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Building Fat Startups: Delphix CEO Jedidiah Yueh (Part 5)

Posted on Friday, Sep 14th 2018

Sramana Mitra: You don’t have a Steve Wozniak that you’re paired up with throughout your journey?

Jedidiah Yueh: I had co-founders who were technical. Co-founders come at different levels. Some of them didn’t stay with the companies. I always found technical co-founders’ help.

Sramana Mitra: It’s more incidental and not a soulmate kind of relationship.

Jedidiah Yueh: I wouldn’t call them incidental.

Sramana Mitra: Let’s go to the Delphix journey. By this point, you had money of your own. How did you get this off the ground? Did you put in some of your own money to do a prototype? What was the journey?

Jedidiah Yueh: After I left EMC, I thought about bootstrapping it. I talked to a couple of developers who wanted to help me build the product. I also talked to a couple of VCs that I knew well after the Avamar journey. They basically said to me, “Why bother bootstrapping it? You can just raise the round now.” I ended up just raising the money from VCs out of the gate.

Sramana Mitra: How much did you raise?

Jedidiah Yueh: I raised $8 million.

Sramana Mitra: How long did it take you to get the product out?

Jedidiah Yueh: We shipped the product in less than a year.

Sramana Mitra: Were customers part of your development process? By this time in the history of Silicon Valley, it’s fairly well-understood that customers need to be part of the product development process early on. Were you mirroring that trend?

Jedidiah Yueh: I’m not a subscriber to the lean startup methodology or the customer development methodology. They actually mislead a lot of entrepreneurs in many ways. I think what you want to do is iterate and really want to refine products inside the mind of a disciplined entrepreneur. It’s much cheaper that way.

I don’t think you want to try and delegate out customer interactions. If you have to iterate, you should. All that being said, I had a lot of customers at Avamar. I had a lot of relationships with executives. We talked to a lot of them as we were building the product. We had them provide feedback throughout that lifecycle.

One of the funny things with Delphix is when we first launched the product, I used to believe in the old crossing the chasm framework. Many of our first customers were large enterprises who were risk-averse. It was stubbornly horizontal even though we tried to focus on verticals.

Sramana Mitra: Your products are all infrastructure products. Geoffrey Moore’s philosophy is a little bit less pertinent to product areas that are pure horizontal product areas. Your products are enterprise horizontal software. The vertical philosophy applies less to your type of company.

Jedidiah Yueh: I would agree with that. Our very first customer was a Fortune 100 company. The CIO ended up deploying us at Facebook. He was a CIO at Facebook. The very first company that deployed and paid for the product was Staples. They were pretty large organizations. The turning factor was how much they had in data delivery for their key applications. The more pain they had, the more opportunity we had.

This segment is part 5 in the series : Building Fat Startups: Delphix CEO Jedidiah Yueh
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