SELLING IN GLOBAL MARKETS

BV Jagadeesh

KAAJ Ventures

“Entrepreneur’s Trusted Partner”

ISSUES DISCUSSED Building Great companies

Product – Market Fit

Positioning

Winning Early Customers

Building Early Sales teams

Marketing

Geographies

Funding and Valuations

SELL SELL SELL

DREAM OF AN ENTREPRENEUR

PERSONALITY AND WINNING

People Network

STEP BY STEP START-UP BUILDING

Initial Validation

Customer Feedback

Pitch to Investors

Build the product or

service

Beta Test with

Customers

List Early Adapters

Sales and Mktg

Strategy

Grow BusinessCycle Repeats. New

Products, expanded mkts etc.

BUILDING A GREAT COMPANY …

Identification of problem and ability to solve

Eco-system – Investors, Mentors and others

Market adoption / Execution

Build reliable and cost effective product

4 Key Pillars of a start-up success

EARLY STAGE DESIRED TEAM LEADERS

• CEO

• CTO

• Product Mgmt

• Engineering

• Business Development / Sales

• Marketing

ROLES OF EARLY TEAM MEMBERS

• CEO:

1. Great execution, understand market, optimist + realist

2. Ability to attract talent,

3. Go in front of customers, Early stage validation, First sales

person for the company

4. Delegate, Lead team, Honest, Strong values

5. RAISE MONEY

• CTO:

1. Market vision + customer needs

2. Competition

3. Technology differential

ROLES OF EARLY TEAM MEMBERS

• Product Management

1. Clearly define market segments, identify targets

2. Understand key features per target segment

3. Work with Engineering to commit + deliver product/s that generates revenue upon FCS

One of the most critical positions in a start-up company.

ROLES OF EARLY TEAM MEMBERS

• Engineering

1. Building world-class team

2. Work closely with CEO/CTO/PM + customers to properly architect /design/ deliver quality product in timely manner

3. Work with field to quickly turn around + enhance product to close sales

ROLES OF EARLY TEAM MEMBERS

• Business Development / Sales

• Identify initial customers per direction of CTO/CEO/PM

• Help bring first 10-15 customers

• Constant Interface between Customer and Company

• Feedback on Pricing and Product Features and Quality

• Get PO’s from these early customers.

EARLY STAGE DESIRED TEAM MEMBERS

• Hard to build a team with all needed functions 1st few months

• Founding team needs to wear multiple hats…depending on expertise + background.

e.g. Founding Team A – Sales + Eng’g background

Sales: CEO, BD, fundraising

Engineering: CTO, Prod Mgmt, help CEO in funding

e.g. Founding Team B – Eng’g + Prod Mgmt Background

Prod Mgmt: BD, PM, fundraising, acting CEO

Engineering: CTO, Eng’g

Hiring Someone

1. Just because you know them

2. To “help them out”

3. As partner because you can’t afford them

4. To do a bit of everything

5. Top-down vs. bottom-up

6. Not knowing what jobs you want the person for

7. For the job you hate

Pitfalls to Avoid when Building a Talented Team

HIRING TIPS

Do’s

1. Build your company brand

2. Get concerned people involvement in hiring process

3. Recruit constantly

4. Do things professionally

5. Focus on personality + cultural fit

6. Take fast action when hiring mistake is made

Don’t

1. Don't oversell stock options

2. Don't over hire

1993 Today

Founded Fouress Merged into Exodus

Exodus IPO

NetMagicAcquired by NTT

Ankeena Acquired by

Juniper

3Leaf

Inabling

NetScaler Acquired by Citrix

EduriteAcquired by

Pearsons

Ocarina Acquired by

Dell

Arkin Rakya Cloud Vel

Attivo Whodini

ScaleArc

MobileForce

Fine line between Success and Failure

Televital Numerify

Nutanix

Woxi

Fine line between Success and Failure

Is it Technology?

Is it Execution?

Is it the Market?

Is it the Luck?

Is it the Attitude?

Is it the Money?

Is it the People?

What’s the Fine-Line?

“It is mainly the People with the right

Attitude and ability to Execute what the

Market wants with an Innovation and

some amount of Money and Luck’’

What Clicks Between Success and Failure ?

Navigate during changing markets

Assign right resources to better execute

Manage finances at all times

Change the priorities based on Needs

Hire best people without just money

Lead and bring right leadership

People Figure Out how to

PRODUCT MARKET FIT

Who’s your customer

What problem are you solving

What is the value of your product to the customer

ROI ?

customer willing to do a POC?

Willing to write a check for POC

Go beyond POC to production?

Is the product ready for main stream?

PRODUCT MARKET FIT(SLICING AND DICING THE MARKET )

F500, High Value, High $$, More complex environment ( 1B+ )

Mid Size Business( 500 – 1+ B )

Small/Mid Size Business

Small Business

Very Small Businesses

Size of Business Vertical Markets

MFG High Tech

Oil &Gas

Health Care

Web Centric

Auto Retail Fin Media

& Ent

POSITIONING

Know how and when to say NO

Know what markets

Know what features are needed for that market

Focus on few things and do it right

Know who the buyer is

Let it be large Market

Avoid trying to satisfy every customer – you will become consulting company

HOW TO WIN EARLY CUSTOMERS

Your or your board/investors contacts

Hiring Sales/BD

Domain expert or hunting sales guys

Smart ways of finding customers

Work through product deficiencies

Offer good discount for being an early customer

Use LinkedIN, Hotjobs, Monster

Google Ad words, SEO

Case Studies – Exodus, NetScaler, Nutanix, Netmagic

PRODUCT CONTINUITY

Every Market you pick the product has to go deeper

At some point of time you have to expand into other markets

Don’t ignore the first market – product needs to evolve constantly

Packaging of your product with engg changes can take you to new opportunities

Acquisition of other companies – Company culture, product integration, people continuity is very important for a better success

MARKETING

Lead Gen Programs

Marketing Collateral – Case Studies – Public/Private without revealing names

Analyst influence

Pricing

Packaging

Company launch and Product launch

Events.

EXODUS REVENUE GROWTH

1994 – 200K

1996 – 2M

1997 – 12M

1998 – 48M

1999 – 200M

1995 – 600K

2000 – 800M

Uncertainty Phase ~ 3.5 years

Winning Hotmail

Aug ‘94- first Sales/BD VP

Nov’93 Birth of Company

Start Channel Operations

EXODUS TIMELINE

Internet Data Center evolution

Founded by2 people with

~10K personal $

1993

OctoberKicked Off Business

Internet Solutions

1994

IntroducedInternet Consulting, 1st form of Hosting

Still No funding, House Mortgaged, Loans from

other companies

1995

August - Built 1st ever Internet DataCenter)

Feb’96 Series A- $3.5MOctober’96 Series B - $7M

1996

Got rid of various consulting business, ISP. Focus on IDC mkt.

Web centric companies early customersMay - Raised another 20M Mezzanine round

1997

IPO in March350M mkt cap. Raised

75M

1998

NetScaler Confidential

NETSCALER REVENUE GROWTH

1998 – 0

2000 – 200K2001 – 700K

2002 – 2M

2003 – 10M

1999 – 0K

2004 –20M

Uncertainty Phase ~ 4.5 years

2005 –50M

Winning Webex

Hired VP Sales

Hired 1st VP Sales

Hired BD

NetScaler Confidential

NETSCALER TIMELINE

Web Application Delivery Innovation

Angel Investment

3M

1998

World’s Fastest Load Balancer

$37M

Load BalancingContent Switching

2000

2-4x fasterSecurity & AppCompress

AppCache

First Accelerated Web ApplicationDelivery System

13M fromSequoia Capital

2002

5-10x fasterAppCompress MP

AppCache (dynamic)

Continued raising the bar

20M Late Stage

2004

15x→AppCompress Extreme

AppCompress MP (bi-directional)

Application Firewall

Citrix bought at 325M

2005

SSL-VPN and WAN Optimizationn

2006

NetScaler Confidential

6,000+Enterprise Deployments

75%of Internet Users

PROVEN IN WORLD’S MOST DEMANDING ENVIRONMENTS

Magic of Marketing

PARTNERSHIPS

Two small companies partnering is generally hard and risky

Partner with a big company – do it when you don’t have to allocate all your resources to that one company.

Investment needs to be well thought out – what the implications are with other similar companies

Case Studies – Ocarina – Dell, Exodus- Akamai, NetScaler – Juniper

GEOGRAPHIES

West Coast – California and East Coast NY are generally the first mkts to go after

Depending on the product you expand next locations into Texas, LA, Chicago, DC

Next cities would be Seattle, Detroit, Boston

UK and Japan first international countries UK similar culture to US. Easier for market adoption

Japan – love to have US references. Slow to adopt. Once loyalty is built lasting relationship

Very expensive proposition – make sure to have good valid points

Other European countries – preferred to start as consultants

Other Asian countries – Korea, Taiwan, HongKong, Singapore

Channel/Distribution would be ideal in most countries.

INVESTMENTS AND VALUATIONS

Seed, Angel, Initial services revenue, VC funding, Strategic investment

No standard formula for valuations

First time entrepreneur – most often takes hit.

Let the market set the valuation

Pedigree Helps

Have some revenues and customer validation. Seek money for expansion

Don’t overly worry about valuation - 100% of 0 is 0

The Next Big Shift

Content

Distribution

Network

Messaging SaaSAny Enterprise

Storage and

computing

?

(What a startup company can do)