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Cor Winkler Prins - Founder & CEO, 4me Cor’s professional goal is to help the Enterprise Service Management (ESM) industry reach its next maturity level by providing easy-to-use functionality for the support of SIAM (Service Integration and Management). In 2010, he co-founded 4me to make it easy for all support domains (IT, HR, Facilities, etc.) within large enterprises to work seamlessly with each other, as well as with their managed service providers (MSPs). In 2003, he helped the ITSM industry establish a new benchmark: the 30-day IT Service Management implementation. By using the predefined processes and detailed work instructions of the Alignability Process Model, and combining that with role-specific training material, a pre-configured ITSM application, and a standardized implementation methodology, it became possible to implement six processes within 30 workdays. In 1999, Cor helped the IT Service Management industry move away from highly customized implementations based on different interpretations of the ITIL best practices by developing the Alignability Process Model (APM). This was the first comprehensive set of integrated IT Service Management processes that include detailed work instructions for IT professionals. The APM has subsequently formed the basis of all other ITIL-based process models, such as BMC Software’s Service Management Process Model and HP’s Service Management Reference Model. What exactly is your startup bringing to the marketplace? We provide an enterprise service management tool, which essentially is a self-help portal for enterprise employees. When they get stuck or they don’t know what to do, and they need help from the Human Resources (HR) departments, or the Legal Department, or from IT, they can submit a request using that self-help portal, or use the app on their smartphone. We route that to the party that should provide that kind of assistance — and that can be an internal department, like the HR department or the IT department, or an external company, to which the enterprise has outsourced a service. For example, this might be the payroll service or the legal service. If all contracts are reviewed by an external legal firm, and that firm also uses 4me, they would link up their 4me environment with the environment of their enterprise customers. When that legal department or somebody coordinating the legal activities of the company wants to pass a request from one of the employees to get a contract reviewed, for example, then they just shoot it off to that external firm using our tool. In the background, we keep track of all the agreements that the enterprise has with the different service providers that employees in the core business rely on. What was the motivation in creating this company? In Silicon Valley today, there are a ton of Enterprise SaaS applications being created. Within an enterprise, the employees of the marketing department, for example, go to trade shows and they see something like MailChimp that they like and want to use. They come back and they talk to the IT Department, and then the IT Department says “I don’t know, it’s a cloud solution, we’re not familiar with the cloud, and we don’t have anyone to set it up for you.” If the marketing department is persistent enough, then the IT department will hire a consulting firm that has experience with MailChimp and will ask them to set it up. They’ll do a quick security check before purchasing to make sure it meets the necessary requirements. Then, this external firm will set up the MailChimp environment and integrate it, maybe with Salesforce, or with the corporate website, which might run on WordPress. Once it’s running, everything is fine, but then the marketing department wants to do a particular campaign, and for that, they will want to create something special on the corporate website. That needs to be integrated with MailChimp again, so they need to call back the consultants. Or they might discover a bug, or they want to upgrade, but basically every time the marketing department wants to do something special, they need to rely on these consultants. Over time, these consulting firms that specialize around certain technologies like MailChimp or WordPress or Salesforce — they keep getting repeat business from the enterprise. But, as people within the enterprise run into issues with the service, or they have questions or requests, they’ll send requests to the IT department, but they don’t have any expertise in how to configure or reconfigure these Enterprise SaaS applications. What they do instead is, over time they establish such a tight relationship with all these different consulting firms that they use for these different technologies that they start to demand service level agreements. This is really good for the external firms, because it means recurring revenue — very steady and reliable. What the enterprise then wants is to have an easy means of collaborating with external firms, and tracking the quality of service that they’re getting from each of their external providers. That is basically what is lacking in the enterprise service management space, a tool that can link enterprise customers to all the different parties that provide services to them. Then, the companies don’t have to retype every request that they get from their employees into a different service management tool for one of their external providers. They get accurate reporting on the quality of service that they’re getting, and the providers get the same information about the quality of service that they are delivering to their customers. So, when there are issues, they know that there is an issue, that the data hasn’t been manipulated by either the customer or the provider, and that the data is reliable. This lets them simply concentrate on making sure that the issue does not recur. What do you think is the most challenging matter that your company is facing right now? In the enterprise space, there are a couple of things that you really need to have sorted out well. The first thing is security. That extends immediately to privacy, particularly if you’re doing business globally like we are. You have to take very strict privacy regulations into account, particularly in Europe where the GDPR came about last year. That has a huge impact on providers like us. We need to make it easy for our customers, who store, for example, HR data — which is very sensitive. We need to allow these large organizations to prove to auditors that they are doing everything that can reasonably be expected to keep their employees’ data secure. When something bad happens, they need to know how to respond, and how to coordinate that, and they can use a tool like ours for that. Most of our customers in Europe do so. But, there are additional things that our tool needs to be capable of, because of the GDPR. For example, in our tool, a lot of focus has been put on being able to audit what has happened in the past. The GDPR on the one hand demands exactly that, but on the other hand, if an employee, for example, demands from the company that the data is erased, which is “the right to be forgotten” in the GDPR, then the tool needs to be capable of removing the entire history, the entire audit trail. Most enterprises, they demand that their providers are SOC compliant. Services like ours, and many Enterprise SaaS applications, process data from these organizations. We need to be able to prove on a regular basis that your tools are being submitted to advanced security testing, penetration testing, by a reputable firm. We need to be able to provide the audit reports that our customers require. It’s all pretty standard for large enterprises. For us it means that we pay a significant amount every year, simply to stay compliant for our large enterprise customers. Their auditors will come and check. It is very costly to do that, but it’s necessary to play in this space. Can you tell me a little bit more about your background before you got started and how that prepared you for what you’re doing now? I’ve been in this industry, the service management industry, for more than 22 years. I grew up with a new methodology, a new set of best practices that were initially published in the U.K. This set of best practices is called the IT Infrastructure Library (ITIL). It quickly became popular worldwide, but the thing that we started to do is to build tools to support those processes. The first company that I helped set up, together with our CTO, Laurens Pit, a co-founder of 4me, sold to Hewlett-Packard. For us, that was the first time that we went through this cycle. Later on, me and Laurens both went our own ways. I started a company focused on service management, more on how to properly deploy service management in very large organizations on a global basis. We licensed intellectual property on that to specialized consulting firms around the world. We sold that company to BMC Software, which at the time was the leader in the service management space. Laurens later sold his company to ServiceNow, which had then just become the leader in the service management space. By combining our experience, we decided that we had sufficient background to take on these more established players, like ServiceNow and BMC Software. We found that they were completely missing the boat on the cloud, although ServiceNow would definitely disagree with that, of course. They should be applauded for getting organizations onto the cloud with their service management solutions. However, they did it in a way that did not fully make use of all the capabilities that the cloud offers. Essentially what they did is provide a separate infrastructure for each of their customers. It’s virtualized, but it doesn’t allow for collaboration between organizations, which is where they are now lacking. When we saw that misfit, between what was happening in reality, with enterprise companies selectively outsourcing more and more of their services, and what the service management tools on the other hand were providing and the direction that these tools were going in, we thought that this was silly. Because in a couple of years, there will be organizations who run into a wall because they simply won’t be able to manage the large number of providers they have to deal with on a daily basis using their traditional enterprise service management tools. What made you want to apply to Alchemist? We had been in existence for a few years before we applied to Alchemist. We bootstrapped the company and were not in need of additional funding, because basically we had sufficient customers to cover our costs. Whenever we signed up more customers for our service and had more revenue coming in, that’s when we would add more people to the organization, not before then. So, we were not making a profit because we were reinvesting every dime that we received from customers into the growth of the company. The reason why we decided to join Alchemist is because we wanted to establish a narrative for investors. Ultimately, the goal for us is to do an IPO. At that time it has to be a logical narrative for future investors. We’ve identified a number of stages in our path from where we were at that time to IPO. On the investment side, we realized that we needed to get some funding to accelerate. Particularly in the areas of sales and marketing, where we had little experience, we needed to bring some people in. What we decided is that we’d sign up with Alchemist, which is very well-respected in Silicon Valley by other venture capitalists (VC’s). They would be able to open the door with other VC’s. Neither myself nor my cofounder went to Stanford or MIT, and we needed a way to establish more context in Silicon Valley. That’s what we were looking to Alchemist for, and that has been very successful. Even before we graduated from Alchemist, we were able to secure a funding round from Storm Ventures, which also specializes in Enterprise SaaS. How would you describe your experience at Alchemist? I really enjoyed it, and I learned so much. When you’re working with your product, mainly on a day-to-day basis, and trying to get more customers and look at features that set your product apart, you really have to switch your mindset at Alchemist to think about growth. Not just from one customer to the next, but thinking in broad strokes. In thinking of ways to get there, you’re thinking about funding as one way of helping you, but when you have funding, you need to find out what you’re going to do with it. You don’t have time to think about that during the day. Having certain topics addressed on Thursday evenings was really nice, because it helped us look at our company from a different angle, which always sparked new ideas. What do you think would define success for you and your company in the next 12 months? We’re trying to gain market share, and we primarily measure our growth by the number of users on our services. We track our ARR, and in the past few years, we’ve been pretty consistent in growing at about 50% ARR YoY (year over year). Ideally, if we do things right, we should grow a bit faster than 50% this year. That is always what we’re shooting for every year — that we get our sales and marketing so well-organized that we manage to sign up more customers, more quickly. What insights would you want to share with foreign founders, and the next generation of founders more generally? I believe that the focus on SDR’s (Sales Development Reps) — sending out emails, hiring sales reps, setting up sales calls to make appointments for demos, etc., no longer works. A few years ago, when it was new, it worked. These days, people get so many of these calls that they’re no longer effective. That has been a focus to some extent during the sessions at Alchemist, but I think it’s time to start looking at alternatives, like teaming up with industry analysts, seeing how you can use trade shows, seeing how you can carve out your niche. That is something Alchemist helps with quite a bit. There were a few sessions that focused on that, and gave us some great ideas. For the foreign founders, I believe that it is essential to be in the Bay Area. I don’t think it’s wise to think you can get VC funding here, while not being here. I always tell foreign founders that they also need to be a Delaware C Corp. I also tell them that it’s basically impossible to hire someone in the Bay Area if you’re living abroad. If you do manage to hire them, why didn’t they already have a better offer? It’s better to source talent in Eastern Europe, where people are super well educated, and not cheap, but affordable by Bay Area standards. If the founders are from India or Europe, and have a good understanding of the local culture, they should be able to manage people in their country of origin, from the Bay Area. The other thing to keep in mind for foreign founders is that it’s really hard to get visas. I’m a green card holder — I had to renew last year, and it was incredibly painful and time consuming. If you’re traveling with an expired green card, even if you applied for renewal at the right time and have a temporary extension, it becomes painful every time you re-enter the US. Why not just work remotely with your colleagues so they do not need to come to the US? What are some highs and lows you’ve had in the last month? One of the highs recently was an email I received from the legal department of a large managed service provider (MSP) that we’ve been working with to establish a partnership. We’ve been working with them for over a year already, and it’s taken a lot of time to go through their incubator process of looking at new technologies that they can use to get a competitive advantage. The email included a signed reseller agreement, which was the major milestone we’d been hoping for. A big low would be when one of your people who you’ve been training and investing in, leaves because they can earn 150% of their salary with another, bigger company. I don’t blame that person at all, because we can’t realistically match the offer, but it does set you back. The highs and lows come on a daily basis. You need to be able to stay in the saddle, particularly during the first few years, which can be an emotional rollercoaster — but also the fun part. Some people thrive on that, the adventurous nature of startups. That’s one of the things I really enjoyed about Alchemist — you could tell when one of the founders in your class had a rough day or a rough week. It was so helpful for someone to be able to tell their story and feel the support from the group, even just the emotional support. As a founder, you can really feel alone sometimes, especially when the rest of your team is abroad. What skill or lesson has been the hardest to learn, and has there been anyone that really helped you become a better founder? Pitching. I was not good at providing a decent pitch. At Alchemist, it was super helpful, not just to get practice, but also tips about what to do and what not to do. It extends not just to pitching VC’s, but also talking to customers. At a certain point in time, when you’re talking to CIO’s or C-Level Executives, they don’t care about the functionality of the tool anymore, they care about the vision. When you can paint that vision for them, if they get grabbed by it and feel like joining you on that journey, it’s wonderful. Alchemist has helped with that a lot. At Alchemist, the book recommendations were also really helpful. Each and every lecturer had something to teach us, some little nugget that we could take home with us and stew over, in addition to all the other things we learned. It opened a world that I hadn’t paid much attention to. I really enjoyed developing a new skill, like pitching, and it was definitely worth improving in that area. The experience was certainly worth it. About the Alchemist Accelerator Alchemist is a venture-backed initiative focused on accelerating the development of seed-stage ventures that monetize from enterprises (not consumers). The accelerator’s primary screening criteria is on teams, with primacy placed on having distinctive technical co-founders. We give companies around $36K, and run them through a structured 6-month program heavily focused on sales, customer development, and fundraising. Our backers include many of the top corporate and VC funds in the Valley — including Khosla Ventures, DFJ, Cisco, and Salesforce, among others. CB Insights has rated Alchemist the top program based on median funding rates of its grads (YC was #2), and Alchemist is perennially in the top of various Accelerator rankings. The accelerator seeds around 75 enterprise-monetizing ventures/year. Learn more about applying today.

BASF’s investment into Alchemist Accelerator promotes digital innovations in the chemical industry

Darren Kaplan - Managing Director, The Last 90 & Alchemist Accelerator Selection Committee Member and Mentor Founders who are in the midst of their roadshow will pitch VCs who say they are “founder-friendly”. Here are 3 tips to connect the dots between the self-proclaimed founder-friendly VC’s mindset and the tough but fair conversations they will have with you when your business hits some road bumps. Tip 1: “Friendly” might not mean what you think it means If your start-up has multiple founders, it is typically the CEO co-founder who is the point person to negotiate the term sheet. As the CEO co-founder, you need to have the self-awareness to accept that the VC acts as the corporate stewards in the best interest of the company, their LPs, founders, and employees. The rubber meets the road when your startup has a critical business issue. It could be the business is not performing at the hockey stick growth level, or that the company’s brand was hurt by a devastating HR related issue due to company culture problems. Great CEOs have self-awareness. They understand everyone is friendly when you are hitting your sales targets. But when you miss two consecutive quarters of revenue, or when your start-up is on the front page of the WSJ or TechCrunch for a Human Resources (HR) issue, there are consequences. The way the CEO leads and the speed it takes to navigate the startup out of the storm will dictate how long the relationship remains friendly. Tip 2: Deal Terms exist to de-risk, not to offend VCs and founders work with law firms like WSGR and Cooley to deploy billions of dollars a year in venture funding. There are few bad actors and no two term sheets are exactly the same. There are also many deals that fall apart. That is why founders are encouraged to get multiple term sheets. But a term sheet with a lower valuation than you expected or aggressive downside protection doesn’t mean the VC is not founder-friendly. It means that your traction, net revenue, growth and maybe the A team is not in a place to give you leverage in the negotiation. That is what is reflected in the term sheet deal terms. The more uncertainty the Venture Fund has in your business, the more they will want to protect their downside and their LPs’ investment. Traction and revenue growth will drive better terms. So have a short memory. Be willing to re-engage with investors who have passed on you in earlier rounds. Plenty of VCs miss deals that they wish they could redo. Tip 3 The intersection between founder-friendly and board governance The CEO co-founder is the only founder who reports directly to the board. It is the board’s role to hire and fire the CEO. This is an interesting dynamic when you have multiple founders. No matter how you package it, the lead Series A Venture Partner will sit on your board and will have the power to be not-so-friendly when the business is not performing. Again, this doesn’t mean they are can’t empathize with the sacrifices founders have made. At the end of the day, the board needs to ensure the company is growing and that CEO is the right person to make that happen. Darren Kaplan is the Managing Director of The Last 90 www.thelastninety.com an early-stage venture fund that invests and operates companies that are redefining the future of work. Prior to that Mr. Kaplan was the co-founder of hiQ Labs (www.hiqlabs.com), a data science company, informed by public data sources, applied to human capital to make work better. Mr. Kaplan is an Alchemist Accelerator Selection Committee Member and Mentor. About the Alchemist Accelerator Alchemist is a venture-backed initiative focused on accelerating the development of seed-stage ventures that monetize from enterprises (not consumers). The Accelerator’s primary screening criteria is on teams, with primacy placed on having distinctive technical co-founders. We give companies around $36K, and run them through a structured 6-month program heavily focused on sales, customer development, and fundraising. Our backers include many of the top corporate and VC funds in the Valley — including Khosla Ventures, DFJ, Cisco, and Salesforce, among others. CB Insights has rated Alchemist the top program based on median funding rates of its grads (YC was #2), and Alchemist is perennially in the top of various Accelerator rankings. The Accelerator seeds around 75 enterprise-monetizing ventures / year. Learn more about applying today.

What is a best-practice, repeatable process for validating product market fit? This is one of the most common questions I am asked. As an Alchemist start-up mentor, I help founders build a sales process to close their first 10 paying lighthouse customers. During my office hours, I am lucky enough to coach technical founders who are brilliant when it comes to math and process, but still sometimes need guidance when it comes to fine-tuning strategy.

Na’ama Moran - CEO, Cheetah Na’ama Moran came to the US from Israel to study economics, math and political science at Cornell. After school, Na’ama joined NYC’s emerging markets hedge-fund, Greylock Capital Management, as an analyst. She left finance to pursue her dream of building products that make people’s lives better with technology. She moved to Silicon Valley where she concurrently took classes in Computer Science at Stanford and co-founded Zappedy, a services platform enabling local businesses to close the loop between online marketing and offline sales. The company was acquired by Groupon in 2011. While working at Zappedy, Na’ama encountered a large variety of restaurant owners and food entrepreneurs. She discovered the hardships of running a restaurant and was surprised by the lack of transparency and ease-of-use in such an important marketplace. She decided to do something about it. Na’ama met cofounder Peretz Partensky while camping together at Burning Man. The two started working on what would eventually become Sourcery and raise $5M in funding. Her experience at Sourcery led to her founding Cheetah Technologies to be the easiest, fastest, and most affordable way for small-medium businesses to get their daily supplies and services. In her spare time, Na’ama loves to practice yoga, hike the beautiful Bay Area trails, and read science fiction books. What exactly is your startup bringing to the marketplace today? My company today is like an Instacart for small businesses. We enable businesses to order their daily supplies from their mobile phone, anytime and from any place, and connect to a large network of local and national wholesale suppliers. What was the impetus behind starting that? What made you think this is a good idea? What was the inspiration behind this venture? I’ve worked with small businesses for the last couple of years, initially with restaurants in my previous business, Sourcery. What was really interesting about this market is the lack of transparency and the lack of a convenient way for small business owners to manage their daily purchasing and know product pricing in advance. The way they manage their businesses is very antiquated. By accessing wholesale suppliers that are priced transparently on our app, and building this alternative supply chain, we’re enabling small businesses to have access to both local and national vendors, and benefit from a very convenient same day or next day delivery. Can you talk a little bit about your background before the startup? I worked in finance in a hedge fund for a couple of years right out of college. Then I moved to the Bay Area and I’ve been doing my own startups since then. For the last couple of startups I’ve run, I’ve been working with small business owners primarily in the food service space. That gave me insight into the types of problems they were having. Is there any previous experience or situation, either personally or professionally, that you felt helped prepare you for this startup? Was that working in finance or working with food services? Is there one thing that helped prepare you for what you’re going through today? I don’t know if there was one thing. I think it’s the connection of all the different businesses I’ve been doing for the last ten years. All of those startups taught me something different about finding product-market fit, building a scalable business, building and scaling a team. At my previous company Sourcery, which is the company that was enrolled in Alchemist, is when I got most familiar with the problems of small restaurants and small businesses in the food service space. It gave me deep familiarity with the problem and the impetus to come up with a solution. On the topic of Alchemist, what made you apply to Alchemist? I really like Ravi and his focus on the B2B space.I thought they had a very strong network of mentors. Now that you’ve gone through Alchemist, what do you think was the most valuable thing you took from going through it? It has a very strong network of mentors and alumni that is valuable for early stage startups. Especially people who are creating very large businesses in the B2B space and have a lot of knowledge and experience to share. The preparation for the demo day was very useful as well. What is the most challenging matter you guys are currently facing? Fundraising, talent recruitment, product development? I think recruiting in the Bay Area continues to be a very challenging endeavour, because the environment is so competitive. I would say being able to recruit top talent continues to be our biggest challenge. Our business is operations heavy and therefore, the various challenges we are facing have to do with scaling operations. Can you talk through one of the highest highs and lowest lows of the last month? We’ve grown our topline by more than fifty percent on a quarterly basis, compared to last quarter. This is definitely one of the highlights. One of the low moments we had, had to do with recruiting. We gave offers to people that we really wanted to bring onto the team and they we were not accepted. This was pretty disappointing. Looking to the future, what constitutes success and what are your goals in the next twelve months? Being able to meet or exceed our goals would be a strong indication that we had a successful twelve months. We have certain projections and they’re pretty aggressive so being able to, as they say, “meet them or beat them” would be really good. What entrepreneurial lesson or skill do you think took you the longest to learn or are you still continuing to work on? I think there is a skill in finding product-market fit. Unless you get lucky, you need to develop this skill in a very methodical, focused way. I believe I have been able to develop this skill over time, but I’m sure there is still a lot to be learned. Today, with my current company, I think we have a proof that we have found product-market fit and the biggest challenge is to scale the business very rapidly and be able to confront very strong competition in our markets. The challenge is different. The challenge is really about scaling a business and being able to sustain it, rather than figuring out if we have product-market fit. And so if you could hypothetically go back to yourself on the first day of your startup, what advice would you give yourself? Be able to let go of bad ideas and bad people faster. Is that similar to the Silicon Valley saying, “Fail quickly, fail often”? Is it better to get through a bad idea and move on to something good than to hold on to it? Yes. Being able to let go of bad ideas or bad strategy or bad people a lot faster probably would have made me successful faster than I have been. Do you personally have any advice for founders who are not from the US? It’s all about the network you build here. For people who are not from the US, it might be a little bit harder to build their networks. Being able to build a network as fast as possible is probably the biggest advice I can give. Has there been anyone specifically that helped you get to where you are today, that you think you wouldn’t be here if it weren’t for them? There are various people like that. Some of my investors have been incredibly supportive and informative in helping me to get where I am. There have been people I work with and colleagues that have been instrumental in helping me get to where I am today. I don’t think there is one person. There are multiple people, between investors, colleagues and mentors, that I can point to. How did you get in contact with some of these people and develop that relationship? That is something a lot of founders struggle with, building networks and trying to get to know these people. They find it really hard. It’s a good question! It’s just a matter of always trying to make connections or initiate meetings. Even if the meeting doesn’t necessarily work out to provide you what you want, ask the person to introduce you to other people that could be useful. Just constantly build that network with every meeting that you have. Be able to build a network through friends. I went to Stanford for a certain period of time, I met some people there. I went to Alchemist and YC, these are networks I am a part of. All these different organizations are ways to build those networks. Of all the jobs you can have, startups are more on the intensive side. The types of people that start companies, tend to have a passion for it. For you, whether it be five or ten years from now, what constitutes success for you personally and this venture? What would make you feel this was all worth it at the end of the day? I think it would be the impact I end up having on the lives of my customers and employees. Hopefully, I will see some significant monetary return for my efforts as well. I’m doing this to really have an impact and change the way people are doing business, and change the way our employees are living their lives. Creating wealth for both my customers, employees is my number one goal and inspiration. About the Alchemist Accelerator Alchemist is a venture-backed initiative focused on accelerating the development of seed-stage ventures that monetize from enterprises (not consumers). The accelerator’s primary screening criteria is on teams, with primacy placed on having distinctive technical co-founders. We give companies around $36K, and run them through a structured 6-month program heavily focused on sales, customer development, and fundraising. Our backers include many of the top corporate and VC funds in the Valley — including Khosla Ventures, DFJ, Cisco, and Salesforce, among others. CB Insights has rated Alchemist the top program based on median funding rates of its grads (YC was #2), and Alchemist is perennially in the top of various Accelerator rankings. The accelerator seeds around 75 enterprise-monetizing ventures/year. Learn more about applying today.

Scott Raney - Managing Director, Redpoint Ventures Scott invests in entrepreneurs at the seed, early and growth stages with a focus on cloud infrastructure, open source and SaaS. He’s especially interested in the rise of distributed computing and developer-facing businesses. Scott serves or has served on the boards of Guild Education, LaunchDarkly (an Alchemist company), Hashicorp, Platform9, Sourcegraph and Twilio, and led Redpoint’s investments in Stripe and Collective Health. Past investments include adap.tv (acquired by AOL), Cloud.com (acquired Citrix), Heroku (acquired by Salesforce), Jumptap (acquired by Millennial Media), and RelateIQ (acquired by Salesforce). Prior to joining Redpoint, Scott was responsible for new products at NorthPoint Communications, a data CLEC providing nationwide DSL services. Prior to NorthPoint, Scott worked at Bain & Company helping clients in the private equity and technology industries. Scott, how did you get into the world of Venture Capital? I’d worked as a developer, product manager, and business development manager at a variety of companies including a couple of startups. I had a passion for entrepreneurship and technology, and I had an opportunity to join Redpoint as an associate a number of years ago. I’ve been lucky enough to get promoted a number of times and be in a position to work with a lot of really great entrepreneurs over the years. It’s been a lot of fun. You said you were a developer. Is that what you graduated college with? I graduated with a B.S. in Electrical Engineering and had done a bit of software development as a part of my academic career. Then I joined, what at the time was called Andersen Consulting, but is now Accenture, as a software developer and, among other things, worked in their Advanced Technology Group. I did a lot of software development there at the dawning of client-server, and also got exposed to networking and communications and really fell in love with that. Is your background in software development what led to your investment in LaunchDarkly? I’m going to take it back a few years to 2007 and the launch of Amazon Web Services. As a former software developer, I saw the impact that would have on development, but also the emergence of this trend called DevOps, that we all know and love today. I met the founding team of Heroku, which was building the first PaaS (Platform as a Service.) Through that experience, I developed a deep admiration for entrepreneurs working on building products that developers love. You’re not selling products to developers, but you’re selling through developers to organizations to solve big business problems. Heroku is near and dear to my heart and I learned a lot about the power of developers through that time. After that, we invested in companies like Stripe and Twilio and another company called Sourcegraph that’s working on “code intelligence” again to help developers accelerate writing software. Through these experiences I was lucky enough to meet Edith and hear what LaunchDarkly was doing. It felt like it was the perfect continuation of that trend. It’s a piece of technology and a solution that helps developers, but ultimately unlocks so much value across an organization and could have a profound impact on how they think about their business. What separated them from the other investments you were thinking of making in the space? The things I look for when we find these developer-facing businesses are indicators that the projects have impact not just within the development organization, but with other functional areas. By changing the software development lifecycle, these companies can end up having repercussions that affect product, marketing, and even senior level decisions how a company runs its business. LaunchDarkly was an amazing example of that, through the idea of feature flagging: the ability to transform the velocity at which you could release product; the ability to give product managers control to deliver specific features to individuals; the ability for marketing to be able to provide early looks on functionality. These are interesting, profound capabilities that span across an organization. Maybe the most exciting thing to me is, we talked to one of their early customers during the due diligence. It’s a very successful, large company today, a brand name. We talked to the CEO who was not only aware of the impact LaunchDarkly was having on the organization, but talked about how it impacted the way he managed the business. It changed the way he thought about what his team could do. I was incredibly excited when I heard that, because that’s the way you create massive value and have the opportunity to build a significant business. What are your thoughts on Alchemist in general? I love what Alchemist is doing. I think it’s clear that when Alchemist got started, there was a dearth of opportunities for entrepreneurs thinking about enterprise businesses to find mentors and advisors and organizations that could them to help them grow those ideas. Ones that understand the nuances associated selling to enterprise buyers. There were things like this available to consumer and more consumer-like enterprise businesses, but there were very few people that could act as a resource for entrepreneurs who wanted to build traditional enterprise businesses. I’ve heard time and time again from the people that go through the program just how much value they’re getting out of it. I don’t want to suggest here that building a consumer business is easier than building an enterprise business, far from it. They’re very hard, but they’re very different. As a young entrepreneur, when you think about selling to businesses, there’s some realities you just have to know. You have to understand what it means to build an enterprise-grade product. You’ve got to understand what it takes to market to enterprise buyers, and you have to understand what it takes to build and manage a sales force that can sell to enterprise buyers. Having an organization that helps young entrepreneurs understand the importance of all those things and what it means to do that is invaluable. I view it as a pretty unique entity in terms of what it’s doing. The entrepreneurs that have been a part of the program say it was incredibly helpful. What’s the size of Redpoint, and how does it compare to other funds of similar stage in the Valley? We’re a unique animal in that we are always actively putting money to work out of two funds simultaneously. We have an early stage fund that is $400M focused on Seed, primarily Series A and occasionally Series B. We also have a $400M early growth fund that is focused on Series Bs and Cs. As a result, we span from Seed all the way through mezzanine financing with these two funds totaling $800M.It makes it a lot of fun for us. Our approach in the way that we we work with entrepreneurs, is they do not need to worry about which fund the money is coming from. Here we’re going to work every deal exactly the same with an identical approach to thinking about engagement with entrepreneurs and the value that we want to add to them. We just have two pockets we can pull from. What size checks do you typically write and how is that structured? It’s a hard one to answer given our stage-agnostic approach. We write seed checks of a few hundred thousand to grow checks well north of $30M. The most important thing for us is to not try to force an entrepreneur to raise an amount of money that isn’t in the best interest of their company. Ultimately, we want to do what is in their best interest and the good news is we have the flexibility to support a couple of smart people with an idea all the way up to a company well on its way to an IPO. What stage do you prefer to enter into, if there is a preference? The earlier we can be involved with great entrepreneurs, the better, but again we are primarily interesting in working with great companies regardless of stage. Does your fund have a specific focus? Broadly speaking, Redpoint invests in disruptive ideas across both enterprise and consumer technologies. That being said, with the rise of things like artificial intelligence and what’s happening within SaaS and cloud, we’re finding ourselves moving into adjacent markets. We’ve been spending time understanding how things like machine learning can transform the drug discovery process and the delivery of healthcare. We are spending time in areas like space and robotics. We have a pretty wide aperture. The common denominator is we are looking for bold ideas. Companies that are building innovative technologies and that have the chance to fundamentally transform a market. How do you think your fund differentiates itself from other funds? First and foremost, it starts with entrepreneurs. Few jobs are as challenging as that of a founder creating and scaling a business; our team’s job is to work collectively for our founders and help them build successful companies. We view ourselves as going to work for the entrepreneurs, as opposed to them going to work for us. It’s a privilege. As a firm, we’re very collaborative in nature and we take a team-based approach. Most of our team have been former operators or founders ourselves and we have a deep empathy for the entrepreneur’s journey. We try to operate like a startup ourselves with a small and nimble team. Our firm’s 19 + year legacy gives us a fair amount of experience, perspective and connections, as well as a foundation for doing what’s right for the entrepreneur. The last thing I would say is that we really have deep domain expertise and we invest a lot of time and energy in building the networks and relationships around the thematic areas we invest to make sure that we can make a difference. This allows us to see over the horizon, and help our companies do the same. How do you think you individually differentiate yourself from other VCs? I try to be the best possible partner that I can be. I’ve been lucky enough to be a part of a lot of great companies and to have had a chance to work with a lot of great entrepreneurs. I hope that when they sit down across the table, they’ll say “This is somebody who helped me, who had my best interests at heart, and who was great to work with.” The other thing is just try to be a good human being. This is a long term relationship and we’ll be working with these folks for many, many years. The last thing that an entrepreneur needs is to be dealing with somebody that isn’t 100% aligned with them and has their best interests at heart. I try to make sure that I’m always looking at the world through their eyes and trying to be as helpful as I can. What makes an investment compelling for you? It starts with the team. We spend a lot of time in our diligence process assessing whether or not we think a team has the opportunity to build something really differentiated and transform whatever market or industry they’re part of. That is top of our list, bar none. We want to work with good people that we think are going to do things the right way. Second, we look at the markets the companies are operating in. We want to be going after big markets and taking bold bets. The last thing is we look for products and technologies that are differentiated and will create defensible moats making it difficult for other people to replicate. That used to stand primarily on the basis of high quality products and good technology. Increasingly, a lot of businesses we look at have other moats like network effects that can be extraordinarily powerful for businesses. In enterprise increasingly there are communities that get built up around some of these technologies. We put that all together and try to find things that are special and where we feel we can add value. Bottom line is, we want to work with great people, and they come in all different shapes and sizes and all different experience levels. We’ve been fortunate to work with a lot of folks who are building amazing businesses as their first job. We’ve also been very fortunate to work with experienced executives who are doing it for the second, third, or fourth time. In the end, we don’t think that talent comes in one shape or size or profile. At some level, to be a great entrepreneur, it’s some magical combination of intelligence, grit, determination, and experience. There’s always a different combination of all those things, but in the end we think that people that have a vision for the future and have the ability to get it done are what matters the most. Is there was a piece of advice that you could give to founders fundraising, that doesn’t get shared enough, what would it be? The more honest and open and transparent you are, the more likely you’re going to find somebody who is investing for the right reasons. I encourage everybody to make sure that you’re not trying to manage the conversation. As an entrepreneur you need to be able to sit across the table from your investor and lay it all out there — the good and the bad — and get an honest reaction. It gives me great comfort when founders name the issues or challenges in their business because I don’t feel like I’m being managed and I don’t feel like there are things I don’t know. Obviously, things are not always going to be going up and to the right. Every company has things that need to be worked on. Once I know what the issues are, it’s much easier for help the entrepreneurs. There are a number of founders in these conversations that feel like they need to come off as infallible and “we’ve got this, it’s all good.” No business is like that. Which investment are you most proud of and why? I love them all the same! But Heroku is special to me because it was my first investment. It wasn’t obvious at the time, but I loved the founders and their vision. Seeing their success was incredibly gratifying. As with all our founders, I am forever grateful to have had the chance to work with them. What areas are you excited about now and in the future? It’s a broad question and I don’t think I’ll be exhaustive in my answer. I will tell you where I spend a lot of time personally. I believe in this move-the-cloud-native movement — this move away from traditional monolithic to microservices and from on-premise to the cloud. These moves are having profound repercussions it has in terms of software development, deployment, and operations, and also the impact it has on a company’s ability to move faster than ever through software. You can look at every tier of the application stack and realize that they’re going to be fundamentally changed. Many already have been, but there are many things left to do. I’m a big believer in things which help organizations move to the cloud. I’m a profound believer in the power of the public cloud and the long term trends there. All the solutions that help companies begin to make that migration, I’m very excited about. We continue to be interested in SaaS in the way that it’s moving beyond broad horizontal applications and into more vertical solutions that do more than just automating a business process, but really help people do their jobs better by delivering insight. We continue to be excited about the long term trend trends there. And as I mentioned earlier, we’re very interested in broad applications around AI and ML and in particular how these technologies might disrupt industries typically not addressed by venture capital.

James Cham - Partner, Bloomberg Beta James Cham is a venture capital investor with Bloomberg Beta, a firm focused on investing in the future of work. James invests in companies working on applying machine intelligence to businesses and society. Prior to Bloomberg Beta, James was a Principal at Trinity Ventures and a VP at Bessemer Venture Partners, where he focused on consumer services, enterprise software, digital media; and served on the boards of CrowdFlower, Open Candy, LifeLock, ReputationDefender, Sonic Mule, and BillShrink. He was previously a management consultant at The Boston Consulting Group and a software developer. James received an MBA from MIT’s Sloan School of Management and Computer Science degree from Harvard. How did you get into the world of Venture Capital? After the startup that I was a part of got acquired, I went to business school. A good friend of mine introduced me to a firm called Bessemer, where I got my introduction to venture capital and how I ended up investing in startups. And before Venture Capital you were a software developer? That’s right, I was a software developer in the late 90s to early 2000s. I was part of that transition from client-server over to web-based, enterprise applications, and I wrote a bunch of mediocre code and made a bunch of bad design decisions that other people suffered for as a result. So I’ve been through enough cycles to least understand what that feels like from a potential customer perspective. Why did you invest in LaunchDarkly? Let me take a step back. When we raised money from Bloomberg to start the fund nearly five years ago, one of the core claims was that we are living in a world where everyone’s a knowledge worker. In that world, we should look at the best knowledge workers around. We should copy their techniques to find ways for them to scale what they’re doing. And of course, the best knowledge workers in the world are software developers. This is in part because some of the best software developers are a mix of lazy and smart — they spend all their time avoiding working on applications and instead work on frameworks and systems infrastructure. So broadly, that is what we’re excited about. LaunchDarkly is exciting for two core reasons: One, there was an immediate sense of recognition of a problem. When I first heard Edith pitch the idea, I thought “Oh my goodness! I wish this existed when I was being yelled at as a software developer or when I was managing projects.” There’s a sense that this should exist and this is the right way to do something. I think most software developers do this. You build your own bad bug-tracking system or slightly lame issues-tracking system. And I had done something like a features flag product for some other project, but I didn’t call it that. There was a sense that Edith understood this and saw this more clearly than I did. That’s one excitement. And then there’s the other reality which is the excitement of seeing a leader like we did. There’s a point when you meet her and say, “Oh, she’s not just someone who has built something interesting, but she’s someone you can see leading something important.” That’s another important part of what made it exciting for me. As I’ve gotten to know her better, that’s only been validated more and more. You met LaunchDarkly through Alchemist. What are your thoughts of Alchemist in general? The thing that is most helpful about Alchemist is that it’s more systems driven. The people around it are quite credible and thoughtful. You look at the set of advisors: These are people who aren’t really famous and lightly involved, but rather accomplished and very deeply involved. From my perspective, that makes the process of diligence and validating people much easier. There’s always a sense about Alchemist that you’re being as positive as possible about the opportunity, but at the same time you don’t lie. That’s an important thing for an investor and really helpful. What is the approximate size of your fund? How does that compare to other funds in a similar stage? As the markets are fragmented, even in the earlier stage, judging how we compare to other funds does become more complicated. But the core physics of our first fund was $75M, and the second fund is also $75M. Our first check sizes range between $100K to $1M, and we participate anywhere from friends and family rounds to right before the Series A. Does your fund have a specific vision or focus? I know you’ve touched on the future of work prior, but is there more to that? We talk about the future of work, in part, because historians of science would say that it takes two generations of managers for any new technology to really make an impact on the economy. At the start of our fund, we were twenty years into the Web — networked computers, which is another way to think about it. We were convinced that it is only now we’ll see massive changes in the way people work, because now you have a bunch of people creating businesses that are suited for the Web. Within that vision, we have a focus both on productivity for knowledge workers — we see a lot of opportunities to integrate and learn from developers — and the way software ends up changing the way that people do business. New tools will be required to support this new kind of business, which include developer tools up to enterprise software. We also believe that machine learning, model building, and AI in general are different than normal software development. I think they have profound implications that we haven’t understood yet, not just on all the cutting edge research we’ve done, but especially around the way that people make good software and machine learning models. Machine learning model building is different than software development. The economic characteristics are different, meaning machine learning will give rise to new business models. So somewhere out there, there’s going to be a person that is the Bill Gates or Marc Benioff of machine learning. They are going to do a mix of marketing, technical, and product insights and come up with a different way of providing machine learning or AI-driven businesses in a different light. They are going to charge in a different way or sell it in a different way. That’s the innovation or change in the way that people do business that we’re most excited about, and where we spend a lot of time. How does your fund differentiate itself from other funds? On the one hand, the money is a commodity. The money is the same, and so the way you differentiate is you bundle different services along with it. Some of that is the personality of the partners and the way that they relate to other people. A part of that is also a set of things that we focus on. I think, we think through more than other firms ways that founders can make a dent in the universe through the way they talk about themselves. On that side, we’ve thought a lot out. And we work with our companies a lot around that. So much of it depends on the specific relationship that each partner has with the founder that that investor has invested in, especially at the seed stage. There aren’t magic formulas. How do you individually differentiate yourself from other individual VC’s? The right way to compete along those lines is not to compete. Instead, I’m most interested in angles that people aren’t thinking about yet. And I’m most interested in thinking through angles that are poorly understood. So if someone has just another generic SaaS company that’s growing at a certain percentage, then I’m probably not the right person for them. An old friend of mind would say that there’s two types of VCs. There are VCs that if they weren’t VCs, they’d be bankers, and others who are VCs because they spent too much time pitching. I’m definitely part of the second camp. There are a whole set of ideas that should be enabled and would be if someone stuck their neck out and said they believed this founder could create something special and make the world better. And that’s what I try to do. What makes an investment compelling for you? Is there something in particular that makes an investment more compelling than not? There are all the things that people talk about: traction, the team’s experience, potential, etc. I think those things are all really important, but the thing that might be underappreciated is that core insight. Sometimes the founders don’t understand what the core insight is. There is nothing quite as exciting as sitting with a founder and discovering together what actually makes them special. And oftentimes that core insight can be communicated in a paragraph or it could take a lifetime to get there. For me, that’s what I’m looking for that. It’s going to be in areas where I have enough preconceived notions that someone could surprise me. What is the number one red flag for you that would make you pass on an investment? The moment I feel like I can’t trust someone is probably the number one reason why. When it’s close or we thought we should have invested, that tends to be the number one surprising thing about most folks that we pass on. Investing in a company is not something you take lightly. We take it very seriously and it’s a relationship we take very seriously as well. What separates the great founders who get an investment from you vs. the good founders who don’t quite make the cut? There’s a way in which the best founders help you believe. Whether it’s helping the investors believe or first customers or the first employee or the co-founders. And that way of getting someone to believe, it comes in all sorts of ways. It’s not generic. It comes in many sizes and forms, but that ability to impose your will on the universe. It only works if you can convince other people. Would you be more likely to fund a very experienced team with a mediocre idea or a team of novices with an amazing idea? Nuance matters a lot here. I think that there are plenty of times when the very smart, experienced team can take a mediocre, initial idea and because they are so customer-oriented or technically visionary that they end up building something better, smarter, or more interesting. However, generically, I hunt for people who have extraordinary insight and how they get there. The insights do not have to manifest themselves with the first product, but they manifest themselves somehow that makes them extraordinary. Is there any piece of advice you would give founders who are fundraising that you think does not get shared enough? I think founders forget how much power they have in a situation. There are cycles that founders get in where they end up feeling like this is just another boring sales call. But what the founders are doing is they’re sharing their most precious things. They’re sharing things that they probably care more about than almost anything else in the universe. When they pitch, they should treat it that way. That investors are lucky to get a view into this. The moment the founder forgets that, humans can smell it. You have to continue to be resilient and continue to believe because investors, although we do it through a financial instrument, at the core, we’re declaring we have faith in someone and we have enough faith that we’re putting our money and our goodwill behind it. If you think about Edith and the way that they were together and the way that they communicated and seemed to take what they do seriously, even when things are difficult, that’s the sort of thing that an investor is looking for. What areas are you excited about now and in the future? I’m excited for when things that we call AI-related start being machine learning-related and get boring. When everyone understands how to engineer a bunch of problems, things get boring, and that’s when you end up with a lot of product innovation. I’m very excited about that!

Edith Harbaugh - CEO, LaunchDarkly CEO and co-founder of LaunchDarkly Edith Harbaugh has raised over $30M in funding from investors at Uncork, DFJ, and Redpoint. She has more than 10 years of experience in product, engineering and marketing with both consumer and enterprise startups. Edith was Product Director at TripIt, where she launched TripIt for Business and ExpenseIt. She holds two patents in deployment. Edith earned a BS, Engineering from Harvey Mudd College and a degree in Economics from Pomona College. She enjoys trail running distances up to 100 miles. What exactly is your startup bringing to the marketplace? I co-founded LaunchDarkly with John Kodumal to help businesses all over the world improve the way they build their own software. Software turned out to be a much bigger market than we initially thought. We have your traditional SaaS companies, as well we have eCommerce, IoT companies, airlines, automobiles, and even cruise lines. Software is far more pervasive in running everyday life than people realize. What was the impetus behind creating your startup? Both John and I have been in software our entire careers. John was a developer & manager at Atlassian Marketplace. I started off in engineering, was frustrated that smart people kept building products no one wanted, so became a product manager to build what people wanted. I then saw that you could build the right thing, but if no one knew about it, it didn’t exist. So I also got into marketing. We were both frustrated with a lot of processes that were happening about building products . We saw that the smarter companies had a framework like LaunchDarkly where they could control features, and manage without them. We wanted everybody to have that same power. What is the most challenging matter you as a startup are currently facing? Right now we are in the scale period. It’s a good problem. We have a lot of customers. We serve twenty five billion features a day, so we’re just getting bigger and growing the team. Can you tell us a little about your background before you started your startup? I was originally an engineer, and have several patents on deployment. Then I was product manager at consumer companies. While working at an Internet of Thing startup, I also did marketing and got them to $1M in units. Most recently before my own startup I started “TripIt for Business”, the business side of TripIt, which was one of the reasons Concur acquired TripIt for over $100M. have been at big enterprise companies. I’ve been at small consumer startups. And I’ve been at IoT hardware companies, so I have really seen the spectrum of how software is built. What previous experience or situation do you feel best equipped you for your current role? I think because I was an engineer, I was used to stuff always being fluid and changing. I looked at everything as an opportunity to learn more. What was your first real job? I was a programmer, programming Visual Basic for a defense contractor in Arlington, CA. If you could go back to the first day of your startup, what advice would you give yourself? To figure out sooner what I was uniquely good at and to hire other people for other things. Our investor Andy McLaughlin refers to this as “leverage” — how can I best spend my time? What made you to apply to Alchemist? Why not others? Alex Shartsis, a coworker at TripIt, had gone through a prior class and highly recommended it. What was the most valuable thing you took from being a part of Alchemist? I actually wrote a whole article for VentureBeat on why I found Alchemist so valuable. There are really three different things. We got our first customers, not just little startups, but we actually got Yammer as a customer because we were sitting in their office. That wouldn’t have happened without Alchemist. Second, we got this amazing network of mentors and coaches, in particular Sean Byrnes, co-founder of Flurry, who to this day is still our coach. He’s not a coach with a Big C anymore, but I still look to him as somebody who I can ask for advice, guidance and mentorship. We had amazing mentorship and network of coaches and got fundraising advice. Third, we were a tiny struggling start up just a two of us. We got help and advice from people in the same situation. Like, we would all eat lunch together every day in Yammer, and dinner as well at Yammer because we didn’t have any money to eat out. It was really valuable to be with people who are going through the same thing. If you were to do Alchemist again would you approach it differently? I wish I had asked a couple of my mentors for angel investments. I think they would have put in and I would be closer with them now. I think they were waiting for me to ask and I never did. What entrepreneurial lesson or skill took you the longest to learn or are still learning? Something I’m learning is how to have a board. I think our board members are great, it’s just on me to figure out how to get the most out of board meetings. Has there been someone that has helped you along and that you don’t think you’d be here if wasn’t for them? How did they do it, how did you find them, how did you build that relationship? I still think that I would be here. I have a lot of confidence in John my cofounder and myself. I do think our Alchemist coach, Sean Byrnes, has helped us every step of the way. So while I think we’d still be successful, I’m certainly grateful that he’s helped us. Do you have any inspiring or favorite movies, TV shows, podcast, books or media in general? It’s kind of corny, but I like Bryce Courtenay’s book, “Power of One,” which is about a South African boxer. He talks about training and winning as an underdog. What constitutes success for your startup in the next twelve months? More happy customers, bigger happy team. What constitutes success for you personally? I really like coming back to Alchemist and teaching a class on fundraising. I like it because I have taught it for about three years now. And people that I’ve taught now have gone on to raise literally millions of dollars. Are there any insights you have learned that you want to share with the next generation of entrepreneurs? I think there’s this Hollywood myth of entrepreneurship, where they think you show up in Silicon Valley, and you get the fancy office and all the money and all the VCs chasing you and you’re hounded for interviews about how it goes. I feel like LaunchDarkly is at the beginning of that stage right now. We have an office in Oakland, we have a large team. We can afford to go on trips to our customers, to get booths at conferences. But the first two years were tough. I ate all our meals at Yammer because I didn’t have any money. I & my cofounder didn’t take a salary, and It wasn’t to be cool, it was because there was no money to pay us with. I was literally living off my savings. The first round of T-shirts that we got, we only got enough for people that we were sure would wear it. If somebody wanted a shirt I was like, “Will you wear this? If not, we’ll save it for someone else!”” And I think, yes, you do get to the stage where stuff starts to work and you do have the fun startup thing. But there’s so much work and a constant grind. It took us basically a year to build our product before it was sellable. This was a year for us grinding away, getting people into our beta product, getting their feedback, and continuing to build before we got a dime in revenue. Looking back I remember how stressed I was, or remember the times I was thinking “What am I doing”, but there was always this kernel that kept me going, always telling myself there’s something here, there’s something here. The perception you’ll start your startup and get rich overnight — I’ve seen actually that, it does happen, there’s couple of people. I had a friend from a portfolio where they were in business for eight months, they had a good demo day and they got bought for a lot of money. But that’s like the one in hundred thousand. But those are the things that people like to broadcast and consider the norm, instead of the diamond in the rough. I have also seen other friends from my same batch still grinding it out and they’re just getting their A now. That’s the joy of startups, you’re creating something and if you’re in it for money, there are far easier ways to do that. If you’re good engineer and get a product manager, surely, you can get a good job and make more money. I think people should do startups if they really care about building something, building a product and team, feel like there’s that need, but you’ve got to be ready for the long haul. It’s not an overnight thing. Startups don’t hear that enough. Which is the sad part, because if we look at that statistics, out of all the thousands of startups 90% die and 1% of them succeed. The rest of them are in this middle ground. You asked us what got us through tough times. The thing that kept us going was we always really believed in what we were doing. It wasn’t that we wanted to get rich. We believed this needed to exist. As soon as we got our first customers, we poured everything into making them successful. There were so many low points but we just really believed. When you talk to a startup founder, you can quickly tell what reason they’re doing it for. When the first question is, “We need money” and they don’t like the response, “Well, you don’t really need money. You have to figure out what customers want and we will ready to pay for it” and if their response keeps coming back, “I need money” to pay themselves, hire more people, find someone to sell for them, basically do everything to have the cushy job and build a company. I mean John and I after not taking a salary for our first six months, only took a low salary after because we wanted to get healthcare for our first employee. Any closing thoughts? There was actually an advantage for us because we were older. We were in our thirties, so it wasn’t a hobby for us. John gave up a very stable job. He had a wife and a kid. We had to run this like a business. There’s a huge opportunity cost, that you’re not at another job making mid-career salaries We were always very disciplined about, “Does this feature matter, what will people pay for it?” Sure, we had disagreements but they weren’t fundamental disagreements, they were more, “Does somebody want to buy what we’re selling?” So we ended up in a very good position to run a business like a startup. About the Alchemist Accelerator Alchemist is a venture-backed initiative focused on accelerating the development of seed-stage ventures that monetize from enterprises (not consumers). The accelerator’s primary screening criteria is on teams, with primacy placed on having distinctive technical co-founders. We give companies around $36K, and run them through a structured 6-month program heavily focused on sales, customer development, and fundraising. Our backers include many of the top corporate and VC funds in the Valley — including Khosla Ventures, DFJ, Cisco, and Salesforce, among others. CB Insights has rated Alchemist the top program based on median funding rates of its grads (YC was #2), and Alchemist is perennially in the top of various Accelerator rankings. The accelerator seeds around 75 enterprise-monetizing ventures / year. Learn more about applying today.