Perspectives

Brian Patterson, Partner at Gunderson Dettmer Discusses Early Stage Financing and How To Structure Convertible Notes

August 31, 2017

Brian Patterson Partner Silicon Valley law firm Gunderson Dettmer chats Emergence's Joe Floyd best structure seed financing conversation cover number topics including ways early stage difference convertible note SAFE startup choose companies raise notes approach board governance happens people outstanding fundraising environment turns lessons entrepreneurs know situations Watch video listen podcast

How to Avoid the 7 Deadly Sins of Seed Financing

August 31, 2017

fastest scare Series investor casually tell 8MM convertible notes outstanding raised 3 years 30 small investors exact scenario happening often entrepreneurs opt kick valuation road raise increasingly large seed rounds SAFEs simple agreement future equity time wise understand math behind financings use real example explain painful note conversion created Google sheet realistic transaction Please feel free download Excel copy Drive Avoid 7 Deadly Sins 1 Multiple Liquidation Preferences sample modeled founders 10MM 2.5MM 7.5MM cap table shows 15MM due interest converting caps discounts principal value buy proportionally shares pretty straightforward founder yield 7.5MM+ result 5MM less money available common exit preferred convert addition 3x number calculating voting pro-rata rights blocking anything else based share counts Solution specify signing limited 1x plus shadow similar price mechanics lacking blend accomplish 2 Compounds Quickly majority see accrue rate 8 per year sound adds impact accrued multiplied finance companies hit hard recently saw company 4 period alone 2MM 1MM swells 26 1.26MM required law Set investing rich take care Full Ratchet entrepreneur choice accept every smile gladly SAFE 25MM 20 discount pre-money 20MM converts 16MM definition execute priced round Devil Details standard format tweaked amended point lawyer recognize document bottom line need specific calculated included option pool refresh denominator advantageous effect lowering questions consider diluted holder threshold met protect specifying calculation leave interpretation later 5 Rounding Cats Dogs larger contributing party gone seen individual great receiving nightmare sign legal documents conversations opportunities unhappy negotiated potentially blow general think limit holders best institutional lead highly recommend write drag along right financing allows compel predetermined 60 vote 6 Forced Repayment Maturity never assume someone want capital returned inconceivable successful prior expiration usually course raising increases odds little longer figure product-market fit thus EXACTLY skittish demand cash back Choose experienced risks ask know reputation shot Inexperienced likely head hills 2x M&A Outcome acquired generally receive effectively kill return acquihire first though put another 1.5MM sold business 4MM employees wind nothing SAFE's definitely help either participate as-converted basis debt instruments used responsibly original case bridge instrument funded insiders achieve near term milestone effective amount total 10 quality manageable anticipated horizon 18 months situation using unequivocally governance structure Yes slower expensive save Special thank Brian Patterson Partner Gunderson Dettmer sharing knowledge expertise post watch video interview podcast discussing topics

The Building of a Market Leader (That Almost Didn’t Get Built)

July 25, 2017

story behind 850 million dollar acquisition Intacct's Sage largest U.K tech company began decade ago memories difficult time tested conviction vivid December 2006 Intacct money interest corporate buyers suddenly backed co-investors help without additional funding Emergence Capital option shut doors made initial investment 2005 results disappointing since beginning Bookings growth anemic despite efforts unable make key management hires targeting missing several quarters realized cash last long planned summer major RIF extend runway introduced CEO favorite impressed momentum team Reluctantly hired banker explore potential meantime partners discussed options enterprise financial application market planet best product step fund now partner asked matter believe emerge leader happen ones write check take twice reserved join argued huge lead years anyone else competitive wait investors see opportunity responded feeling dizzy losing hope convinced become venture firms decision career suicide accusations throwing good bad willing bet placed strong Together came encouraged participate day knew changes capitalize decided terminate half within next weeks following 11 easy Selling software similar heart transplants nobody wants new accounting system know need Customers want proven bugs hiccups execute flawlessly shortcuts earliest days faced competitor Netsuite recently bought Oracle never let guard success come give highest customer satisfaction ratings seen successful startups VC 1988 every built solely charismatic founder people deserve credit deep gratitude everyone put hearts souls progress along including Rob Marc Taylor Dan Derek Ian Haris Clark Mike Jerry Andrew Bob Scott others Reid deserves special thanks leadership 2009 superpower leading teams world-class execution honored supported behalf shareholders knows build employees love say Aaron Harris Kathy Lord part core invested commitment drive pleasure watch professional power validates belief entrepreneurs passion change world seeks leaders proud brought juncture UK technology worldwide ideal leverage strengths wish purchase

Emergence Capital Invests in PRM leader Impartner

July 18, 2017

CRM work indirect sales channel believe first talked half dozen executives tried configure Salesforce.com teams problem found used charges per user basis fine direct team single VAR 5 employees global partner network hundreds partners thousands nightmare Every needs configured credentials permissions often training standard objects apply organized differently realize per-user licensing costs ongoing support prohibitive managers told visibility pipelines know salespeople effective forecasts blindsided end quarter struggle piece together data understand problems widely adopted industries account majority revenue use spreadsheets DIY databases manage complex web companies resources need gets left want build reliable tool specific job management Relationship PRM around 20 years never produced large public company providers serve niche markets point solutions content loyalty promotions compensation long ago surprised learn three Emergence portfolio buying solution selected Impartner Utah-based provider cloud guess surprising high growth B2B successful expanding distribution resellers evaluation case won clear margin customers seen 30 increase average adopting seems obvious typically spend time phone answering questions see information online cultivating additional met Joe Wang CEO plan make common Impartner's product broad modular suite practices virtually industry proven among technology users now penetrating manufacturing telecom energy benefits finding Imparter's exploding assembled seasoned focused key elements market leadership scalable multi-tenant architecture sustained customer success efficient deployment process invests helps become leaders category pleased announce investment

The Industry Cloud Playbook

July 4, 2017

Industry cloud core investment thesis Emergence highest level believe focused applications solve challenges better horizontal software designed function fortunate invest leaders including Civitas Learning Doximity several others recently hosted forum San Francisco bring together entrepreneurs thought course event discussed opportunities associated building companies specific verticals put videos place listen learn thoughtful discussions hear fundraising strategies data machine domains product pricing Founder stories journeys Feel free browse let know think Hope enjoy Capital Formula Winning Vertical Joe Floyd Partner Thinking High Low Veeva's Secrets Success Peter Gassner CEO Veeva Systems Uses Improve Higher Education Fireside Chat Scott Dorsey Former ExactTarget Charles Thornburg Leverage Mobile Build Communities within Kevin Spain General Jeff Tangney Co-Founder Wins Panelists Moderator Gordon Ritter CapitalRob Craft Group Manager Google PlatformRoy Raanani Chorus.aiKieran Snyder TextioJaime Teevan Ph.D Principal Researcher Microsoft Research Go-To-Market Santi Subotovsky Pierre Naude nCino Jack Newton Clio Aaron Goldfeder EnergySavvy Jake Saper Ian Shakil Augmedix Steve Zahm President Procore Technologies Brian Patterson Gunderson Dettmer LLP

Sunil Rajaraman, SVP of Marketing at Replicon on Tackling Challenges as a Startup Moves Upmarket from SMB to Enterprise

June 1, 2017

Sunil Rajaraman SVP Marketing Replicon Emergence Partner Joe Floyd chat Sunil's path Founder Scripted.com current role late stage company highlights conversation include take different set challenges larger faces versus running smaller startup Insights leader moves upmarket SMB enterprise manage demand generation SDR teams scale internationally Qualities personality characteristics looks hiring team Check video listen podcast tips content scaling move

Zinc CEO Stacey Epstein on Transitioning from Sales/Marketing Executive to CEO

June 1, 2017

Zinc CEO Stacey Epstein sits Emergence Founding Partner Jason Green share story rising ranks Oracle SuccessFactors ServiceMax now talk shares perspective following topics made jump sales marketing executive Key challenges lessons learned career Advice founders first fundraising process including build syndicate new investors Tips female executives considering starting company Check video Stacey's listen podcast

Jason Green named Forbes Top 100 Venture Capitalists Midas List 2017

May 16, 2017

string exits propels Emergence Capital investor Jason Green onto Midas List capped ServiceMax's acquisition GE November 2016 1 billion December 2015 Salesforce acquired Steelbrick 360 million TouchCommerce August 215 Yammer July 2012 Microsoft 1.2 Aaron Levie's enterprise company Box went public Green's portfolio currently includes HR software Gusto performance management startup BetterWorks marketing xAd founding chairman Kauffman Fellows Program twin married see

Meet Mya: AI That Facilitates New Jobs Instead of Stealing Them

May 10, 2017

excited announce Emergence Capital's investment Mya Systems creator AI-recruiter intelligent assistant uses conversational AI transform application hiring experience candidates recruiters Less year launch captured industry's attention incredible customer growth user engagement Company positioned early market leader A-list customers including three world's largest recruiting agencies several Fortune 500 companies direct result coaching cloud thesis believe machine learning augment enterprise functions loops unique data already facilitated millions applicant conversations power proprietary set conversation resulting outcome continually improves Mya's natural language processing models ability support applicants learned mission realized true potential cost time savings help people find jobs better fit increase employee happiness retention reduce frictional unemployment helping faster impact families communities economies Ultimately forever change match employers entrepreneurs type world changing vision Eyal Grayevsky CEO James Maddox CTO attracted blend experienced SaaS veterans Eric LaBadie VP Sales Jay Murphy Success along cutting edge technologists spent team became right core revolutionize Capital aspire important partner share passion transforming business works truly exceptional opportunities proud work entire achieve

Emergence Capital named National Venture Capital Association's Venture Capital Firm of the Year!

May 9, 2017

Last night thrilled humbled named National Venture Capital Association's Firm Year first award ever given organization represents 80 active firms country credit rightly goes incredible entrepreneurs partners delivered amazing results years Peter Gassner Veeva Dave Yarnold ServiceMax David Sacks Yammer Godard Abel SteelBrick Aaron Levie Box Bernard Louvat TouchCommerce Eric Yuan Zoom name fortunate work built transformative companies moment worth reflecting Emergence 15th lofty ambitions core principles founded committed old fashioned investing early staying consistent reliable throughout journey matter outcome ambition become important partner defining future something earned time writing check Sometimes building iconic company takes okay Second beginning believed focused true areas competence investment Salesforce.com since kept eyes fixed firmly backing transforming investments SuccessFactors recent exit developed pattern recognition networks credibility area focus gives unfair edge stick circle every grows reach value impact Third play best team meaningful appreciate recognized efforts hard lonely business worked develop culture diversity backgrounds found commitment another produces better decisions frankly fun great industry zero sum game believe supporting growth entrepreneurship around world organizations Kauffman Fellows Endeavor creates opportunity Recently High Alpha Midwest attempt jumpstart entrepreneurial success region benefitted less opportunities ahead thank NVCA members honored member served Board Directors part toward fostering healthy ecosystem treasure fighting industry's behalf