Monday, December 29, 2008

Saturday, December 6, 2008

Public Infrastructure and Entrepreneurship

As a political progressive in a entrepreneurial industry I am often frustrated by the myopic, Republican "small business" and entrepreneur faction continually beating the facile drum of tax cuts and small government. This is counterproductive to the noble venture of entrepreneurialism.

This morning I was heartened and inspired by Barack Obama's public works and infrastructure pledge.

Nothing could be better for long term economic growth and continued American leadership in innovation than a broad range of infrastructure improvements. Think of it as outsourcing your costs, focusing on your core business proposition, getting a subsidy and a research grant all in one.

Consider this, according to McKinsey: "Health insurance expenses are the fastest growing cost component for employers. Unless something changes dramatically, health insurance costs will overtake profits by 2008." If employers didn't have to worry about paying and administering employee health-care plans, you would not only have more free cash to go around, but you would have more attention to devote to excelling at your business's core competency. What's more, employees and entrepreneurs who were secure in health coverage that was not tied to their employer would be much more willing to take a flier, start a company, or even merely create more liquidity in the labor pool by reducing the transaction costs of switching jobs.

How about investment in education? Toyota, renowned for business process acumen, prefers to site new factories in Canada instead of the Southern United States not only because of the healthcare advantage, but also because of the education advantage - better educated and trained workers lead to a long term productivity and quality advantage.

This same effect has been well documented at a larger scale in descriptions of the concentration of innovation, wealth creation, and education in the coastal cities of the United States West coast, and Northeast, like Richard Florida's various Creative Class work.

Not coincidentally, it is these same cities that invest the most in public infrastructure. Just for instance, despite substantial room for improvement, voters in Seattle uniformly pass each new parks and school levy that shows up on the local ballot.

Which brings us to transportation infrastructure. No one benefits more from better transportation than businesses. If employees have low-stress commutes (reading on the train, etc.), they are liable to be more productive, and generally appreciate their current 'life situation' more than if they have to fight an hour of aggressive traffic. Obviously, traffic delays have a huge opportunity cost in terms of employee time as well, even leaving aside environmental externalities. If you deliver physical goods to customers, getting purchased items delivered faster and at lower cost is central to delighting your customers. And this leaves out public investment in faster and more extensive broadband infrastructure to grease the wheels of more and richer internet services.

Moreover, public focus and investment in kick-starting cleantech and green energy innovation will give the next wave entrepreneurial innovation and wealth creation the same catalyst that the cold war and defense spending contributed to the genesis of silicon valley.

Nothing short of a 1999-style IPO market could be better for entrepreneurialism than Obama's public infrastructure investment plan.

Thursday, December 4, 2008

GetRichSlowly - BEFORE you get laid off

Kevin has an awesome post up on 10 vital things to do before you get laid off at GetRichSlowly - please vote it up!

Sunday, November 16, 2008

Reservations About Kiva Gifts

One of my friends wrote me today for advice on Kiva. Please comment here with your thoughts. For context, my friend does research on sustainable fisheries in the Philippines, so she knows what she's talking about:

Matt,
I'm interested in giving my family 'presents' in the form of money to spend on Kiva, but I really want to make sure that the projects Kiva supports/advertises are 'good'. They should be sustainable! I've heard lots of nightmares about lending programs from developed to developing countries and seen 1st hand the destruction they cause when, for example, rural, uneducated people get 'loans' to 'develop' and really don't realize they will have to pay the money back in the end. That is much more of a World Bank model and Kiva seems to be better at that, but when I found this http://www.kiva.org/app.php?page=businesses&action=about&id=73470&_tpos=f&_tpg=h I started to wonder again. Tell me if you can see why I think this is a very bad idea.

I think that the idea of microfinance is great, but I'm not convinced that it works yet. All these devleoped country people who feel great having contributed to what they think is a worthy cause may just be contributing to the ultimate demise of the people they thought they were helping.

Do you know of any other organizations that have a better 'sustainability' check on the programs they support?

Thanks

Saturday, November 15, 2008

Layoff to Jackpot

I just overheard a great quick story in the barbershop this morning. The woman sitting next to me getting her hair cut told the woman cutting her hair that her mom got laid off from Boeing, moved to Reno and got a job in a casino. Casinos pay employees weekly because there's such high turnover. The day the mom got her fist pay check, one week after starting, she asked her boss if she was allowed to gamble in the casino. her boss said no, employees aren't allowed to gamble in the casino, so she took her paycheck across the street to another casino, hit the royal flush on video poker, won $375K, walked back across the street and quit. Her boss said that people sure do turnover pretty quickly, but usually that quickly.

Friday, November 14, 2008

Black Friday Deals on blist

Now you can track 2008 Black Friday deals on blist, search for specific deals, stores, or items and ultimately save money. This data will be continuously updated as new deals get found and surfaced:


Black-Friday-2008

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Grab this Black Friday widget yourself and post it on your blog by clicking the 'publish this blist' button at the bottom of the widget.

blist lets you take data that is available on websites, squish it down to the essentials, and leave out all the junk that you don't care about.

Wednesday, November 5, 2008

Dalai Lama Via Pico Iyer

"It’s no good offering people peace if those same people lack food and water; and it’s no good offering them food and water if our forests and rivers are polluted. It’s no good, even, to clean up our environment if we’re still polluted within. In short, the solution to all of our problems, economic, environmental, political, spiritual, can only be addressed by going back to the fundamentals. Reforms on the surface make no difference whatsoever."

The Dalai Lama via Pico Iyer in The Open Road

Great book - highly recommended.

Sunday, November 2, 2008

I'll be at Defragcon Nov 3 and 4


I'll be at Defragcon tomorrow and Tuesday November 3rd and 4th with lots of smart, cool people in Denver.

Kevin will be speaking on the democratization of data.

Tuesday, October 28, 2008

Kransekake - The Best Recipe


I made Kransekake - or 'Norwegian wedding cake' - last night. In Danish it's spelled Kransekage. The best and simplest reference recipe is this one from the Sons of Norway. I love Kransekake because it's both a tasty dessert and a hearty breakfast.

Friday, October 17, 2008

Bessemer SaaS Law #10

Bessemer SaaS Law #10. Be prepared to cross the desert - SaaS requires R&D and sales expense up front for a multi-year stream of revenue, so it demands enough investment capital to fund 4+ years of runway. Load up for the long trip and pace your consumption of calories!

There is no denying that the cash flow characteristics of a SaaS business are wonderful in the long term, but lousy in the short term. The traditional software model with $100,000-$1 million licensed software and “net 60” payment terms presents a far rosier cash flow picture than monthly subscription streams of $5,000-50,000. This means SaaS companies must have impeccable financial stewardship. There have been many promising SaaS startups that stepped on the gas too early and were wiped out as a result. Always model the business with a comfortable cash cushion and recognize that
most SaaS businesses paradoxically consume more short-term cash if you start growing faster.

As a business, it is critical to weigh forward investments carefully. SaaS businesses typically require multiple rounds of investment and a good amount of capital. For example, it took $126m to NetSuite to go public, $66m for DemandTec, $61m for Salesforce and $45m for SuccessFactors. We believe that the best of the second generation SaaS businesses may be more efficient than many of these predecessors, but in almost all cases, significant capital will be required to build a dominant SaaS business.

As you grow the business, you should also constantly trade off cash vs. growth. If you must replenish supplies while still crossing the desert – and most SaaS businesses will need to raise multiple rounds of funding - optimize your growth rate (sales rep recruitment and marketing spending) so that you maximize your CMRR when you need to fundraise next. As private investors and public acquirers become more SaaS savvy, multiples of CMRR will likely become the primary valuation metric.

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Bessemer SaaS Law #9

Bessemer SaaS Law #9. The most important part of Software-as-a-Service isn’t “Software” it’s “Service”!

One of the most valuable and least appreciated assets of a SaaS business is the detailed usage data of your customers. For years, product marketing and product management groups in license software businesses have attempted to guess at the behavior of their customers. Good PM’s would interview, survey, and even watch their customers as they used the product, but it was very hard to truly know how they were using the product on a detailed level and incorporate this feedback in the major annual releases. SaaS businesses should instead learn from their consumer internet peers, and the user interaction methodologies of businesses like Google, Apple, Yahoo, LinkedIn, Yelp, Facebook, and others. These businesses are constantly taking advantage of their web application architecture to analyze detailed customer usage data, a/b test variations, iterate on small details of a page or a feature, and evolve the product each and every day. There are three levels of being Service Savvy, and SaaS businesses should strive for all three:

1) Basic proactive monitoring for likely churn or up-sell opportunities – this is too simple not to do, and all SaaS businesses should do this well. You already know who logs into your product, how often, what they do inside the product, and what results they achieved. So now you need to track the key usage metrics and measures, and create internal dashboards to know which customers are getting the most value (potential up-sell candidates!) and which are likely to churn (time to proactively intervene!). Work with your marketing team to automate “low usage” reports internally, and low usage escalation emails to your customers to ask them for an explanation of the behavioral changes.

2) Rapid testing and development cycles of your application based on customer feedback. Lookat what your customers are doing in the product, not what they tell you they’re doing. Look at which pages, features, and sub-components are getting the most active usage and why. Look at the outliers and understand whether there exist some interesting additional opportunities.

3) Analyze the aggregated data to determine best practices and benchmarks across your
customers. You can actually add value to your customers businesses by making them better in your product, and your product better by watching your best customers.
The other subtlety of a service offering is that customers have to be able to use the offering in production to recognize its value, and for your business to convert CMRR to MRR and GAAP revenue.

This implementation time is measured as the time from the day you acquire a new order until the day it goes into production. You want this lag to be as short as possible, and growth in this number is a strong leading indicator of possible product and/or implementation problems. Prudent SaaS companies have made wise investments in process and technology to make this time as short as possible. These investments span the range of simple items like streamlining workflows and improving user training to fully automated self-provisioning models that allow turn ups to happen without human intervention. As a general rule, the higher your price point the lower the need for automated provisioning and the lower your price point the higher the need. A fairly typical implementation range for SMB focused SaaS providers is 0-60 days, and enterprise focused offerings typically range from 2-4 months. Although “average implementation time” is typically not a key executive metric, it should be tracked as a second level metric and promoted as a primary metric if you are out of range or the trends are inappropriate.

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Bessemer SaaS Law #8

Bessemer SaaS Law #8. Single instance, multi-tenant, single datacenter - Have only one
version of the code in production. Really. “Just say no” to on-premise deployments.

This is a guiding architectural principle for best-of-breed SaaS companies. The notion of a multi- instance, single tenant offering should only apply to legacy software companies moving to a dedicated hosting model because they don’t have the luxury of an architectural re-design. It is possible to use virtualization to provide multiple instances, but this hybrid strategy will make your engineering team much more expensive and much less nimble. If designing a SaaS product out of the gate, the best situation is single instance, multi-tenant. There are hybrid models that have worked, but in general it is a hard and fast law that should not be debated and we will leave
the hybrids to the “clean tech” entrepreneurs. The same can typically be said about a single global data center. You want to leverage your core infrastructure as much as possible, even when expanding internationally for as long as possible. You should invest early in backup and disaster recovery, but stick to one data center as long as
possible and at least past $2M CMRR. SaaS companies have this debate all the time, and yet the recent data is pretty clear: most SaaS companies can get by with a single datacenter in North America until well past their IPO. In fact, Salesforce.com is passing $1 billion in revenue and announced plans for additional datacenters only a year ago.

Data centers are extremely expensive and create significant organizational complexity on every level. Many of the historical issues around data backup, disaster recovery, and global application latency that caused companies to add a second datacenter can also now be better addressed in other ways.

With a single code base in North America, it will obviously make it much more difficult to sell a SaaS deal to foreign governments or defense departments (yet another reason why the Swiss military probably won’t be a beta customer for you!), but focus is a good thing. You still have the vast majority of the global market available to you, and the macro trends are only moving even more in your direction.

It really does add a lot of overhead cost and operational complexity that is hard to absorb unless the business is at scale…meaning typically $2M++ of CMRR. And when you do open a second facility make sure it’s funded by customers, typically as part of a broad international expansion.

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Bessemer SaaS Law #7

Bessemer SaaS Law #7. Stay local - Prove your business in North America first. Only after reaching $1M in CMRR should you consider hiring European sales and services execs
behind customer demand. Save Asia for post-IPO.

Almost all businesses will look to go global at some point if they continue to grow. But SaaS vendors face more barriers to globalization than traditional software companies because you can’t just localize the UI and ship a new CD to some remote country. Given the different architecture and high service level expectations in the SaaS industry, companies are faced with questions about latency, data access and security through replicated local datacenters, in-country customer support personnel, packaged integration with other regional software and SaaS products, and other similar issues.

Simply put, North America is a massive market with a rising tide around SaaS. There is no need to go global early and force this cost and complexity upon your organization. In most SaaS sub- markets, we find that Europe is roughly three years behind the US in adoption, and Asia is slightly behind Europe – although we have recently seen some interesting pockets of activity in Japan and India that may be accelerating. A rough rule of thumb is that you should look to pass $1M CMRR ($12M Annual Contract Value) before even considering Europe, and even then you should let customer deals pull you into the region as you incrementally hire sales and services professionals. Unless you have some extremely unfair advantage in Asia, wait until Europe is a clear home run before even considering opening up a sales war on another front. Your default position should be to consider Europe as your pre-IPO growth story, and Asia only after you’re a high-flying public company.

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Bessemer SaaS Law #6

Bessemer SaaS Law #6. By definition, your sales prospects are online - Savvy online
marketing is a core competence (sometimes the only one) of every successful SaaS business.

You sell a product that requires an internet connection and a web browser for access, which means your prospects are online! Numerous studies show that your customers are now doing most of their primary research online, and it should not surprise you. As a consumer, you wouldn’t imagine buying a car, making an offer on a home, planning a vacation, or completing other large purchases without first doing some research online. The same is now true for executives at your target customers. You should therefore be aggressive in marketing to them online.

This is a clear example where business-to-business (B2B) marketers need to learn from their business-to-consumer (B2C) counterparts. The most innovative B2C companies are lead generation machines, leveraging search engine optimization (SEO), viral marketing, Search Engine Marketing (SEM), email marketing, and other technically-advanced methods. Yet many B2B companies don’t have a clue.

The incumbent technology leaders like IBM, Oracle, or SAP, have done very little in online marketing, and thus have given their smaller challengers a huge opportunity. Private SaaS companies have so many disadvantages against the larger incumbent vendors that it is imperative for them to exploit this potential advantage. Whether they use an automated product like Eloqua (as is the case with a dozen of our companies) or a team of marketing analysts and spreadsheets, online marketing and demand generation is simply a “must have” for SaaS companies.

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Bessemer SaaS Law #5

Bessemer SaaS Law #5. SaaS is a whole new ecosystem where traditional IT channels don’t
work – Focus your business development efforts on business services channels, but you will need to sell directly for a long time as these new set of partners are not easy to ramp-up.

Unfortunately many software executives have spent years building deep relationships with executives at the major software and integration companies like IBM, Oracle, HP, and Accenture…only to find they aren’t much help to SaaS businesses. SaaS products, by their nature, do not require massive amounts of systems integration work to implement, so they’re not a great fit with the traditional system integrator (SI) business model. SaaS products don’t pull through large stacks of hardware boxes and software licenses so they’re not very attractive to traditional independent software vendor (ISV) partners either. ISVs and SIs have both spent decades building up deep relationships with the IT organizations, but many SaaS vendors now prefer to sell to line of business instead so these executive relationships are much less valuable.

Channel relationships are very hard for any small company to establish even when interests are directly aligned, but this challenge is proving even more difficult for most SaaS companies given the restricted value proposition to the SI and ISV community. Therefore, it is still the case that most SaaS businesses have to be comfortable with the fact that they will live or die by their ability to sell directly, and only if they are successful alone will they be able to build meaningful
channel relationships with the new generation of partners and resellers. In recognition of these dynamics, many of the early SaaS leaders have started to focus their business development effort on business services channels, i.e., partners that provide technology enabled or managed services to the same customer segment and can enrich their offering by adding a SaaS application. These business services channel partners range from marketingagencies to payroll providers to accounting firms and have started to understand the power of SaaS when many of the ISVs and SIs do not. However, this trend is just emerging and we have not seen any of them generating a significant portion of the SaaS company revenues, but we think this will accelerate in 2009.

In addition we have been encouraged lately by an increased partner focus among many of the early SaaS leaders (Salesforce.com, Cisco/Webex, etc…). In particular, we have seen the emergence of a new generation of smaller, more nimble and SaaS-savvy SI firms. These firms are primarily working with public SaaS vendors like Salesforce, but have started to extend their set of partnerships to late stage private companies.
This may be the Bessemer “law” that is evolving the most rapidly, and I sincerely hope that by the next update we will have numerous established channel partners that “grok” the SaaS business model and are incentivized to support SaaS vendors.

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Bessemer SaaS Law # 4

Bessemer SaaS Law # 4. Separate your “hunters” and “farmers” and pay them all on
CMRR growth. As soon as you have climbed the Sales Learning Curve and have a sizeable customer base, you should supplement your sales force with renewal-oriented account managers.

When a SaaS company starts to hit the sales inflection point, it is important to keep the new business reps (the “hunters”) busy with finding new deals, while a team of account managers (the “farmers”) tends the established customers. Both teams are critically important for the health and growth of the business because CMRR is a function of new sales net of churn from your existing accounts, so you should have dedicated experts for each of these two revenue groups as soon as is practically possible. Once a company has a few sales reps achieving quota and a significant customer base, it is time to hire dedicated account management experts who are compensated to focus exclusively on customer service, renewals, and up-sells. As all good sales VPs will tell you, the compensation plans of the sales team will drive behavior, so it is critically important that you structure the sales and account management plans to align with the key metrics of your business: CMRR, Churn, and Cash flow.

For sales, they should be paid on new CMRR with a standard deal structure (such as a one year deal, with quarterly pre- payments), and incentives for more favorable cash flow terms (such as multi-year pre-payments). The CMRR incentive should be logical, because you are paying for new business added which is similar to the traditional “bookings” comp plans. To give you a concrete example with easy math, let’s assume your enterprise sales reps are on incentive plans at $120,000 base and an additional $120,000 bonus at quota. Let’s assume their quota is $120,000 MRR. In simple terms (and simple is good for sales comp plans), the rep gets to keep every dollar of new MRR they bring in for the year – and the business gets to keep the other 59 months of revenue in a five year customer relationship. You can play with minimum thresholds ($60k MRR to be eligible for a bonus) and accelerators (you get to keep 2x the MRR for every dollar above quota), but the core idea is critical. In addition, although compensating sales reps for cash flow may seem a bit unusual, it’s actually very logical.

As a private company, you have a VERY high cost of capital (well above 10%), whether you raise venture capital, angel money, friends and family investments, bank financing, or all of the above. You are taking money from outsiders already at expensive terms, so why not get it from your customers for “free” instead? If your customers are larger than you, they likely have a relatively low cost of capital and long term budget cycles that are already accustomed to large licensed software purchases. As Board members, we would strongly encourage a company to offer a customer a 5% + price discount for a multi-year pre-payment, and we would happily give the sales rep a modest incentive for pushing this option. It can be one of the rare win-win- win (company, customer, and sales rep) situations in life!

You should think of account management as a sales function, and they should be compensated in a similar fashion – but modeled on your CMRR and churn assumptions instead of a new CMRR sales quota. Each account manager should have a portfolio of existing customers, and you should model the expected CMRR from this group net of up-sells and churn. These numbers will vary widely based on your line of business and corporate focus, but a “typical” account manager may start the year with 20 customers and a starting CMRR of $200K. Your model will suggest that they should end the year with only 18 of these customers (churn of $20k), but that the average account should grow by 15% with up-sells and additional seats (net up-sells of $180k * 15% = $27k), so their net CMRR quota might be $207k or $210k for the year. While the up-sells are equivalent to new CMRR and can be compensated at the same level, CMRR renewals are typically compensated less (we often see 1/3 of new CMRR comp).
“I like to see SaaS comp plans where the commission dollars paid are not percent based but rather directly tied to the MRR. When a customer tries to negotiate a contract from $10k to $9k MRR, the sales rep feels the pain of $1,000 out of his or her pocket, and suddenly becomes much more effective at holding prices!”
Gary Messiana, Bessemer Entrepreneur-In-Residence and former CEO, Netli

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Bessemer SaaS Law #3

Bessemer SaaS Law #3. Tune before you scale: the Sales Learning Curve is even more
critical for SaaS and it takes at least $300k MRR to climb it. Stop at three sales reps until at least two of them are making $100K MRR quotas.

Years ago Bessemer was fortunate to invest behind Mark Leslie at Veritas, and as a result our firm became big believers in a concept Mark helped pioneer around the Sales Learning Curve (SLC). The core concept is that software organizations often fail because they staff up their sales efforts too quickly and make them too large before the sales model has been refined. This concept is even more critical for SaaS businesses given the large upfront investment required to acquire customers. Ramping up too quickly will burn precious cash reserve and could sink the business.

While the CAC ratio helps SaaS businesses at scale to manage their Sales and Marketing spend,the SLC is a helpful framework for early stage businesses before you have meaningful data. To understand when the business has started to climb the sales learning curve and is in a position to hire more reps profitably, you have to think in terms of CMRR instead of bookings. You know you can profitably scale sales when a couple of sales reps are at an annualized run rate to sign annual contract values (CMRR x 12 months) equal to twice their fully-burdened cost of sales. In
this case, fully-burdened is not just the salary, bonus, and benefits of the sales rep, but also allocations for sales engineering support, executive support, marketing expense, and professional service expenses associate with securing the customer.

For a direct, enterprise sales business model, these thresholds are likely to be around $80,000-100,000 CMRR (approx. $1-1.2M annualized), and for tele-sales models, this may scale down to $60,000-75,000 MRR ($720,000-900,000 annualized). It is usually time to accelerate sales hiring when at least two out of three sales reps are hitting quotas at these numbers, and the business has achieved some scale to suggest that the processes are repeatable- at least $300,000 of CMRR. The “repeatable” aspect is critical: too often companies scale their sales force aggressively after their first senior rep is getting traction in the market and then quickly realize that the new hires struggle to sign their first deal because they don’t have three VP’s and the CEO alongside them. To then quickly quantify the total business impact from productive sales executives, you can use the “Rule of 78’s”. To use round numbers, let’s assume a salesperson sells $10K of new CMRR every month for twelve months. The new customer closed in January will then generate $120k of revenue that year (12 months x $10,000), the February deal generates $110,000, the March deal $100,000 and so on. Consistently delivering a deal per month in this progression gives you a total of 78 months of cumulative recognized revenue. The Rule of 78’s shows the first year revenue amount for such an effort (78 X $10K = $780,000). It is critical to note that unlike a traditional software company model where missed periods can be made up with a few large transactions at the end of the quarter, SaaS revenue can not be recaptured. If the salesperson delivered every month as outlined but missed just his or her January deal, $120,000 of revenue is lost forever. A lost subscription month is lost forever, and no amount of year-end heroics can recapture it. This means that revenue closed earlier in the year (or even quarter) is far more valuable than the same size deal later in the year. It is therefore critical to establish a sales compensation plan that rewards early and consistent performance. The power of SaaS is further illustrated when you realize the same 12 logos that generated $780,000 the first year will generate $1,440,000 in year two – the “Rule of 144” - assuming net neutral churn and up-sells.

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Bessemer SaaS Law #2

Bessemer SaaS Law #2. Customer Acquisition Cost (CAC) and Customer LifeTime Value
(CLTV) are the best indicators of long term value creation.

It can be argued persuasively that SaaS is a lousy business model because your costs are front-loaded and your revenue only arrives in modest monthly or annual payments. However, as we know from the cable industry, subscription businesses can be very profitable over time. The key to long term financial health is to keep customers happy so their payments keep coming, and coming, and coming…and over time add up to some really large numbers. But in this context, how do you calibrate your sales and marketing investment and how do you know if these tradeoffs make sense and are ultimately “profitable”? The answer of the first question can be found through the CAC Ratio. This single number is the key to determine your level of sales and marketing investment and is very simple to calculate by looking at a quarterly GAAP P&L: you just have to divide the annualized net gross margin added during the quarter by the sales and marketing costs of the previous quarter. CAC Ratio (Q408) = [GM(Q408)-GM(Q308)]*4 Sales & Marketing Costs (Q308) The CAC ratio determines the payback time on your sales and marketing investment: a CAC ratio of 0.5 for example means that half of your investment is paid back per year, so it is a two year payback period. So how should you use this ratio? The punch line is that a CAC ratio of a third (0.33) or less is bad – this suggests it takes you at least three years to payback your initial customer acquisition costs – so you should slam on the breaks on your sales and marketing spending until you can improve your sales efficiency. At the other end, anything above one (1) means you should invest more money immediately and step on the gas (and please call Bessemer immediately because we want to fund you!) as your customers are profitable within the first year.

To answer the second question and make sure you are building a profitable business, the key indicator to look at is the Customer LifeTime Value (CLTV). The CLTV is the net present value of the recurring profit streams of a given customer less the acquisition cost. A profitable business will have a positive CLTV. To make the calculation simple, let’s assume that a customer generates $1 of annual recurring revenue for a company with a CAC ratio of 1.0, a 70% Gross Margin and 10% each of R&D and G&A costs. The $1 of revenue will generate $0.7 of gross margin and $0.5 of profit each year ($0.7 less $0.1 of R&D and $0.1 of G&A costs). Over 5 years, this customer will generate $2.5 of profit (5 years x $0.5/year). A CAC ratio of 1.0, means a $0.7 upfront acquisition cost, making the CLTV equal to $2.5-$0.7= $1.8. This is equivalent to ($1.8/5) = $0.36 of annualized profit or 36% profit margin. The calculation can be refined with a better allocation of the S&M costs (part of them are used to support current customers) and by discounting the profit streams (in this example, a 15% discount rate would reduce the CLTV to $1.23 or 25% annualized profit margin). For young companies it may be more of an art than a science to estimate the lifetime period of the customer as your churn data is still limited, but we very conservatively take 3-4 years for SMB customers, and 5-7 years for enterprise customers.

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Bessemer SaaS Law #1

Bessemer SaaS Law #1. Your key monthly business metrics are: CMRR (Committed
Monthly Recurring Revenue), Churn, and Cash flow - “Bookings” is for suckers.

Experienced software executives have been taught for years that there is a single critical metric by which the health of a growth software business can be judged: “Bookings”. However, in the SaaS world, “Bookings” is ambiguous at best and often very misleading. A simple example would be if Customer A signs a one-year deal at $10,000 per month, and Customer B signs a three-year deal at $5,000 per month. The traditional metric of Bookings would value Customer A at $120,000 and suggest Customer B is more valuable at $180,000. This is misleading because in a recurring revenue model, Customer A is much more valuable to the business (assuming typical churn rates) as they will likely generate $360,000 of revenue for the business with renewals over that same three year period.

To achieve better business visibility, most SaaS companies focus on Monthly Recurring Revenue (MRR) – which is the combined value of all of the current recurring subscription revenue - instead of Bookings. We recommend companies actually take this a step further and keep a forward view of Committed Monthly Recurring Revenue (CMRR). The CMRR differs from the MRR from two standpoints: firstly, it includes both “in production” recurring revenues of customer and also those with signed contracts going into production. Secondly it is reduced by “churn” which is the MRR expected to be lost from customers that have announced they will stop the service. This metric is the single most important metric for a SaaS business to monitor as the change in CMRR provides the clearest visibility into the health of any SaaS business. For a more detailed explanation of CMRR and how it’s calculated, you can signup to receive David Cowan’s whitepaper Measuring Growth Businesses with Recurring Revenues at www.bvp.com/saas or send an email to saasvc@bvp.com.

If you calculate CMRR correctly, that single metric also gives you good forward visibility into, revenue, cash collections and Churn. SaaS executives need to track churn in detail from a “logos lost” (lost customers) perspective as well as the amount of lost CMRR. It’s very difficult and expensive to grow subscription businesses if you have moderate customer churn, and prohibitive if your churn is high. Whereas the largest legacy enterprise software companies literally made hundreds of millions of dollars over the last decade with “shelf-ware” projects that never got fully implemented, project failure is not an option for SaaS businesses or the customer will simply turn you off, regardless of your contract terms. The top performing SaaS companies typically achieve annual customer renewal rates above 90% - with most of the churn due to death (bankruptcies) or marriage (acquisitions) - and over 100% renewals on a dollar value basis due to up-sells into this installed base.

Cashflow is the other key metric. To be fair, visibility into the current cash position and the change in the cash position has always been important for software executives, but is even more critical for SaaS businesses because the working capital requirements are higher and the payment terms are often stretched out over the term of the contract. Given the high cost of capital for private SaaS companies, wise executives will often offer slight MRR discounts to customers in exchange for quarterly or annual pre-payment terms, and provide incentives for their sales force accordingly.

Many of our top performing SaaS CEOs will orient their entire executive team objectives and bonus plans around these three metrics exclusively, because almost every other key success factor for the business is embodied in CMRR growth, Churn, or Cashflow.

Full Index

Bessemer Top Ten Saasy Laws

I'm republishing Bessemer Venture Partners Top Ten Laws For Being SaaS-y PDF Whitepaper - because the content is too good to be locked up in a proprietary file format :)

Here is the Index:

  1. Your key monthly business metrics are: CMRR (Committed Monthly Recurring Revenue), Churn, and Cash flow - “Bookings” is for suckers
  2. Customer Acquisition Cost (CAC) and Customer LifeTime Value (CLTV) are the best indicators of long term value creation
  3. Tune before you scale: the Sales Learning Curve is even more critical for SaaS and it takes at least $300k MRR to climb it. Stop at three sales reps until at least two of them are making $100K MRR quotas
  4. Separate your “hunters” and “farmers” and pay them all on CMRR growth
  5. SaaS is a whole new ecosystem where traditional IT channels don’t work – Focus your business development efforts on business services channels, but you will need to sell directly for a long time as these new set of partners are not easy to ramp-up
  6. By definition, your sales prospects are online - Savvy online marketing is a core competence (sometimes the only one) of every successful SaaS business
  7. Stay local - Prove your business in North America first. Only after reaching $1M in CMRR should you consider hiring European sales and services execs behind customer demand. Save Asia for post-IPO
  8. Single instance, multi-tenant, single datacenter - Have only one version of the code in production. Really. “Just say no” to on-premise deployments
  9. The most important part of Software-as-a-Service isn’t “Software” it’s “Service”!
  10. Be prepared to cross the desert - SaaS requires R&D and sales expense up front for a multi-year stream of revenue, so it demands enough investment capital to fund 4+ years of runway. Load up for the long trip and pace your consumption of calories!

Wednesday, October 15, 2008

Cohorts Retention Churn ARPU



Just wrote a relatively long winded post on the blist blog - also supported with graphics - on cohort analysis, churn, user retention, and ARPU

Thursday, October 9, 2008

Cut Copy Lights & Music Showbox Seattle

Really impressed by Australian electronic dance band Cut Copy at the Showbox on Wednesday night - they have a pitch perfect 80s new wave sound that is simultaneously unique and original - and they make the crowd bounce. Here is a video from the show of their song Lights & Music: http://www.youtube.com/watch?v=VNU-6NkVfrE

Monday, October 6, 2008

Den Bla Avis, eBay, Illiterate Usability


eBay bought dba.dk for some ducats today - and I was reminded of a sterling little usability Maoism/litmus test: I used dba.dk to search for an apartment in Copenhagen, and I speak zero Danish - yet I was still able to figure things out. So here goes: design websites/apps intuitively enough that an illiterate can figure it out. That way you will serve not only people who cannot read, but also the schizophrenic skimmers who choose not to read - at Startonomics last week, social media gate-keeper Muhammed Saleem surface a statistic that normal people read about 240 words per minute, while active consumers of social media 'read' about 900 wpm.

Wednesday, October 1, 2008

Startonomics

Startonomics

I will be at Startonomics in San Francisco tomorrow - smart people, good time, concise schedule.

Tuesday, September 30, 2008

Hillel - JacksonFish - Calacanis

Hillel Cooperman of Jackson Fish Market has a great post up about startup work efficiency that is semi-in response to Jason Calacanis's note about startups during hard times - so go read Hillel's post.

Wednesday, September 24, 2008

A Demon Of Our Own Design - Bookstaber

I am currently reading A Demon Of Our Own Design: Markets, Hedge Funds, and the Perils of Financial Innovation by Richard Bookstaber.

I've read just about everything that is even moderately available to the public about quantitative finance and this sort of thing over the years, and so far I definitely recommend this book. That would be Icarus & Daedalus on the cover:

Wednesday, September 17, 2008

IntVen Myhrvold Patent Consortia

Good WSJ article and derivative TC article about IntVen - Nathan Myhrvold's Intellectual Ventures raising and returning some serious money.

People have been knee-jerking like crazy over this - but as someone with more than a passing knowledge of intellectual property and patent licensing - I want to say this:

This isn’t that crazy or diabolical - big companies have been creating cross-licensing consortia for years that lets them interact in the marketplace and get things done - like sell DVD players that depend on a whole bunch of different patents held by different companies - intven is the same model but organized in a more ongoing vehicle way rather than one project at a time.

Sunday, September 14, 2008

The Sounds Get Geico Payoff - Plus Cavemen

One of my favorite Swedish Bands - The Sounds - just got a nice payday from Geico for providing 'Hurt You' as the soundtrack for the new Geico Motorcycle Cavemen ad - Nice work!

http://www.youtube.com/watch?v=mwWfU18boOI

Why Gnip Will Displace Google

Whether search is 90% solved or whether the last 10% will take 90% of the effort, - either or both according to Marissa Meyer - there is a lot of improvement to be had in search. If you honestly want to find authoritative information about a topic that’s been over-SEOed like ‘ring tones’ or ‘mortgages’ – or you’re searching for a semantically challenging term like ‘bush’ - or you’re looking for something particularly esoteric – Google leaves you with a lot of cruft to wade through.

Particularly in technology and the Internet – there is no such thing as a permanent monopoly – eventually someone will challenge Google in core search and start taking their market share.
It sure won’t be Cuil – now that they are in self-destruct mode. It won’t be Powerset now that their assets have been assimilated. But it just may be GnipEric Marcoullier’s ping server to rule them all. In this recent interview with Om Malik, Eric humbly calls Gnip’s service ‘commodity work’ that takes away some logistical headaches for web service developers. But what Gnip is really doing is fundamentally changing the nature of aggregation and indexing on the web from a pull model to a push model.

Search engines today send out spiders to actively crawl the web and pull content into the index – at so great a cost in overhead that crawling is generally considered to be a powerful barrier to entry in the search market.

Contrastingly, if you subscribe to a blog, you get pushed a notification whenever that blog is updated – with a push model, there is no need to scan through every blog you like to read to find out which ones have been updated as a spider would. This push model provides enough of an advantage that webmasters will use Google Adwords & Adsense as a way to ping Google and get new content or sites indexed more quickly than simply waiting for the spider.

This is not a new idea – back in the circa 2000 era, visionary Seattle startup 360powered had the same idea – and even managed to perfect an interesting patent enumerating this architecture. Unfortunately, 360powered fell victim to the dot com crash and their IP ended up auctioned off in bankruptcy.

In a Gnip world, every website would have a feed – whenever content changes – the index gets pinged. Simultaneously, the overhead of crawling is distributed out to the edge, removing the burden from the search engine, and the delay for new content to get indexed goes to zero.
Gnip is nothing less than a fundamental cornerstone of the next generation of dominant search.

Thursday, September 11, 2008

Not Sure What To Think

One of my oldest friends just had a baby - and this is one of the first photos - honestly I'm not really sure what to think:

Wednesday, September 10, 2008

Creative Accounting: Einhorn Greenlight Lehman

Creative accounting rulez - reading a regular stream of items like this maintains a healthy level of skepticism about conventional wisdom:

"Lehman was taking advantage of a new accounting mechanism that allowed it to book revenue based on the declining value of its own debts. In other words, because of the increasingly risky state of Lehman, loans that other firms had made to Lehman had dropped in value, and under the new accounting, Lehman could count this as a gain."

Relatedly, this is a great article about David Einhorn and Greenlight Capital.

Tuesday, September 9, 2008

Mid-East Roadmap To Success

All you got do to is:

"Americans might better understand the region, experts here said, if they simply listen to what people are saying — and try to understand why — rather than taking offense. The broad view here is that even before Sept. 11, the United States was not a fair broker in the Arab-Israeli conflict, and that it then capitalized on the attacks to buttress Israel and undermine the Muslim Arab world."
-Memo from Cairo

This is excellent reporting by the NYT, go read the full article, and very much in line with my own experiences talking to Cairenes.

Friday, August 29, 2008

Classy Ad, RWW



Not an ideal brand fit - I'm not saying it's not remunerative, just takes away from the sterling RWW brand.

Wednesday, August 27, 2008

Icahn - Great Proxy Analogy

"An apt analogy would be a situation where a store manager raids the cash register and uses those funds to hire security guards to prevent the store's owner from entering the store to make suggestions on how the store is run."
- 3 Senseless Steps in A Proxy Contest

Tuesday, August 26, 2008

Denver, Democrats, and Protests.




Denver, Democrats, and Protests.
"Where is the America I love?"

Fantastic photo from fantastic site: Daylife - with traction.

Sunday, August 24, 2008

Seven Tips From Ben Straley - Reachmachines

My smart friend Ben Straley, founder of Reachmachines just coalesced 7 great points to address slash questions to answer up front as an entrepreneur - none of these are big secrets - just a nice list of the puzzle pieces you want in order to start a successful business:

  1. Find a partner you trust. Someone with complementary skills and experience that you like and know will be honest and upfront about their goals and level of commitment. It’s more fun that way and your odds of success will be exponentially greater.
  2. Clearly define roles and responsibilities of everyone involved on a day-to-day basis with the business BEFORE you determine ownership structure. For an early-stage business, this issue is of paramount importance. It’s the key to ensuring everyone’s incentives are aligned for the longterm.
  3. Have a clear idea of your target market. I don’t mean this in the strategic sense. I mean it in the sense that you need to have 5 (or more) individuals/companies in mind that you KNOW would be eager to pay for your service. Find them and talk to them.
  4. Have a good idea of how you will make money. In my experience, pricing model, price point, etc. can and should be somewhat flexible. Regardless of the model and price(s) you arrive at over time, you need to know you can charge something for it and enough to generate meaningful returns in a relatively short period of time.
  5. Think through your exit. Don’t build the business with an exit in mind but at the same time understand there will likely be one. This will also inform your financing plan. When you’ve thought through #2 and #3, the you’ll have a good idea if you’re building a $10M business or a $1B business. The former is interesting to a lot of angels while the latter is interesting to angels AND VCs. The sooner you know which of these two paths you’re heading down, the closer you’ll be to raising the funds necessary to grow the business.
  6. If you need to, raise a relatively small amount of money from family and friends. People that know you personally and believe in YOU. Use this money to prove the concept.
  7. Unless you’re within 90 days of a larger financing round (term sheet(s) on the horizon), do not mess around with convertible debt. A series A (preferred) is the better way to go.

Friday, August 22, 2008

Dear Washington DC Reader

Dear Washington DC reader - email me, we should be friends:

Thursday, August 21, 2008

Jason Calacanis on PR

I saw this first on Hacker News - so it's not like I'm finding a diamond in the rough here, but Jason Calacanis on developing & getting PR is fantastic

The 80-100 Rule

Everybody's heard of the 80/20 rule - and similarly, the 80/20 rule manifests itself everywhere.

My contribution is the 80/100 rule, namely, it's better to do a 100% job on the 80% solution than an 80% job on the 100% solution.

Tim Egan On The Republican Party

"And what nearly two-out-of-every-three Americans concluded in the last four years -– based on disapproval ratings -– was that Republicans could not govern at a national level.

They lost a city, in New Orleans, a budget surplus by pandering to lobbyist-greased congressional leaders, and world standing by waging a war that may end up as the most costly and longest in our history.

Their moral strutting proved as thin as the claim to fiscal responsibility. Down the road, in Colorado Springs, a minister who bragged that he had the White House on speed dial was brought down by a male prostitute and meth."

-Tim Egan in the NYT

Tuesday, August 19, 2008

Nelson Mandela - Early Internet Radio

Great story from a friend over IM today:

"So we had obtained all the global rights to the South African Broadcasting System via Q's friendship with Nelson Mandela, and we were the first guys to stream live radio over the web in the very first days of "Real Networks" (we put a boom box radio in a sound proof box and a high quality microphone connected to a sound blaster card in a PC, connected to a moden, connected to our hosting servers to get the radio signals on to the web!"

Monday, August 18, 2008

Forget People Who Dont Like You

In a reflective moment, my frequently wise, 17 year old brother told me that he thought life was much too short to waste time on people who didn’t like him. The same is true when you’re building and providing a web application. It’s generally accepted that you should design for yourself before you start designing for other people, but as an extension – don’t waste time on people who aren’t going to like you anyway. There are a couple of good posts floating around this week on this topic:

“I think the best brands, the best sites have a large portion of their founders personality in them. Never be afraid to be yourself, after all there are 1/2 billion people on the www, not all of them have to agree with you. Concentrate on the ones that share your views, concentrate on making their experience the very best it can be, the rest forget them.”
-SEObook

“Faced with the excitement of making a CD and all the knobs and dials, they overproduced the record. They went from being two real guys playing authentic music, live and for free, and became a multi-tracked quartet in search of a professional sound. And they ended up in the dead zone. Not enough gloss to be slick, too much to be real.”
- Seth Godin

Here’s the correct progression:
  1. Build a product that you yourself love to use – if you can’t convince yourself, how can you convince anyone else?
  2. Delight the people who already give you the benefit of the doubt. Believe it or not, there are people who will invest an inordinate amount of time in your application and excuse all kinds of foibles – worry about these people, they are the ones who will churn out over time if you don’t serve them well enough, not the ones who abandon right off the bat – it’s too hard to convince abandoners anyway.
  3. When you’re creating value and inculcating loyalty, then go ahead and aggressively open the floodgates.

Amadou And Miriam



I went to see Amadou & Miriam, the married, blind, musical geniuses from Mali with LL a couple of years ago in Seattle - this was probably the best concert I have ever been to - they make & enjoy such beautiful music together - here is a great Amadou & Miriam playlist that you can stream from imeem - if you can't see the player click through here:

Amadou & Miriam

Thursday, August 14, 2008

Google: Black Ink Within 24 Months! (1999)

This is a great Forbes article from 1999. You could practically run the same article today with regards to semantics and natural language.

This bit would work less well though:

"If all goes according to plan, Google should be in the black in less than 24 months. If Page and Brin pull it off, now that will be some story to tell."

Old, speculative articles like this one give great perspective on the speculative articles of today.

Ad Of The Day: The Navy SEAL Of Book Publicists


Ad Of The Day: The Navy SEAL Of Book Publicists

Wednesday, August 13, 2008

Seattle Concert Listings in blist

You can scroll through or search for Seattle concert listings through the end of 2008 here. You can see band pictures, click through to their myspace page or listen on imeem:


Seattle-WA-Concerts

Powered by blist

Monday, August 11, 2008

SEOmoz Top 100 Sites In Situ



Powered by blist

Wednesday, July 23, 2008

21, MIT, Kate Bosworth, Torrent, aXXo



21 just came out of DVD, and I saw it for the first time. Pretty fun. Among other things, 21 features Kate Bosworth as a hot chick from MIT who changes her name ;)

In addition to DVD, 21 may or may not also be available, here.

Monday, July 21, 2008

Apes & Androids - Siren08 Afterparty


By lucky coincidence - I went to this Apes & Androids concert and it kicked ass.

Thursday, July 17, 2008

Johnossi - All They Ever Wanted - New Album

Johnossi has a new album coming out in Sweden called All They Ever Wanted. The first 2 songs (18 Karat Gold, and Party With My Pain) on the myspace player are insane - Johnossi will get huge with this album - huge - swear to god!

18 Karat Gold



Party With My Pain

It Is Keyword Time Again

Here are some of the most recent keywords that Mattishness readers come in through:

faacebook
mattishness
20 seconds of joy dvd
how to visit cuba
italian postal bonds
positronic seattle
shiftboard
orolix
tsa spot
viral loop

Wednesday, July 16, 2008

A little bit too nice

Seattle Startup: Gathering 6/17 @ Owl and Thistle

Savan & I & other startup friends are meeting this Thursday at 6pm at Owl & Thistle in Pioneer Square to talk shop - hope you can join us.

Thursday, July 10, 2008

New blist tagcloud


blist now has a tag cloud on the dashboard to help you visualize what's going on in the community better. For the moment you'll need to be logged in to see/use it.

Click here to check it out.

Tuesday, July 8, 2008

Ahmed Rashid - Descent Into Chaos


I'm currently reading Ahmed Rashid's new book Descent into Chaos: The United States and the Failure of Nation building in Pakistan, Afghanistan, and Central Asia.

Monday, July 7, 2008

Crawlable SWF Questions



My top three unanswered questions about Googlebot crawling through SWFs on the blist blog.

Seattle Startups: RIPL Resurfaces


I wrote about RIPL back in April 2007 - since then they've been very quiet - as is common, they have been doing a certain amount of poking around trying to find the right business model, team, technology, and marketing strategy. Well, today RIPL resurfaced for me - just a little with this email. Watching with interest.

Was ist das Blinkenlights?


Was ist das Blinkenlights?

Thursday, July 3, 2008

Adobe Flash SEO & Monkey Magic

Yelp API, Compete.com, Quantcast


Yelp is doing well, but not as well as Compete.com would have you believe. In fact, this might be the single biggest Compete.com fail I have observed. In most cases, Compete tends to quite accurate - and a good way to estimate traffic to third party websites - but in the case of Yelp, they are wildly off. Quantcast, Alexa, and various anecdotal sources peg Yelp traffic at a healthy ~3.5M monthly uniques - nowhere close to the ~15M shown by Compete. Compete uses a mixture of data from toolbars, panels, and ISP log samples to compute their traffic estimates. Yelp has an API - what Compete seems to have managed to do is pull their ISP data sample from directly between Yelp and a large consumer of the Yelp API. 'ISP data' always sounds very robust compared to an audience panel or toolbar data - but it's important to remember that it's only a sample - not a 'full set' of ISP data - and is just as susceptible to sample bias as data collected any other way.

Tuesday, July 1, 2008

Sunday, June 29, 2008

GOOG MSFT Dare Obasanjo

Really interesting post by Dare Obasanjo trolling through a few comparisons of organization, process, hiring, and culture at Google and Microsoft:

TheGOOGMSFTExodus

Three Kings Spam & Bonus Movie Trailer



Three Kings Trailer

Three Kings is one of my favorite movies - certainly the crowning achievement of David O Russell's moribund-ish career; today I got a new spam email reminiscent of that film's plot - this is actually an entertaining read:

DEAR FRIEND I NEED YOUR ASSISTANCE.

My name is sgt martins scott, I am an American soldier with Swiss background, serving in the military with the army's 3rd infantry division. With a very desperate need for assistance, I have summed up courage to contact you. I found your contact particulars in an address journal. I am seeking your kind assistance to move the sum of ( $ 25 million u.s. dollars ) Twenty Five million united states dollars to you, as far as I can be assured that my share will be safe in your care until I complete my service here, this is no stolen money, and there are no danger involved.

Source of money:

Some money in various currencies was discovered in barrels at a farmhouse near one of Saddam's old palaces in Tikrit-Iraq during a rescue operation, and it was agreed by staff Sgt Kenneth buff and I that some part of this money be shared among both of us before informing anybody about it since both of us saw the money first. This was quite an illegal thing to do, but I tell you what? No compensation can make up for the risk we have taken with our lives in this hell hole. Of which my brother in-law was killed by a road side bomb last week. You will find the story of this money on the web address below;

http://news.bbc.co.uk/2/hi/middle_east/2988455.stm

The above figure was given to me as my share, and to conceal this kind of money became a problem for me, so with the help of a British contact working here and his office enjoy some immunity, I was able to get the package out to a safe location entirely out of trouble spot. He does not know the real contents of the package, and believes that it belongs to a brithish/american medical doctor who died in a raid here in Iraq, and before giving up, trusted me to hand over the package to his family in united states.I have now found a much secured way of getting the package out of Iraq to your country for you to pick up, and I will discuss this with you when I am sure that you are willing to assist me. I want you to tell me how much you will take from this money for the assistance you will give to me.

One passionate appeal I will make to you is not to discuss this matter with anybody, should you have reasons to reject this offer, please and please destroy this message as any leakage of this information will be too bad for us soldier's here in Iraq. I do not know how long we will remain here, and i have been shot, wounded and survived two suicide bomb attacks by the special grace of god, this and other reasons i will mention later has prompted me to reach out for help, i honestly want this matter to be resolved immediately, please contact me as soon as possible my only way of communication is email.Indicate your interest in assisting me as well as Providing the following information to facilitate the smooth conclusion of the Transaction.

Wedding Season

Friday, June 27, 2008

Startup Valuation Via Brad Feld

Brad's 1,2,3 . . . description of valuing startups is particularly clear and succinct:

  1. Value your investments at your cost.
  2. If a financing happens at an increased valuation and is led by a new investor, write your investment up to the new price per share.
  3. If a financing happens at a decreased valuation regardless of whether or not there is a new investor, write your investment down to the new price per share.
  4. If bad things are happening, you can take a discretionary write down based on your best judgement.
  5. If good things are happening, you should not take a discretionary write up. Only write things up in case #2.
  6. If the company is public, use the publicly traded price but discount it due to illiquidity (usually 25%).

Thursday, June 26, 2008

Seattle - Land of Dueling Bumper Stickers



The Logic Behind Landmark SCOTUS Decisions



"Silent on central questions of gun control for two centuries, the Supreme Court found its voice Thursday in a decision affirming the right to have guns for self-defense in the home and addressing a constitutional riddle almost as old as the republic over what it means to say the people may keep and bear arms." (More than 12 words from the AP)

Here is the kind of off-the-cuff pseudo-logic exercised by Antonin Scalia in formulating the majority opinion - I mean, honestly?:

"Scalia noted that the handgun is Americans' preferred weapon of self-defense in part because "it can be pointed at a burglar with one hand while the other hand dials the police."

From the AP

Wednesday, June 25, 2008

Telemark Skiing In June


In uphill mode - the 'earning' part of 'earn your turns' - low down on Mount Adams this past weekend.

Mount Adams Very Early At Lunch Counter



Mount Adams
- dawn-ish - at circa 9,000 feet.

Friday, June 20, 2008

Wetpaint, Weebly, Mahalo - blist blog



Wetpaint is a good place to easily create a free website - I have a new post on the blist blog expanding on this thought - go read it.

Wednesday, June 18, 2008

Take That, Scientists!



From the Seattletimes

This is a great example of what I call 'Republican Logic'.

Oh, and this is an AP story - so I posted the image of text rather than the text itself b/c the AP doesn't have OCR software scanning for re-posts. If they did, they'd try to charge me like $12 or something.

Monday, June 16, 2008

About Half The Stuff I Did This Weekend

Milk&Honey
Betrayed
Noguchi
Bulgarian
Tia Pol's
Shakeshack

Mostly courtesy of A-Lo

Danger Mouse & Jemini

Before Gnarls Barkley, before the Grey Album there was Ghetto Pop Life a collaboration between DM & Jemini:

Danger Mouse & Jemini

Thursday, June 12, 2008

Enterprise 2.0: Incentivizing Adoption



Great quote from CIA guys at Enterprise 2.0 answering a question from a self-described 'middle-manager' on how to coax employees to adopt new products and tools:

CIA: incentivize employee adoption of e2.0 with "dinner tokens, lanyards & trinkets - people like that."

Then they made a second and better point: replace existing business processes - don't just pile on additional requirements and processes.

Friday, June 6, 2008

Internet Pharma Riches Here I Come!

ads in rias - blist blog

I have a new post up on the blist blog about advertising within Flash/Flex applications - particularly advertising in RIAs:

Advertising in RIAs

Savan & Me Haz Facebook Group

We've got some cool folks on board - you can read more on savanrith.com

ReadWriteWeb - Iceberg - Repost

Iceberg, an app builder, got some nice coverage in RWW yesterday - I wrote a comment that's worth a repost:

Iceberg is a good product in a hard space - app builders are trying to get traction with an audience who don't think about investing time upfront to 'create an application' but rather want to start solving their data organization problem right away. It's hard to cross this chasm and make it easy enough to appeal to this audience, but flexible enough to create compelling apps or appeal to more technical users. There's a continuum of different product categories aimed at 'making it easier to program' - from frameworks like Rails to intermediate products like Thermo or Popfly to end-user products like Iceberg - some categories won't be able to escape the 'not flexible enough for technical people, and not easy enough for non-technical people' trap.

Mathew
http://www.blist.com