Afterword

Afterword Founder Lessons from the Salesforce Incubator By Mike Kreaden Mike has developed and managed both incarnations of the Salesforce Incubator — The AppExchange Incubator from 2006-2008, and is currently the Managing Director (Executive in Residence) of The Incubator at Salesforce. Mike’s focus is to coach startups on building great enterprise SaaS products and companies, by tapping into his 15 years of experience at Salesforce. This brings to a close over two years of discussions with some really smart SaaS entrepreneurs, founders, VCs, and thought leaders with vast experience in the enterprise SaaS arena. It’s been fun to sit down and talk with people who are willing to share their experiences and wisdom. The purpose of writing these two volumes of “The SaaS Fo unders Guide” was to share these learnings with as many SaaS startup founders and startup fans, as possible. My intention was to provide SaaS founders with the necessary background and insights into what it takes to build a successful SaaS company. By no means is this project complete, but I am satisﬁed that we have shared both the conceptual and tactical plays that will help you think like a successful SaaS business founder, and not just focus on your product or service. Salesforce was the ﬁrst enterprise SaaS company to put customer success as value number one. Every successful SaaS company has replicated this call to action . We have all become customer obsessed, out of the necessity dictated by the SaaS business model. This is good for customers, and good for the industry as a whole. I have been fortunate to work with hundreds of startups over the years and, of late, have been given the opportunity to manage our 111111

AfterAwfterordword latestlatest startup startup initiativ initiative, thee ,Incubator the Incubator at Salesforc at Salesforce. As eI . writeAs I write this, we this, we are aboutare about halfway halfway through through our inaugural our inaugural cohort. cohort. We have We have 14 startups 14 startups and andone oneEntrepreneur Entrepreneur in R esidencein Residence working working on ideas,on ideas, products, products, and andtechnologies technologies that thathave have the potentialthe potential to be to game-changers be game-changers for for enterpriseenterprise customers. customers. All are All early are early stage stage (pre–initial (pre–initial traction), traction), but some but some alreadyalready have have great great customer customer traction traction with with100+ 100+ customers customers onboarded. onboarded. I thoughtI thought I would I would ask some ask some of the of founders the founders in our in cohort our cohort to provide to provide somesome insights insights on lessons on lessons learned learned along along their theirstartup startup journe journey. Fory some . For some of them,of them, this is this not is just not wisdom just wisdom gained gained in the in past the fewpast months few months but from but from prior startups and in the longer journey from concept to prior startups and in the longer journey from concept to execution.execution. Ray Hein, Co-foundeRay Hein, Co-founder, Propelr, Propel HavinHavig “beeng n“bee aronu narod theund b theloc k”blo ac fek”w a tifemwe s,ti mI es, I characchterizearacterize three three comb cineombd inearedas a reforas fo forun derfouns ders to fotocu sfo ocun:s Toenam: T-Ceamultu-Creu,lt uProre,du Proct-Mduact-Mrketa, ranketd , and ChanCnhel-Coannel-Commummunity. Allnit yof. All the ofse the needse n toeed ha tove hsuavef su- f - ﬁcienﬁtc foiecusnt fo acusnd inveand sinvetmesnttm ine nort diner or tod erb utoild b au ilsud ca su- c - cessful cescsompful canompy. any. Team-CultureTeam-Culture It’s harIt’sd harto dﬁn tod aﬁ ngred aa tgre staartt uspta rtteuamp te thamat cthaant gelcan qui gelc klquiy. cAkl byig. A par bigt part of thatof isthat hiring is hiring people people who wcahon dceaanl dweithal wtheith inthehere innheret chnatlle cnhgealles nogef s of sacriﬁcesacriﬁce and ancommitd commitmentm neeentd neeed dine dthe in ethearly esatartrly usptart phupas eph. Evease.n Even if youif’ve yo uw’veork wedor togetherked together at other at other medi mumedi orum la rgeor l acrgeom pcanomieps,an thiee s, the demademnds aarend svery are diﬀerevery diﬀerent in na ts tina rta uspta. rtLifeup .go Lifeals, go perals,so pernals goonaalls, go analds, a and a sharedshared visio nvisio set nthe set bas theeli basne eliforn ethe for e thearly etearlyam te. Aams yo. Aus groyouw gro, it’sw ver, it’y s very importimportant toa mnt aintto maaintin theain the visio n and vision and purpopsuerpo. se. TodayT,oda transy, traparensncparey andncy trust and trustare k eyare fo kundaey foundationatiol elenaml eleentms toen buts toild buil-d - ing a ilenga ran leingar ncuingltu creu ltthature perforthat performs wmsell togethewell together. I liker. Ito li ksae yto th saayt buthailtd buil-d - ing ai ngreatg a great com pcoanmyp isan liyk eis takiliken takig sandng sandand turandn inturg niti ningto it ain gltoas as gl aasrt s art piecepie. It ctae.k Ite sta fokecus,s fo skillcus,, skilland, aa ndlot aof lot en ofergy en ergyand heandat heto asth toape sh aanped and moldmol thed gl theass gl. Ifas dos. nIfe do wnelle, wyoellu, wyoillu c wreillate cre soatem ethisomnethig manggi macal githcaatl athll at all will trewill treasurea.sure. 112112 112112

Founder Founder LessoLness fromsons from the S thealesforce Salesforce IncubIncubator ator Product-MarketProduct-Market KnowKingnow yoingur yomaurrk maet arnketd co anmdpetitio competition reanlly re wellally iswell the is ﬁr thest tip ﬁrs It w tipou I lwd ould oﬀer oﬀerup. It u’sp so. It e’sas soy etoas developy to develop apps appin thes in clou thed clou thesed these days dathayst Ith thiatn Ik think a lot aof lot en oftrepre entrepreneursn eursjust jujumstp ju inm wp ithoin wuithot thinkingut thinking enough enough abou abt thoue t the businesbusiness mods elmso anddels pandain sp theyains ’theyre add’reressi addnressig. Asn gsu. Asch ,su theych, theyget dow get n down the ptheath pwaithoth wuithot thinkiut thinking abnogu abt theout cothemm coercimmalizerciationaliza ationnd maandrk maetinrkg eting aspecastspe anctsd howand howmuc hm mucoreh m tioreme ,ti andme, mandone my,one theyy, ’theyll nee’lld n aftereed afterthey they get their get their app caopp mpletecompleted. d. Channel-CommunityChannel-Community PeoplePeople talk atalkbo uat bearly-out early-stages tcompaage companies nlearniies learning frongm frotheirm theirearly early adoptersadopters and lockiand nlockig inn gtheir in theirprod ucprodt-mucart-kmet arﬁt.ket C ertﬁt. aCinertly,a thatinly, thatis ste ip s step one. Io’dn ea.rg I’du ea,rg houwe, evehowr, evethatr, dthateﬁn dineﬁg nyoinugr yochaunnr chael snntrategel strategy, inclyud, ininclgud an ing an ecosyesctemosy softem part ofn parters, nisers an, importais an important waynt tow aytur toboch turbargeoch yoargeur yobusuiner busss. iness. AgainAgai, earlyn, earlyon, anon entreprene, an entrepreneur’s fourcus’s fo ocusn the on prodthe ucprodt aucndt aa ndstro an sg trong channchael nncanel also can helpalso helpvalid atevali dtheirate theirprod ucprodt-mucart-mket aﬁtrk etfro ﬁtm frotheirm theirinsight ins sights and eanxperied experience, atnc timee, at s timefasters f asthatern thaa cusn tomera customer base wbasille s whoillw s yohouw. you. LastlyL,a wstlhey, nw Ihe thinkn I think of co ofmm coummnityu, itn’its yyour, it’s yourwhole whole team te’s anetm’ws netorkw anorkd and the abtheility ab toility lever to leverage thoagese tho consen conectionnections alongs a thelong wa they. Swatartupsy. Startups are h aarred hard work,w noork, d ounob dt.ou Expbta. nExpdingan dyouring yournetw norketw thoughork though man yman pathsy p, ainthsclud, ininclg uding particpipartiaticnipga intin ag w inell-ru a well-run incunb inactorub orator acc oreler accaelertor progrator program, willam, i mwillprov ime prove your yoprourbab proilitybab ofility su ofcces sus.c cesDos.n ’tD beon ’at frbeai da frtoa itda pto o tna pm oann ym folankys folalonks g along the wathey a wandy le aanrnd le froarnm frotheirm theirexperien experiences. Mostces. Most people people will go w illout go of out thei ofr their way tow ayhelp to youhelp in you way ins w yoayus ca yonu’t caiman’tgi imane.gi If nyoue. If h youave nh’atve ﬁguren’t ﬁgure it out it yet out, yet, beingb eingan en antrepre entrepreneur,n runeurn, irunng nai nstga rtua stpa, rtualongp, a longwith wtheith od theds od ofd fas ilofur fe ailure versusver sususcce sussc, cemassk,e ma youke the you e xtheact e dxeﬁactn ditioneﬁn itionof an of un adner udnogder. dAognd. mAnosdt most peoplepeople will a wlwaill ysalwa root for theys root for the under undog to derdog to win. win. 113113 113113

AfterAwfterordword Tzachi Benayoun, CEO and FoundeTzachi Benayoun, CEO and Founder, r, Bud MobileBud Mobile Our kOurey prin keyc priniple cofiple ex eofcutio execnutio is probn is abprobly nabotly to n otas k to ask wherewhere the worl thed worl is goid ins ggoi, ratherng, rather where w herecan it c bane tita bkeen t. aken. In praIncti prace,c staytice ,clear stay clearof inc ofre imncerentmalisenm.ta lisDrem.am Dre faamr int fao r into the futurethe future and wandork w baorkck wabacrdkwa to rsusd tota susin at aloinn ager-ter longer-term m roadmap of iroadmap of innovnanovtion aand tion opportand opportunityun. ity. Will Dinkel, Will Dinkel, CEO and Co-foundeCEO and Co-founder, Novar, Nova My adMyvi cade viforce SaforaS SafouaSnd fouersnd cerans bcane bbroek ebn roken downd ointown the follointo the followingw 1ing0 poi 10 ntpois: nts: 1. Surro1. Suurrond uyourselfnd yourself with wbrilliantith brilliant people. people. Preferabl Preferably y brilliabnrilliat peoplent people with relevwith anrelevt knowledgeant knowledge and skills, and skills, and who and valwhoue value their theirtime tiasm mue acsh mu as cyouh as d youo. This do .is This a very is a appealingvery appealing aspect aspect of the of the SalesSforalecesfor Incceu bIncatorub —ator everyo — everyone onn ethe on Salesforcethe Salesforce team team is ver isy very capabcaple, abknowledgeablele, knowledgeable abou at the ibout the industry,ndustry, and has and has experie experienced nced hypergrowthhypergrowth. . 2. Expect2. Expect that thatit may it maytake takeﬁve toﬁve seven to seven years years to ﬁnd to successﬁnd success as as a founder.a founder. Becoming Becoming a successful a successful founder founder requires requires skills skillsand and experienceexperience that canthat only can beonly acquired be acquired on the on job. the Giving job. Giving up early up early is theis best the andbest only and wayonly toway ensure to ensure you walk you walkaway away worse worse oﬀ than oﬀ than you started.you started. 3. Once3. Once you youget pastget pastthe startingthe starting hurdle — initial hurdle — initial fundraising fundraising or or customercustomer traction, traction, for example — building for example — building a startup a startup is like is any like any otherother job. It’s job. all It’s about all about working working hard, hard, making making thoughtful thoughtful decisions, decisions, showingshowing up day up in day and in day and out, day andout, doing and doing that consistentlythat consistently over over a long period of time.a long period of time. 4. Building4. Building a comp a company ians ay siserie a ss erieof ss taofges st,a geseac,h eoacnhe hoanvie nhga via ng a single,single, concrete concrete, and ,tr andackable trackable succe sssucc meetriss mc. etriForc the. For Sa theles Saforlece sforce IncubatorIncubator, we have, we havea con acrete concrete, linea, rli linseta ofr li mstile ofs mtoneiless.tone If yous. If d youon’t don’t knowkno yourw your curre cnurret stagent s tageor m etrior mc, etriﬁguc, reﬁg itu oreu tit b oeforeut before all el asell. else. 114114 114114

Founder Founder LessoLness fromsons from the S thealesforce Salesforce IncubIncubator ator 5. Raising5. Raising money money does does not equal not equal success. success. Fundraising Fundraising has never has never “made” a startup, but it has certainly doomed a great number.“made” a startup, but it has certainly doomed a great number. 6. Choose6. Choose co-founders co-founders you youenjoy enjoy as human as human beings. beings. You’ll You’ll be be spendingspending a lot aof lot time of timewith withyour yourco-founders; co-founders; they theyshould should be be people who energize you.people who energize you. 7. Rew7. aRewrd thoardu ghtfthouughtflnesus lnanedss eﬀortand eﬀort over overresult res. suInlt sstartup. In startups, returs, nreturs ns are luarempy lu mpyand progreand progress is hardss is hardto see to. Its’see ea. Its’sy, eahowever,sy, however, to as k to ask yourselfyourself “Did I“Did spe nI sdpe today nd today as proas duproctivelyductively as po asss ible?poss”ible?” 8. Change8. Change in the in world the world happens happens when when you act you on act yourself, on yourself, and that and that manifestsmanifests around around you. Ergo,you. Ergo, to change to change the world, the world, strive strive daily dailyfor for greatergreater levels levels of discipline, of discipline, skill, endurance,skill, endurance, and health. and health. You are You are the asset that makes a one-year-old company worth millions.the asset that makes a one-year-old company worth millions. 9. Take9. Takecare careof yourself. of yourself. Sleep Sleep well, well,eat well. eat well.If you If needyou need to take to take a walka walkor run or in run the in middle the middle of the of day, the doday, it. do It’s it. okay, It’s okay, and often and often necessary,necessary, to spend to spend a Saturday a Saturday in bed in watchingbed watching Netﬂix. Netﬂix. You’re You’re trying to win a war, not a battle.trying to win a war, not a battle. 10. Have10. Have fun. Creatingfun. Creating a successful a successful company company is just is onejust aspectone aspect of of the greater goal: to live a happy, exciting, and fulﬁlling life.the greater goal: to live a happy, exciting, and fulﬁlling life. KG Charles-Harris, CEO, QuarrioKG Charles-Harris, CEO, Quarrio AfterA stfterarting sta rtingand buanildd buingil dﬁveing buﬁvesi nbuessesins,esse the s, the one thingone thing that stthaant dsst aonudst to ou mt eto i sm hoe wis hotrulyw trulydiﬃ di- ﬃ - cult itc ultis. Thit ias.t ’sTh wahyt’s wgoohyd goo advid sadors,vi swhoors, whocan helcanp help you avoidyou avoid mist amkesist aaknesd caanptd ucreapt opportunitiesure opportunities, are , are betterb etterthan thgoland. golThed. bTheetter b etteryour ayourdvisors advisors are, the are m, theore more they theyinvolve involve them theselvemselves in yos inur yobuusrines buss,ines thes, d theeeper deeper their theirknow klendogwe ledge of yoofur yochuarlle chngealles,n agends, theand m theore m theyore theylever leverage theirage theircont acoctn ntaetctw noretkws, orks, the higher yothe higher your likelihoour likelihood of sud ofcce sussc. cess. So howSo howdo yo dou ﬁyondu aﬁndnd leverand aleverge advisorage advisors? Bottoms? Bottom line, liknneow, k nthaowt that it takites ta ak lotes aof lot work of work to ﬁn tod qﬁnualityd qu aalitydvis aordvis ansords gaiandn gaivalune val fromue fromthem the. m. WhenW heit ncome it comes to sﬁ ntodi nﬁgn diandvig saordvis, sthereors, there is n oi s sunbos titsuubtestit forute dforee p deep researrecshear ancdh eaxtendns exteivens netivew norkietwnorkig. An goodg. A good advis aindvig relatiosing relationshipns iship tru liy s truly a mean tormesnhiptor sehipxperie experience. Itnc’se d. eeplyIt’s deeply pers opernals oannald developsand develops over overtime . time. It’s a Itch’s aalle chngealle tonge both to boththe advithe sadvior ansord theand athedvi saeedvi tosee b eto reve be areveling aling 115115 115115

AfterAwfterordword and vanulnerad vulnerable, wbhilele, w athile the at s theame s amtimee tidmisplayie disnplayig conngﬁ dcoennﬁced,e sntrcaetegi, strac tegic acumenacumen, and, aannd abilityan a bilityto ex toec utexee. cutBute. thButat ’sth wathat’s w’s hatrequire’s required frodm from both bpothartie psa.rties. How Hodow you do getyou valueget value from fro thesem these relationship relationships? First,s? First, it’s abou it’s about t commcounmimcationunication — en — esuringnsuring that yourthat youradvisor advisor is aware is aware of present of present sta st- a - tus, dtuessire, deds fireutdu refu tsutatree s, tatande, theand path the pathyou’ve you’ve designed designed to get to ther get ether. e. This iThiss tru ies trbothue b inoth ter inm ters ofm thes of larger the larger direction direction of the of co them pancomypan, buyt , but also ainls oregard in regard to tacti to ctactial decisionscal decisions and, aocnd,casionall occasionally, they, day-tothe day-to- - day mdainy umtiaineu. tiae. SecondSecond, you, musyou tmus ask tfor as kw forhat w yohatu wanyou twan, whitc, hw hiinc mh anin ym waanysy wa is thys e is the mostmost diﬃc diﬃcult asupectlt as pectof the of relatiothe relationshipns. Ihit reqp. Itu irereqs uaire lots aof lot tho ofu ghttho utghto to understaunderstand bothnd bwhothat wh youat d yoesuire d efrosirem frothem in thedivi induadivil aduadvils aordvi andsor w andhat w’s hat’s reasonreaableson toable as kto of a sthek ofm. the Sincm.e S peopleince people func tiofuncn dtioiﬀeren diﬀerently, therently, there is no is no standardstan dardguid eguibookdeb forook ho forw hoto win terto ainctter. Paercts.o Pnaerllsoy,na I wllyork, I w aorkt develo at develop -p - ing ai deeperng a deeper know knoledgewle ofdge m yof me mny tormesn’ vetorsste’ ved isntetered insterets andsts ego ands, ego and s, and work withwork with those tho thisnegs thi tongs form to a dformeeper a deeper relatio relnsatiohipns. hip. ValuinValuig ann gad avins aord’vis stimeor’s timeis ess iesn etissael. nTtiradal.itio Tradnaitiolly,na goodlly, good advis adorsvi arsore s are busy busypeople people who whoare de areali ndega wlinithg wlotiths oflot pres ofssu preressu anred lotansd oflot peopls of people e comingcoming at the atm the fromm froeverym every angl ean. Bgleeca. uBseeca ofus etho ofs etho cirscue mcirscutancmsetsanc, es, whenwheevern everyou engyoua engge wageith wanith ad anvis ador,vi its’so re, ssit’esn etissael ntoti adlo to so d wo ithso wopeithn open heartheart and minandd min, andd, aan wdilli an wgnillienssg ntoe shsa tove hyoaveur yoassuur mptioassumptions andns sandtrat stra-t - egiesegies challe challenged.n geThid.s iThis diﬃs iscu diﬃlt forcu lte nfortrepre entrepreneurs,n easur ms, ostas m ofost us ofha uvse have strongstrong convictio convictions andns aand bit aof b sitt ubof borstubnnboressnn. Howeveess. However, withor, wuithot doiunt g doing the htheard hwaorkrd w ofork allo ofw ainllogw youring syourelf toself be to ch baelle cnhgedallen ogedn a odneeper a deeper level , level, you’llyou end’ll up end w upasti wngasti theng valu theab valule tiabmlee tianmde e anxperiend experience of cyoe uofr yoaduvirs adorsvi, sors, which iswhi csomethih is something yonu sg yoimplyu simply can’t ca aﬀorn’t ad toﬀor ddo to. do. Deepa Subramanian, CEO, Deepa Subramanian, CEO, WootricWootric You shouldYou should only ronlyaise rmaiosen eymo froneym froinvems itornves swtorho s who will bweill h bared hoanrd yo oun ayondu aholndd holyoud acyocou unaccotabunle table in goodin good times ti, mbesut, willbut bwillat forba tyo foru wheyou nwhe thinn gthis ngs inevitainevitably gobly w goron wg.ro Mnang. yM fouanynd fouersnd thiernsk thi a bnrkand a b-rand- namen aimnvestore investor is a llis yo aull yoneeud n eeor, dw oorsr, ew, orsthate, thatall all 116116 116116

Founder Founder LessoLness fromsons from the S thealesforce Salesforce IncubIncubator ator investinmvestentm mentoney money is goo isd goo modn emy. oChooney. Choose wisseely w: iYsouely : are eYou nare eterinng intterino g into a long-tera long-term relmatio relnashiption thshipat requires that requires a lot of trusta lot of trust and c aonmd procommproise.mise. Gil Allouche, FoundeGil Allouche, Founder, Metadatar, Metadata A comAmo comn momisnta mikes thattake e thatntrepre entrepreneursn neeeursd n toee avoid tod avoid is buildiis bnuildig a nprodg a ucprodt inuc at s inilo a a sndilo laandunc lhiaunncg hiit ntoog it lat tooe. late. SalesSforalecesfor inspiresce inspires us to us thi tonk thi abonku at botheu tc theustomer customer ﬁrst ﬁrst and baunildd b everythiuild everything fronmg frothamt perthastpe perctivspee.c Btiveien. gB eia ncugs a c-us - tomer-ﬁrsttomer-ﬁrst comp canomy pisann’ty jisusnt’ ta j usslogt aan slog foran us for— us we— sh waere s hoaurer our visionvi asniodn a aren dtra arens ptraarensnpta withrent owithur cus outomerr customers. In rets. Iunr nret, theyurn, helpthey uhelps us shape theshape the comp caompny, theany pro, thed uproct,d auncdt, our and fo ourcus fotocus ﬁt tothe ﬁt m theark met awrkeet’re w ine.’re in. Carter Carter Wigell, CEO, IdeatorWigell, CEO, Ideator It’s noIt’s secretno secret tha t thaa t maa joritymajority of stofartup stas rtups don’td oman’tk ema it.k eIt ’sit .criti It’sca critil toca havel to havea gam a eg amplane . plan. EntrepreneEntrepreneurs fauilr ws fhenail w theyhen theydon’ tdo haven’t havea pla na plwitanh with metricmsetric to su ntoder usntderands tawnhered w herethey theyneed n toeed c orrecto correct t their theirtrajector trajectory. They .w Theinn werins anreer sthe are one thes onewhos wundhoerst undanerstd and what wnheeat dns to eedbs to e achievebe achieved to get tod to get to the n the ext levelnext .level. Kris Moyse, Co-foundeKris Moyse, Co-founder, r, Proximity InsightProximity Insight ThereThere is a seis caret se notcret manotny ma entrepreneursny entrepreneurs like tlio ke to talk abtalkout ab —out it’ —s h itard’s !h 92%ard! 92%of st aofrtup stasrtup fail si nfa theil in ﬁrsthet ﬁrst threethree years, ye aanrds, out and of out the of re themai renmingai n8%ing th 8%at sthucact eesudc, ceed, I wouI lwd oestiuldma estitema 99%te 99%have hhaadve dhaadys dwhenays when they theythin k think they’rethey’re goin ggoi to fnga ilto f. ail. 117117 117117

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