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Just 25 months ago, Aileen Lee coined the term unicorn in her post Welcome to the Unicorn Club and last week the Economist declared these Unicorns “Gored.” Over the span of those two years, the Unicorn press cycle has swung from euphoric apotheosis to bleak nadir.

The rise and fall of unicorns in the press isn’t a unique phenomenon.

A company’s narrative moves like a clock: it starts at midnight, ticking off the hours. The tone and sentiment about how a business is doing move from positive (sunrise, midday) to negative (dusk, darkness). And often the story returns to midnight, rebirth and a new day…

In 2015, startups benefitted from a vibrant fund raising market. In 2016, I believe they will enjoy a very active acquisition environment. The roughly 60 or so publicly traded software companies hold more than $380B in cash and short term investments on their balance sheets. Though Microsoft, Google, Cisco and Oracle possess 75% of that cash, 14 other companies have cash reserves of greater than $500M.

It’s the end of the year, time for performance reviews, self-reflection, and planning for next year. In addition to preparing our goals for our teams and our businesses, we should prepare goals for ourselves. Oftentimes, it’s easy to let the company’s ambitions drive our OKRs. But there’s something more to consider.

In 1999, Peter Drucker, the greatest management thinker of the twentieth century, wrote short book called Managing Oneself. In it, he stresses a critical idea:

On December 2, SaaS Office Hours at Redpoint will welcome Maia Josebachvilli, VP of Strategy and People at Greenhouse, a fast growing recruiting software company. Before Greenhouse, Maia founded Urban Escapes, a DC-based startup she sold to LivingSocial. Maia is especially well known for her thought leadership in developing best in class recruiting metrics. She was also selected for Inc’s 30 under 30.

Last night, SaaS Office Hours hosted Optimizely co-founder and CTO Pete Koomen. Pete was a Google Associate Product Manager for AdSense and launched Google App Engine. Then he joined his co-founder, Dan Siroker, also an APM at Google to found three companies, the last of which is Optimizely.

As Pete shared with us, the idea of Optimizely was borne from a need Dan saw when managing the teams to build Obama’s fundraising websites during his first campaign. Dan and his team wrote code to fine-tune sign-up flows, and the experiments meaningfully improved fundraising performance. During YCombinator, after Pete and Dan had been accepted with a different ecommerce idea, that the two founders jettisoned the first idea and instead pursued the website optimization concept. Famously, they tested the idea by calling two advertising agencies and asking them to pay $1000 a month for early access to a product that didn’t yet exist (but soon would). Now 400 people strong, Optimizely is the leader in A/B Testing.

In 76 years, the British cycling team have recorded only one gold medal. In 2002, pushed by new head coach named Sir Dave Brailsford, the team implemented philosophy of continuous incremental improvement. And the results were astounding.

In the last two Summer Olympics, the British cycling team has won seven of a possible 10 gold medals at each event, a remarkable transformation. But, it wasn’t a 1% improvement on any arbitrary metric. Rather, the team identified the top factors performance, and focused on single-digit improvements in those. There were three: strategy, human performance, and continuous improvement. and the team spent years refining strategy unique to each race, optimizing the diet and training of each athlete, and experimenting, experimenting, experimenting.

As the temperament of the fundraising market shifts, particularly in the later stages, the question of how much a startup should burn will become increasingly important. We’re living in a historic period of very inexpensive venture capital. These cheap dollars have fueled spectacular companies with record-setting growth rates. In such an environment, growth at almost any cost is handsomely rewarded. But we’re observing the ecosystem starting a correction - particularly in the late stage of the market. And so burn rates will matter more and efficient growth will be prized again.

Founded in 2002, the Australian software maker Atlassian is an exceptional company in many regards. But foremost, Atlassian is one of the best examples of flywheel SaaS companies yet. Atlassian counts 1600 employees and sells five products JIRA (bug tracking software), Confluence (project management), HipChat (internal chat/collaboration), BitBucket (code repository) and JIRA Service Desk (help desk software. Yesterday, Atlassian filed their F-1, a document preceding their IPO, and revealed how efficient a software company they have built. In 2015, the company will generate $320M in revenue.

In the last 22 months, there have been 4 $1B+ software IPOs and 3 $1B+ software acquisitions. But compared to 2014, 2015 was a meager year for startups looking to go public or be acquired. The chart above plots the M&A activity over this period.

The M&A market halved in activity. In 2014, $11B of disclosed M&A occurred. I’m excluding take-private transactions of public companies like SAP/Concur, Bain/BlueCoat, Oracle/Responsys, etc. Through November 1st 2015, transaction values dipped 40% to $6.8B. The number of transactions has also nearly half from 38 to 17. However, in 2015 the median acquisition was worth $410M, compared to $193M in 2014, indicating that buyers are not buying as frequently, but when they are, they spend more.

On November 18, SaaS Office Hours at Redpoint will welcome Pete Koomen, Co-Founder and CTO of Optimizely, the incredibly fast growing AB testing and personalization company Pete founded with Dan Siroker. Numbering more than 400 people, Optimizely has built an amazing business since 2009, serving thousands of customers. Before Optimizely, Pete was a product manager at Google building Google App Engine which grew to support 150,000 developers. Before App Engine, Pete worked in the AdSense team and managed the OKR process at Google.