on Tomasz Tunguz

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Yearning for the Vast and Endless Sea

“My goal is to make you love rowing.” That’s how my first rowing started. I had never picked up an oar or stepped into a racing shell before. With …

Western Massachusetts

Ten Year's Worth of Learnings About Pricing

Last week, I shared a presentation with an executive team at a large public SaaS company on everything I’ve learned about pricing. Here’s a summary …

Prices

An Era of Fundamental and Massive Change - The Capital Markets Innovation of the ICO

In December 2017, the amount raised in ICOs nearly equaled the amount raised by Series A investments globally. The technology innovation catalyzed by …

Venture Capital

7 Predictions for SaaS in 2018

Below are 7 predictions about the startup software ecosystem. How many of them do you agree with?• The tax holiday for repatriation creates one of the …

SaaS

Jettisoning the Assumptions of Last Year

There’s a crisis in the scientific academic world. It’s called the Replication Crisis. Scientists have found that they cannot replicate the results …

Clayton Christensen

Premoney vs Postmoney - Which is a Better Technique for Negotiating?

When negotiating your next fundraising round, should you talk valuation in premoney terms or postmoney terms? Premoney is the valuation before the …

Meetings Shouldn't Be Boring

A friend suggested that I read the Five Dysfunctions of a Team over the weekend. Though I’m passionate about business books, I rolled my eyes. I had …

Managers Must be Insane to Brainstorm in Groups

“Evidence from science suggests that business people must be insane to use brainstorming groups.” That’s a shocking statement. Adrian Furnham, a …

How Quickly Does Headcount Scale in the Fastest Growing Software Businesses?

How quickly do the fastest growing software companies build their teams? The answer is incredibly quickly. In fact, this data bolsters the notion …

The Parallel Between Cryptocurrency and Continentals

There’s a parallel between cryptoassets today and the British colonial period predating the US. In the late-1600s, colonies began to print their own …

An Antifragile Thanksgiving

I’m grateful for all the entrepreneurs who have spent time teaching me how to build their companies. Over these past few days, I have been reading …

False Competition - Why Defining Axes of Competition Matters

In the eleventh episode of Masters of Scale, Reid Hoffman interviews Peter Thiel. The episode revolves around the idea that to truly succeed, a …

Disagree and Commit - A Management Principle for Highly Functioning Teams

Disagree and commit. I first read about this idea in the 2016 Amazon Shareholders letter. But the idea can be traced back to Andy Grove at Intel. …

Leadership

The False Confidence of the LTV/CAC Ratio for Early Stage SaaS Startups

Founders often describe their unit economics in terms of their LTV/CAC ratio - the ratio of the Lifetime Value (LTV) of a customer to the Cost of …

SaaS

The Latent Purchasing Power in the SaaS Acquisition Market

The startup acquisition market is off by roughly 35% year-over-year. Why the decline? One consistent response from potential acquirers is that they …

Just How Disruptive Are ICOs to the Classic VC Model?

Initial Coin Offerings, a fundraising mechanism for companies using cryptocurrencies as a mechanism to buy their service, seem to be upending the …

The Implication of Secular Increases in SaaS CAC

One of the major trends facing SaaS companies today is the rising cost of customer acquisition. Data on this trend has been difficult to find. …

Important Changes in Revenue and Profitability Definitions for SaaS Companies

Starting in January, public software companies will report their financials using ASC 606. Normally, accounting changes are not that interesting, but …

SaaS

The Rising Stakes in SaaS

Last week, I participated in two discussions about the changes in the SaaS world. I believe they are fundamental. The most important force shaping …

SaaS

How to Decide With Speed and Conviction

A startup’s competitive advantage is execution speed. That quickness stems from a CEO’s ability to decide and this ability separates the great from …

Ray Dalio

Monte Carlo Simulations of Inside and Outside Sales Teams in a SaaS Startup

Recently, a VP of sales told me about the way he views the dynamic between inside and outside sales. Inside sales is the drumbeat, a highly …

SaaS

Shopify S-1 Analysis - Smiling All the Way to $10B

Shopify is an exceptional business. There are not many software companies who can nearly quadruple their enterprise value in two years. But Shopify …

SaaS

Decision-Making Auditing

How do you help someone when that person knows substantially more about the question than you do? This is one of the most fundamental and frequent …

Management

How Much Should A SaaS Startup Invest in Sales & Marketing?

How much should a SaaS startup invest in sales and marketing at different stages of the business? This is a very nuanced question, but benchmarks do …

SaaS

Ownership - A Defining Trait of a Leader

One of the hardest things for me is to admit is when I’m wrong. It’s hard first to admit it to myself. But harder yet is to admit the error to …

Leadership

Should You Consider Emotional Intelligence When Hiring Your Startup's Team?

How important is hiring for emotional intelligence? EQ or EI was introduced in 1964 by Michael Beldoch and popularized by Daniel Goleman in 1995. I …

The Challenges of the Platform Go To Market

One of the most difficult go-to-market strategies for startups is platform. Platform go to markets mean selling software that can do many things, …

Marketing

The Theory and Data Underpinning Sales Commission Plans

Every startup’s sales commission plan is different. But it’s key to understand the theory and the benchmark data that governs the creation of sales …

SaaS

Hiring for a Discipline You Know Little About

Your startup is growing. You suspect you have initial product market fit. Time to hire the first head of each department. Sales, marketing, customer …

Maximizing Productivity on My Commute

I commuted to my first job on a bicycle. With my parent’s help, I bought a lemon yellow second-hand road bike that I pedaled 20 miles each way from …