We're excited to announce our partnership with and investment in Kustomer. Kustomer is a New York City-based company building the next-generation of customer support platform.
2018 is a blockbuster year for software M&A multiples. The prices companies fetch relative to their revenues surpass any of those in the past 7 years. Billion-dollar plus acquisitions in 2018 have commanded 17x trailing enterprise value to revenue multiple. Nothing in the past seven years is close. In fact, there is noqt a single acquisition in that range.
Last week, Microsoft acquired Github for $7.5B. It's a massive acquisition at a massive price relative to other software acquisitions. Why is Microsoft willing to pay so much?
You've just raised a round of financing. Your next step is to build your management team. There are several criteria for finding the right executive. Competency in the field, cultural fit, communication skills, management experience. All of those should be obvious. There is one that is often overlooked. Network.
Imagine you came across this ad. Scientists have discovered a revolutionary new treatment that makes you live longer. It enhances your memory and makes you more creative. It makes you look more attractive. It keeps you slim and lowers food cravings. It protects you from cancer and dementia. It wards off colds and the flu. It lowers your risk of heart attacks and stroke, not to mention diabetes. You’ll even feel happier, less depressed, and less anxious. Are you interested?
Technology innovations swing to a pendulum's cadence. Sometimes innovations begin with infrastructure changes and reverberate up the stack. Other times, front-end engineers innovate at the application layer, which demand downstream changes in the infrastructure to scale. The last major epoch of front end evolution has celebrated its ten year anniversary. We're in a period of punctuated equilibrium. When will we see rapid speciation?
I remember the first time I wrote an OKR (objective and key result) at Google. "You should set your goals so that you attain 70%. That's success," my manager told me. "Even better if you have a moonshot goal in there, with a 5% likelihood of success." I was uneasy with calling 70% goal achievement as success. The habits formed from 17 years of schooling and a 100 point scale run deep.
At Redpoint's annual investor meeting earlier this year, I quipped, "The day-trading taxi drivers of the dotcom era have been replaced by crypto-trading Uber drivers." But over the weekend, a grizzled Uber driver with a mane of grey hair and wind-and-sunburnt cheeks asked me about crypto. "Can you explain to me why public key/private key technology is important on the Blockchain?" He pointed out the Bitcoin ATM that charges 10% from his cigarette-infused Prius. "That's for suckers; Coinbase charges only 2%," he said as we whizzed past.
There’s the challenge of dealing with uncertainty, where you’re operating in the weird zone that you’re making decisions that have significant long term impact or that are difficult to reverse or course-correct in the face of great uncertainty.