I'm a partner at Redpoint. I write daily, data-driven blog posts about key questions facing startups. I co-authored the book, Winning with Data. Join more than 20,000 others receiving these blog posts by email.

How Competition Strengthens Startups

In HBR this month, two British researchers reported on their study of the impact of competition on startups. In a study of over 2M companies spanning 10 years, the researchers determined that if a startup faced competition in its first year, it was more likely to fail. But if the startup survived its first year, it’s survival rate jumped nearly 30%.

This data screams survivorship bias. Of course the startups who navigate hostile waters deftly in their first year will have a higher likelihood of ...

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Salesforce’s Disruptor Won’t Be A CRM Company

For sales people, social proof is one of the most powerful forms of influence, as Robert Ciadini proved in his seminal book on the topic. It’s no secret that the best leads are referrals. Second best is the friend who is a customer in common: “Oh, Peter chose Salesforce for his CRM. Maybe I should consider them too.” Social proof confers the trust of a relationship to the salesperson improving close rates.

But social proof is entirely absent from sales software. Salesforce which generates $3B in ...

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Incremental Innovation is Just As Powerful as Disruption

Peter Thiel and Gary Kasparov wrote in the Financial Times about “Our dangerous illusion of tech progress”. The main point of the article is quoted below:

[We are living in an era of] cautiousness far too satisfied with incremental improvements. Our ability to do basic things such as protect ourselves from earthquakes and hurricanes, to travel and to extend our lifespans is barely increasing [since the 1960s]. The genuine progress in IT from the 1970s up to the 2000s masked the relative stagnation of ...

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There’s A 10x Hidden In That Tweet

On a Saturday morning in August of 2006, Sergey Brin and a team of Googlers flew to Los Angeles to meet Tom Anderson and his MySpace team. By the next afternoon, the two founders shook hands on a three year $900M contract. About twelve months later, I found myself as the product manager for the team in Marrakesh, Google’s executive board room, reporting the state of affairs to Eric, Larry and Sergey.

After signing the letter of intent, Google assembled a superb five-person team of ...

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The Voice of the People is Data

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If you’re a Netflix subscriber, in all likelihood you’re a big fan of “House of Cards.” Netflix designed it that way.

With the release of “House of Cards” Netflix began the Moneyball-era of content production. The majority of Netflix subscribers watch Kevin Spacey, political thrillers and David Fincher’s movies. Guess what? “House of Cards” has all three.

In baseball, on-base percentage is the best predictive metric for team success. In content production, the best predictor is user viewership behavior.

Because of Netflix’s ...

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Why Humility is Essential for Every New Startup Hire

When interviewing product managers at Google, we ranked candidates on four metrics: technical ability, communication skills, intellect and Googliness. A Googley person embodies the values of the company - a willingness to help others, an upbeat attitude, a passion for the company, and the most important, humility.

In the past week, I asked two heads of engineering to identify the most important characteristic in new hires. Both responded, “humility”. For one startup ascertaining humility is so important, it is the first ...

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Freemium Businesses Switch the Hunter and Farmer Sales Roles

Kenny Van Zant is a marketing wizard. Before his current role at Asana, Kenny managed products and marketing for Solarwinds, a publicly traded company that sells networking equipment to the mid-market. Solarwinds pioneered the low-friction, high-velocity sales model in their segment to great success.

SolarWinds offered free products to their customers to gain usage data that informs their sales and marketing efforts. As one might expect, inside sales reps would call upon the most likely customers to up-sell them to paid. And of course, SolarWinds employed the enterprise ...

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The Religious Debate About Data

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David Brooks has a great op-ed this morning on the Philosophy of Data. He argues that data offers one major advantage and one major drawback. Data enables humans to discover patterns otherwise unobservable by our senses/intuition or patterns that violate human intuition. But the religion of data engenders a fallacy: that everything can and should be measured; and with this data, the best answer will emerge.

Belief in the power of data has become a sort of religious debate which has manifested itself in ...

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Valuations in the Series A and Series B Market are Booming

With a litany of articles in recent months highlighting the number of companies with valuations greater than $1B, I’ve started to wonder about the valuation trends for the highest profile venture backed companies.

Venture capitalists are increasing market prices in Series A and Series B rounds aggressively in effort to reap disproportionate returns. And the variances in the prices of different startups in these early rounds is enormous, indicating a relatively inelastic market. Investors are chasing fast-growth startups irrespective of the price.

I gathered data on 77 ...

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How to Optimize Every Decision in Your Life and Accomplish Nothing

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Even the greatest minds fear missing out. Nobel laureate Richard Feynman who assisted in the development of the atomic bomb, contributed substantial advances to quantum mechanics and particle physics, discovered the cause of the Challenger Shuttle disaster and popularized science as a witty and successful author, faced this fear when confronted with a menu.

How many different dishes should he order from a menu before settling upon a favorite? Feynman used probability theory to solve the problem. Below is the formula he developed with ...

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