCulture - How we operate at Vertica
● Believe that creating value for customers is the fundamental basis for creating value for shareholders
● Embrace and pursue diversity as a source of creativity and innovation
● Prize and recognize individual excellence and enable it in the context of overall team success
● View the failure to try as worse than the failure in trying
● Enable and reward the sharing of knowledge and view withholding it as socially unacceptable
● Check our titles and degrees at the door at the beginning of every discussion; view the correctness of an idea, not its originator, as the source its value; and at the end of the discussion, jointly own the best idea
● Consider and debate the ethical implications of our technical and business goals and practices before acting
<Six years after founding
Culture Matters: impact 9 years after founding
George KadifaEVP, HP Software
Tim CamposCIO, Facebook
Know your model: Blessed vs Bootstrapped
Internally Financed Externally Financed
Fast Growth Slow Growth
Youth Experience
Profit Motive Philanthropy
‘Customer’ Oriented ‘Tech’ Oriented
Central Control Decentralized
Strategy Centric Execution Centric
Trilogy Bowstreet Infinity TamrVertica
?
You’re not in Kansas anymore
“There is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in the introduction of a new order of things”
Niccolo Machiavelli, The Prince
Be aware of collateral damage
“Every act of creation is first of all an act of destruction”Pablo Picasso
Speed/Urgency Matters
http://techcrunch.com/2008/10/10/sequoia-capitals-56-slide-powerpoint-presentation-of-doom
Intentional Leadership Matters
● I work for the people that work with me.
● My most important job is to make the people that work with me successful while aligning their professional interests with “whatever it takes” to make the startup successful (and have FUN in the process).
● Professional development is primary driver.
● Reid Hoffman - “Alliances” and “Tours of Duty”
● Give people better professional development opportunities than they could get anywhere else.
Startup financing: it’s really simplePut away your spreadsheets and DCFs
Founding
Venture Capital (Series A, B…)
Private Equity
Public Markets
Self Fund
Most Expensive
Least Expensive
Least Satisfying
Most Satisfying
Financing Cost Emotional Result
Partnership matters: Why don’t we have that kind of relationship?
Start-up financing: traditional VC assumptionsGiven some $ amount of cash required to get through initial ‘buildout’
50% ownership40%- 60%++ -
Series A Valuation is a calculation based on:● $ you need● how much leverage you have● % ownership you are willing to give up
Traditional VC target is to end up with >20% of successful companyVC will put aside $M required to fund company through full cycle
Series A is small $ - so size doesn’t matter to them
Proactively avoid dysfunction of mismanaged expectations
Can you identify the founders who just mis-set expectations with their new investors?
What it means to be a “Founder”
● “Founder” ≠ CEO or any other functional role–can be combined
● Founder is a lot more fun IMHO
● Unconditional commitment & willingness to “do whatever it takes” to achieve vision
● Ability to suspend reality, believe in your vision and lead others to believe
● Passion & confidence to work through the darkest hours
● Willingness/Ability to be 100% mission-driven
Summary
● Don’t be naive : starting a new company is easy, starting a GREAT company is VERY hard
● If you want to start a great company :○ Know your model - be intentional on key dimensions of culture and style of company○ IQ Matters - hire only the best○ Speed/Urgency Matters - it’s your only real advantage○ Emotion and Judgement BOTH Matter○ Intentional Leadership Matters○ Partnership Matters○ Being a GREAT FOUNDER matters more than any title you will ever have
CIC Rotterdam ● CIC is the largest startup & entrepreneur-focused community in the world in Cambridge, MA● Recently expanded to Europe, chose Rotterdam (university city like Boston, next to Delft, etc.)● 50 Startups today, 150 Next Year, 500 in 3 years● Launched what has become the largest weekly startup gathering in Europe.
○ Recently reached 500 ppl attendance.● Has been open in stealth/beta/preview for about a year
○ Official grand opening Oct 13th, ○ Prince Constantijn in attendance.○ Expecting 1000 ppl at the party.
● This summer, hosted the amazing Syrian refugee-centric group Re/Start at CIC Netherlands. ○ Amazing energy and capabilities.
● * Observation : community/style there is really no different from what we see in Boston○ Bit less developed venture capital infrastructure
http://cicrotterdam.com/
www.tamr.com/cs.uwaterloo.ca/~ilyas/papers/StonebrakerCIDR2013.pdf
www.edx.org/course/startup-success-how-launch-technology-mitx-startx
[email protected]/great-reads-for-start-ups/www.linkedin.com/in/andypalmer
Discussion
