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Showing 14 posts tagged startup

Goodbye Gym Membership

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[Photo Credit: Ajna Dance]

[– Special deal, join ClassPass, get $50, I’ll give $50 to Defy Ventures –
Update 3/8: We raised $150 for Defy Ventures!]

Last night I learned it was more ‘Bhangra-like’ to use your fingers in a thumb-to-fingers clap motion, “imagine you’re flicking an apple off of a tree”, than hold your fingers straight up with a wrist twist, referred to many as “turning the lightbulb”. 

I’m not a regular at Bhangra & Bollywood Dance class by any means. This was my second time ever taking a Bhangra dance class. I’m a long way for this but at least I have few new moves.

Would I do it again? Sure! I was joined by three friends and it was a ton of fun. Would I go every week? Maybe not.

The great news is, with ClassPass, I can decide how often I want to go back without fear of missing out on a ‘package discount’ for buying X number of classes that would need to be used by Y date.

I’ve been singing the praises of ClassPass since I joined in October. I quit my monthly gym membership and instead take classes at different workout studios throughout the city. I’ve recruited a number of friends already and they’re hooked. Currently, for $99/month you get unlimited access to their 200+ gyms in NYC as well as the ability to take classes in their other markets (including SF which is great for my regular trips to the west coast USV portfolio). From ballet to spin, boxing to crossfit, dance to parkour. They have it all.

I’m not employed by the company nor are we investors. I’m simply a huge fan and have $50 for you if you join too — more info below. With great enthusiasm for product, I’ve had some questions about how the business will grow, sustain and live in harmony with the studios it helps promote.

Bucking the gym business model

I quit my monthly gym membership to use ClassPass in exchange. Health Club business models are largely subsidized by individuals who pay each month but rarely use the facilities. Contracts with high cancellation fees cover the labor costs, depreciation on machines, and upfront equipment investment.

Gyms focus on signing up new members, and ideally would find the right mix of individuals who want to use the gym at different times or not at all. They have limited capacity at peak times, so some have become more dynamic to charge access for non-peak-hours. Access to multiple locations is usually another add on. Personal training and other services can be layered on top. That’s the extent of dynamic pricing.

That means, if you go once a month or thirty times a month, you’ll pay the same price for the majority of the service. Less frequent members subsidize the more frequent ones.

Through ClassPass, you currently pay one fee for unlimited classes per month. This is the same model that gym memberships employ. It’s easy to charge but it may be missing additional value that can be captured. As a consumer, I hope they don’t put in tiered pricing for frequency of use, but they very easily could. They already track the quantity of classes you take and count them on a monthly basis.

Additional layered services could be earlier access to book classes or a “spending per month” that could cover costs like renting spin shoes or extra towels at gyms that offer those upgrades.

Will studios win or lose?

ClassPass limits 3 visits per month to a particular gym. That means if you find a class you want to go to twice every week, you can’t do it. If you discover a class you love, you can take the steps to setup a membership with that studio directly. You can keep your ClassPass membership as well or cancel it and just commit to the ones you want.

The alternative is to arrange some clever hacking to build a schedule that allows you to max at your 3x classes at your favorite gyms and then find close supplements for other days. If you want to spin 2x a week each month, you need to find 4 studios with classes you like. Or if you travel for work, it may mean finding 3x studios in NYC and 1x in SF to use. That’s a bit more work and a bit more to keep track of. If you find a class you absolutely love, it’s probably work committing with them directly.

Does this model work better for studios or worse? Does it cannibalize business from individuals who would normally pay $10-$35/class to come 3-4 times a month? Or does it expand their market. Since they can reach more people, do they raise more awareness and ultimately sell more memberships directly? Does ClassPass make the pie of ‘class-takers’ larger so all boats rise?

Discovery of new studios was limited to word-of-mouth, foursquare, Gilt City, and online promotion. It would be a fair bit of work to sign up for the different classes, compare prices, and commit. On top of that, most of the studios are small businesses. Their pricing could be confusing. $100 for 10x classes or $150 for 20x if you use in the first three months. First class free or first week unlimited for $10. They would want to sell you so early in the process that it could be distracting from just figuring out whether the classes and schedule would fit.

The discovery wasn’t great or easy. That may be a win for the studios as switching costs were high, but a loss for new studios with little clout.

Margins and monetization

ClassPass doesn’t rent any studio space, nor do they supply free weights or mini trampolines. They are the information layer that connects the physical studios. I don’t know the intimate details of their monetization, but I know they currently only charge $99/month for members. That money likely goes largely to the studios and a small take rate is used to cover development costs, a sales team and operations.

How much money does a studio get? If a member goes to 20 classes a month and only pays $99, and let’s say ClassPass takes 10% which would include the credit card transaction fee,  that would mean at most (with $10 going to Classpass) the studio would get $4.50 per class. That’s pittance compared to the $10-$35 they may charge for each class.

Now, $4.50 may not be much, but it may make sense for the studio. Once a class kicks off, it’s a fixed cost. Whether there are 2 people in the class or 40, the instructor, rent and equipment is already paid for. If a studio is able to increase utilization for each class, the additional students, at any price, are worth taking. Now, they need to consider costs like depreciation on equipment for that additional student, like a spin bike, and the impact on experience for other attendees who are paying full price and expecting access to showers, enough floorspace, etc.

Studios would just have to make sure that financially, filling more classes, at different prices, means they cover their fixed costs. Having every customer on ClassPass may not work out for them.

Cash flow also comes into play. I’m not sure if ClassPass buys blocks of classes from the studio each month or only pay commission on successfully booked classes on a monthly basis. Studios with regular members usually get membership dues before they host the classes, easing forecasting and cash flow. ClassPass may pay later.

Join ClassPass, get $50 & support Defy Ventures

I’m excited to see where ClassPass goes next. They have great team they’re building in NYC and a huge network of studios they’re growing nationwide. I’m sure their revenue model will be evolving but I’ll be enjoying all of the benefits at the current price while I can.

If you’re interested in signing up, they are currently running an offer to give $50 to anyone who signs up, and give $50 to anyone who refers someone in.

Now here’s the deal, if you use the promotion link to sign up for ClassPass by Sunday 1/19 (promotion extended!), you will get $50 for yourself and the $50 that I receive I will donate to Defy Ventures, a fantastic non-profit organization that transforms the lives of people with criminal histories through entrepreneurship, employment and character training*. You get ClassPass, $50 and you get to support a great group.

Update 3/8: We raised $150 for Defy Ventures!

[*Full details: This offer is limited to the ClassPass promotion which ends 1/18/15, 11:59PM. ClassPass does not provide cash awards but giftcards. If you sign up it will be $99/month but you’ll get a $50 Visa Giftcard in the mail. I get one too. I will donate the cash equivalent of the $50 giftcards received. ClassPass may notify me if new members sign up through that link, I may not have access to your email address so please feel free to send me a note on twitter that you signed up so I can say thanks!]

Bug Reporting for Recruiters

Every technology companies’ hiring process has bugs. Not software glitches, but human error, flaw, failure, and fault that causes it to behave in unintended ways.

Hiring practices include only reviewing candidates that attended a small list of schools. An incredibly talented engineer is skipped because his school isn’t recognized by your hiring manager.

An interviewer couldn’t articulate it exactly, but felt the candidate wasn’t a fit for the company culture. The interviewee was a great match for the role, but the opposite personality type of the interviewer, someone from a different team.

A star candidate becomes less interested in working on your team when they realize they are the only person in the company who is not like everyone else. Your hiring manager assumes the candidate took another role (but doesn’t ask) for other reasons and moves on to their second choice.

Leadership insisted the ‘big job’ go to a candidate that came from a big company. The hire had only worked on large teams, experience that had little use within the small company where they were hired. High salary paid, recruiter compensated, and an employee who left after 12 months.

The hardest thing about bugs isn’t the error they throw, it’s finding them in the first place. Only companies who invest time in running QA on their hiring process will build the innovative teams they want. That of course requires knowing what you want in the first place.

Having a hiring process is important, almost as important as remembering that it’s all based on the bias of the people who built it.

If you have something to share, drop a line in the comments or send me a line on Twitter.

To subscribe to weekly email updates, sign up here.

Maturity Map- Dunbar Stage: 150+ employees

The most common questions I hear from startup founders and team members are, “What are the best practices? What lessons have others learned? What’s coming next?”

The purpose of the Maturity Framework Series is to help startup founders and teams to anticipate what is coming next. This post will specifically look at the Dunbar Stage, when a company grows beyond 150 employees.

Company Stages by Number of Employees

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Links to full posts detailing the Early Stage, Momentum Stage, Expansion Stage, Growth Stage, and Scale Stage.

Dunbar Stage:  150+ employees

I’ve intentionally left no limit to the capacity of the next stage, no end state or upper bound. It starts at 150 employees and grows from there. I’ve done this for two reasons. First, the density of the USV portfolio companies hover between 30 – 150 employees, we have the most network knowledge in this company size. Second, there are changes that need to happen at this size of an organization that will continuously be required. I intentionally did not include pre-IPO company requirements here as it has less to do with employee headcount, and more with other factors. If you’re interested in what’s required of a pre-IPO company, you can read more here.

Now, what is the Dunbar number and how will it influence our company structure once we have over 150 employees?

“Dunbar’s number is a suggested cognitive limit to the number of people with whom one can maintain stable social relationships. These are relationships in which an individual knows who each person is and how each person relates to every other person. This number was first proposed in the 1990s by British anthropologist Robin Dunbar, who found a correlation between primate brain size and average social group size.[7] By using the average human brain size and extrapolating from the results of primates, he proposed that humans can only comfortably maintain 150 stable relationships.[8] Proponents assert that numbers larger than this generally require more restrictive rules, laws, and enforced norms to maintain a stable, cohesive group.” (Read more on Wikipedia)

The TL:DR version is, our brains can only sustain 150 meaningful relationships at one time. Now, there are many questions as to whether the actual limit is 150, look at Facebook or LinkedIn connections, with some users maintaining 250+ contacts, but when we focus on individuals within an organization, all working together, this number is a typical break point. Fast growing startups may feel this break point between somewhere between 125 and 225, but we’ll use 150.

Before we get into the specifics of the Dunbar stage, let’s take one minute to step back to think about the scale of 150 people. Think about sitting in your living room with 15 people, and let’s say they invite 15 more people. You’re now standing because you don’t have seating for 30. Now the party next door comes over with their 30 people, people are clumping in smaller groups to have a conversation and you’re worried about the line for the bathroom but with 60 people, you can still look around the room and recognize faces. Now imagine the restaurant down the street invites all 75 of their guests to your party. People are elbow to elbow, it’s impossible to hear the person next to you because the noise of the crowd is so loud. You now have 135 people at your house and your 15 best friends just showed up. You let the chaos bubble around and hope that no disagreement occurs. At one point you try to make a toast, but your attempts at quieting the crowd leads nowhere. Time to make room for the new guests soon on their way.

150 people is a large group, that requires a certain physical amount of space to be comfortable, and that doesn’t touch on the social constructs required. As an employee, even if you know everyone’s name still, you can no longer know exactly what everyone is working on, and when. The politics of each team are now local, not team-wide. You have blind-spots. Just like at a party, you can’t see how everyone is interacting at once. That’s okay. That’s the point, to scale with trust and distributed decision-making.

A successful organization requires new structures, policies and organizing principles to build the trust required to function at this size. As a CEO, you need to trust your management to drive their part of the business, take care of their teams, escalate any issues, and provide feedback as a whole. Your organization will be a collection of smaller organizations working together, not just a collection of individuals. It’s a society now, be mindful as to whether you’re building it like a democracy or a dictatorship.

Depending on the business model, early success, and senior leadership, the scales may be working in your business unit’s favor. For example, in an engineering-focused company, the early team might be 50-75% engineers. Resources, headcount, and positioning efforts always favored engineering. As the company grows, the demand for additional engineers may slow, but the demand for sales may grow. At 150, the team may be 50% sales people, 30% engineering. Resources will flow accordingly.

Shifts in team focus are not a good or bad thing, just a shift that should be addressed, acknowledged and not ignored. Folks on those respective teams will see that shift in power and it may ruffle feathers. Ex:

“Why does marketing get more resources now?”

“I want to work on the sales team instead of BD, they have more engineering resources since they’re bringing in revenue.”

The new team structure is not bad, but the change from how ‘things were’ won’t go unnoticed. Address them, communicate and react accordingly. The danger occurs when this information is passed only in back-channels and it creates uncertainty. You will have uncertainty, be open about it in order to align on what is actually uncertain. Like a rumor, if you let it out of your hands, you lose control of the message.

Leadership needs to err on the side of more communication and teams need to build more process. I can hear it now, “Process? Yuck! That’s only for big companies, that’s why I joined a startup, to get away from process.” You will face this, the default for most startup companies is to reject process in favor of innovation. The often overlooked point is that good process enables faster innovation.

Early companies have process, they just don’t label it that way. An engineer may build a prototype on their own, bring it to lunch to get some feedback, and make improvements afterwards. That is a process. There aren’t many parts to it, but it is a process, something that doesn’t sustain over time, or just gets sloppy. Imagine 10 engineers all clamoring for feedback on their prototypes each day at lunch. It’ll get noisy, you’ll need to double the length of lunch. It’s sloppy process.

Scaling a company requires elegant process, the kind that is barely noticeable. If you are a fan of watching Apple Keynotes or engineering talks, you’ll notice the phrases like, “We looked at the landscape of what was out there and decided…”, and “Our team spent a year developing this new product” These individuals are describing their process in it’s elegance. They aren’t saying:

 “We had 2 PMs that prioritized this item in Jira for 4 months, we had to get feedback from engineering and senior management to push it forward in Q4. We had input from marketing, customer support, and HR to ensure we weren’t having any conflicts with external events that may delay or change our timeline. Then, we brought the idea back to the team, created sprint cycles for the next 6 weeks, making sure our backlog wasn’t creating roadblocks. Oh, and we also had to kill a lot of other things along the way to make it happen, there were disagreements and back-and forth emails among sales, product and engineering. Our CEO believed in it but actually wanted it 6 months earlier. But hey, here we are now.”

Process can be daunting to setup, as it’s never done. New components will come up that change what you need to do. App store review timelines have changed a number of times, each time it happens, everyone who has a mobile app has to consider the impact to their process. It used to take 24 hours for an app review and now it takes 7 days? Time to make sure you let communications know, so they know the press release will go out a week later. Don’t let the need for flexibility, stop you from putting process into place.

The advantage startups have over other companies is that change is part of the DNA. Building iterative products to serve customers is core to how the team works. Leverage that mindset for process, that it’s iterative, great products make people happy and things easier. Positioning critical process as  ‘internal tools’ or ‘business products’ can change the perspective. These are products that serve customers, those customers just happen to be employees of this company. As you did with the company, make sure you’re staffing correctly to enable internal tools teams to successfully deliver.

So how does a company at 150 or 300 evaluate their success? Take a look at three things:

  • How do decisions get made?
  • How does positive information flow?
  • How does negative information flow?

These will help identify some of the largest organizational challenges as you scale. You will iterate on the ‘ideal’ outcome for each of these questions constantly. Build the communication and processes to make it easier to identify challenges and improve over time.

Current state of the organization:

  • You know what you stand for
  • Stable, but constantly changing

Things you’re doing for the first time:

  • Hiring Executive coaches for your leadership team
  • More management tiers
  • Expansion in new markets or languages
  • Reaching or settling into profitability
  • Building teams that take care of your teams, like a learning and development team
  • Introducing support roles in Sales or HR that are more focused on execution
  • Build roles that are deeper, less wide.
  • Increasing the strength of your finance and security teams.
  • Thinking about IPO or late stage financing.
  • Paying market rates for talent, once you’ve evaluated title-fit

What you’ve already solved:

  • Better knowledge of your company’s ‘core focus’
  • You know what you’re doing, your title may actually reflect what’s expected
  • You continue to double down on profit generating parts of your business: engineering, product or sales.
  • Expectations that team structure will change
  • Right-sizing titles to fit the teams

If you have something to add to this list, please share in the comments or send me a line on Twitter.

To subscribe to weekly email updates, sign up here.

Footnotes:

*Please note, this outline is based off of trends I’ve seen in venture-backed startups. It very easily could apply to bootstrapped or non-venture funded companies, but not necessarily. In this outline I assume the company has taken funding.

**We’ve invested in a number of companies mentioned in this note. For a full list, visit our Portfolio Page or find opportunities with them through the USV jobs page.

Maturity Map- Scale Stage: 75-150 employees

The most common questions I hear from startup founders and team members are, “What are the best practices? What lessons have others learned? What’s coming next?”

The purpose of the Maturity Framework Series is to help startup founders and teams to anticipate what is coming next. This post will specifically look at the Scale Stage, when a company grows from 75 employees to 150.

Company Stages by Number of Employees

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Links to full posts detailing the Early Stage, Momentum Stage, Expansion Stage, and Growth Stage.

Scale Stage: 75 – 150 employees

Getting to 75 employees happened before your brain could process it. This is often the case, you plan to grow slowly and then within a short period of time you add 30 new employees in less than 6 months. Welcome to the scale stage.

Your company is at the point where you know what your mission is, you understand your market and the most important piece is serving more customers faster. Your teams will grow quickly with more experts in the areas you need it. This is no longer a mystery, but it’s growing existing teams to have more manpower.

The skills required of your team are changing, make sure to let the team mature. The shifted demand for experts may mean a number of early employees are leaving. That’s not a reflection that you’re doing something wrong, that’s a natural shift. Some people prefer smaller teams, others want to change the work that they’re doing. Prepare your process to help employees who are exiting, including exit interviews and a standard for equity execution plans. An informal poll of our portfolio companies that less than 5 of your first 20 hires will stay with the company beyond 100 employees. 

You will need more leaders, managers and reporting structure. This doesn’t require you to set up a bureaucratic process. It does require providing enough structure that each member of your team can focus on doing their best work, not worrying about who owns what project or where they should take feedback. Imagine it as building a map to a new town. When it’s two houses, it’s easy to find your way, when you have 20 houses, you’ll need an easier way to identify where people are and what they are working on. Since you’re adding employees quickly, that organizational structure will help new hires even faster. 

Focus should continue to dictate what gets prioritized. Make sure the senior leadership team you’ve built understands that and doesn’t get lost in defending ‘their turf’. Another risk is making sure leaders are empowered to provide the CEO with honest feedback. No single person in the company will know everything going on, trust, communication and transparency are key.  

Current state of the organization:

  • You’re building out a matrixed organization under your new executives
  • Meetings: weekly one-on-ones, weekly senior leadership discussions, townhalls
  • Founders are focused on growth
  • You’re raising your Series B, C or D
  • You have analytics in place and a real amount of historical data for comparison
  • You’re finally making decisions based on data
  • More management brings up questions around career progression
  • Your office is likely bursting so a move will happen in this stage
  • You know the board and are better at utilizing them as a resource
  • You bring executives into board meetings, less is presented by the CEO
  • Revisit your mission, vision and values – make sure you stay focused
  • You’re likely known in your market or a larger business market, you have a reputation now- make sure you know what it is

Things you’re doing for the first time:

  • Creating more robust reporting structures under new executives
  • Retitling, especially if early titles were inflated
  • Increasing communication to give ‘new folks’ the same access as ‘veterans’
  • Raising your Series B, C or beyond, being mindful not to get too far ahead of your valuation as it may limit future round sizes
  • Restructuring your team (again) around new management
  • Increasing your data infrastructure to help departments make decisions
  • Having policies and protections in place to prevent employee security breaches
  • Your infrastructure team now has some time to tackle some of the backlog
  • Negotiating a new option pool to continue to provide equity to those who are close to vesting
  • If you offer meals, figuring out how to feed 100+ people at scale
  • Building your sales team to feed the revenue machine
  • You’ve recently hired a Head of Product or you will in this stage
  • Tools are up for debate as sales, marketing, product and engineering all want something different
  • You have recently hired or are hiring a second office manager to keep up
  • You’re figuring out how to handle equity grants for employees who leave
  • You may have reached sustainable profitability with enough growth capital to continue, figuring out where to invest becomes crucial

What you’ve already solved:

  • What the company is solving: stake in the ground
  • Key OKRs
  • Testing revenue models
  • Milestones you’re going to accomplish in the next 6-12 months
  • Understanding the largest opportunities and the biggest threats in your market

Software you use:

  • Payroll - ADP or TriNet
  • Benefits – Private broker
  • Accounting – Intaact, Netsuite or a third-party accounting firm
  • Google Apps for email and documents
  • Dropbox or Box
  • Google & Flurry Analytics plus MixPanel or Localytics for data
  • Using Hadoop, Redshift and Tableau for data
  • You’re starting to build your own data tools
  • AWS or your own servers
  • Zendesk or Desk for customer support
  • Sprout Social or Hootsuite for Social Media
  • Jira for Product Management
  • Github for permissions & software sharing
  • Salesforce CRM for your sales pipelines
  • Careers 2.0, Indeed and external recruiters to hire outside of your network
  • Stripe and Dwolla for payments
  • Skype, BlueJeans, Zoom.us (http://zoom.us/) or Google Hangouts for remote meetings
  • Hiring Platform: Lever.co, Greenhouse.io or BambooHR.com

Who you need to know:

  • Catering: ZeroCater, Food2Eat (links) or an in-house Kitchensurfing chef
  • Recruiting firm for executive hires
  • Management training coach
  • Lawyers to review equity documents & update the cap table
  • Journalists you’ve built relationships with to write-up new features
  • Skilled friends who may refer top talent to your company
  • Mobile platform gatekeepers to promote you in their stores
  • Full time accountant to manage books
  • 409a consulting firm to evaluate equity
  • Specialists in SEO, SEM, PR, Marketing and Branding

Additional decisions that may start in this stage:

  • Having multiple offices or remote employees
  • Offering your product in more than 5 languages
  • Securing visas for international candidates
  • Hiring outside or in-house council, for more regulated industries
  • Negotiating a lease on a new office
  • Hiring a white hat security firm to run an audit
  • Opening an office in a different country
  • Accepting foreign currency or cryptocurrency
  • Hiring an external CEO candidate

If you have something to add to this list, please share in the comments or send me a line on Twitter.

Next up, the Dunbar Stage, growing a team beyond 150 employees. To subscribe to weekly email updates, sign up here.

Footnotes:

*Please note, this outline is based off of trends I’ve seen in venture-backed startups. It very easily could apply to bootstrapped or non-venture funded companies, but not necessarily. In this outline I assume the company has taken funding.

**We’ve invested in a number of companies mentioned in this note. For a full list, visit our Portfolio Page or find opportunities with them through the USV jobs page.

Maturity Map - Growth Stage: 50-75 employees

The most common questions I hear from startup founders and team members is, “What are the best practices? What lessons have others learned? What’s coming next?”

The purpose of the Maturity Framework Series is to help startup founders and employees anticipate what is coming next. This post will specifically look at the Growth Stage, when a company grows from 50 employees to 75.

Company Stages by Number of Employees

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Links to full posts detailing the Early Stage, Momentum Stage, and Expansion Stage.

Growth Stage: 50 – 75 employees

You found your market, now it’s time to grow, grow, grow! You have found early momentum, now it’s time to double down. The mistake companies often make at this stage is they see growth as a signal to start a wider land grab. Focus is more important than ever. With more employees, progress and (possibly) money, you’ll be tempted to expand the market you’re serving. This is not the time, build solid ground in what you know. Grow up, not out.

Get your metrics in order. Work off of better data. Build out your leadership team. Worry about getting the right people in the right seats. Stay focused.

Current state of the organization:

  • You’ve hired your first executives or experienced managers
  • Meetings: weekly one-on-ones, townhalls, monthly hackathons
  • Founders are focused on strategic planning and building the right team
  • You’re raising your Series B or C
  • You have a few years of metrics and you’re starting to run A/B tests
  • You’re finally getting your data in order
  • More management brings up questions around career progression
  • Setting up the HR process- adding an HR coordinator, bringing the team to 2
  • Your office space is filling up but likely not time to move in this stage
  • You know the board and are better at utilizing them as a resource
  • You start to bring team leaders into board meetings
  • Revisit your mission, vision and values – make sure you stay focused

Things you’re doing for the first time:

  • Hiring Executives, possibly a VP of Product or Head of Sales
  • Increasing communication, including better onboarding
  • Raising your Series B or C, using more metric-driven forecasts
  • Deciding how to recognize great ICs without management promotion
  • Structuring your teams around KPIs to align with the company vision
  • Increasing your data infrastructure to setup and run tests
  • You’re big enough now that a data breach will matter, make sure you have a plan
  • Your infrastructure team has finally caught up to keep the platform stable, more forward thinking work can be done
  • Thinking about equity for those who are close to vesting and equity incentives
  • If you offer lunch, figuring out how to feed 50+ people at scale
  • Building your security team, if a marketplace – in community and engineering
  • Building out a formalized user testing process
  • You’ve recently hired a data lead or will in this stage
  • Changing your sprint cycles from 2 week sprints to 6 week epics (with 3 2-week sprints)

What you’ve already solved:

  • What the company is solving: stake in the ground
  • Key KPIs, or now you’ve changed to calling them OKRs
  • Milestones you’re going to accomplish in the next 6-124 months
  • *See the Expansion Stage Maturity Map for the complete list for teams less than 50.*

Software you use:

  • Payroll - Paychex, ADP or TriNet
  • Benefits – TriNet or Zenefits
  • Accounting - Intaact, or Netsuite
  • Google Apps for email and documents
  • Dropbox or Box
  • Google & Flurry Analytics plus MixPanel or Localytics for data
  • Using Hadoop, Redshift and Tableau for data
  • AWS or your own servers
  • Mac books
  • Zendesk or Desk for customer support
  • Sprout Social or Hootsuite for Social Media
  • Trello, Asana or Jira for Product Management
  • Github for permissions & software sharing
  • Highrise, Bases or Sugar CRM for sales pipelines
  • Careers 2.0 and Indeed to hire outside of your network
  • Stripe or Braintree and Dwolla for payments
  • Skype, BlueJeans, Zoom.us or Google Hangouts for remote meetings
  • Hiring Platform: Lever.co, Greenhouse.io or BambooHR.com

Who you need to know:

  • Catering: ZeroCater, FoodtoEat or an in-house Kitchensurfing chef
  • Recruiting firm for hard hires: engineers & VP+ level tech, product talent
  • Lawyers to review equity documents & update the cap table
  • Journalists you’ve built relationships with to write-up new features
  • Skilled friends who may refer top talent to your company
  • Mobile platform gatekeepers to promote you in their stores
  • Full time accountant to manage books
  • 409a consulting firm to evaluate equity
  • Specialists in SEO, SEM, Marketing and Branding

Additional decisions that may start in this stage:

  • Having multiple offices or remote employees
  • Offering your product in more than one language
  • Securing visas for international candidates
  • Hiring outside or in-house council, for more regulated industries
  • Negotiating a lease on a new office
  • Hiring a white hat security firm to run an audit
  • Opening an office in a different country
  • Accepting foreign currency or cryptocurrency

If you have something to add to this list, please share in the comments or send me a line on Twitter.

Next up, the Scale Stage, growing from 75 to 150 employees. To subscribe to weekly updates via email, sign up here.

Footnotes:

*Please note, this outline is based off of trends I’ve seen in venture-backed startups. It very easily could apply to bootstrapped or non-venture funded companies, but not necessarily. In this outline I assume the company has taken funding, whether Seed or Series A

**We’ve invested in a number of companies mentioned in this note. For a full list, visit our Portfolio Page or find opportunities with them through the USV jobs page.