If you haven’t already, please study our Bootstrapping Course and Investor Introductions page. This story traces the mechanics of scaling an enterprise software company that is close to $100 million in bookings in 2014, and is contemplating an IPO soon. Sramana: Fred, let’s start out this story by learning a bit more about you. What is your backstory? Fred Laluyaux:
Sramana Mitra: What was your original estimate of the TAM for your application in the financial services area? As the market was shifting, what did you estimate it down to that made you explore other verticals? Brad Peters: The TAM for each application was probably $100 million. It had to be $100 million to get
Sramana: What has your overall financing strategy been for the business? I know you raised $1.3 million in your early angel rounds. Have you raised additional funds? Rajiv Kumar: We raised $8 million dollars during our first Series A, and this past fall, we did a $5 million Series B. Sramana: Where are you in
Sramana Mitra: Was the seed that you got enough to get you to the next milestone or did you have to raise? Brad Peters: We raised seed financing before we started. We couldn’t afford to make the mortgage payment without a little bit of seed financing. We got a little bit of seed financing from
Sramana: Was the transition process contentious or was it something that happened naturally? Rajiv Kumar: It was not contentious, although it was not easy. Change is hard, but it felt like the right thing to do. The ideas I was presenting and my evangelism were compelling. It took some planning, but I was impressed with
Sramana Mitra: What did you do in 2005 when you started this company? Brad Peters: We needed to do two things. We had to get some funding because we didn’t have personal savings to be able to survive very long. We needed some seed capital. We spent a lot of time thinking through markets where,
Sramana: What were some of the interesting challenges you faced when raising VC money? Rajiv Kumar: What Brad and I decided to do while we were raising our venture round was to return to school and get our medical degrees. We felt that we should be able to do that and have a growing, successful
Sramana Mitra: You were at Siebel through that acquisition? Brad Peters: No, I wasn’t. You could see the writing on the wall. Analytics was exploding. We were doing really well, but the rest of the company was not doing so well. It was actually shrinking. You could tell that the company was on a collision