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Extra Crunch roundup: Selling SaaS to developers, cracking YC after 13 tries, all about Expensify

Published May 14, 2021

Before Twilio had a market cap approaching $56 billion and more than 200,000 customers, the cloud-communications platform developed a secret sauce to fuel its growth: a developer-focused model that dispensed with traditional marketing rules.

Software companies that sell directly to end users share a simple framework for managing growth that leverages discoverability, desirability and do-ability — the “aha!” moment where a consumer is able to incorporate a new product into their workflow.

Data show that traditional marketing doesn’t work on developers, and it’s not because they’re impervious to a sales pitch. Builders just want reliable tools that are easy to use.

As a result, companies that are looking to create and sell software to developers at scale must toss their B2B playbooks and meet their customers where they are.

Attorney Sophie Alcorn, our in-house immigration law expert, submitted two columns: On Monday, she analyzed a decision by the U.S. Department of Homeland Security not to cancel the International Entrepreneur Parole program, which potentially allows founders from other countries to stay in the U.S. for as long as 60 months.

On Wednesday, she responded to a question from an entrepreneur who asked whether it made sense to sponsor visas for workers who are working remotely inside the U.S.

Thanks very much for reading Extra Crunch this week, and have a great weekend.

Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist

SaaS companies can grow to $20M+ ARR by selling exclusively to developers

4 lessons I learned about getting into Y Combinator (after 13 applications)

Image of a chair and a trash can in an office, with the bin surrounded by crumpled paper, representing persistence.

Image Credits: Peter Finch (opens in a new window) / Getty Images

Can you imagine making 13 attempts at something before attaining a successful outcome?

Alex Circei, CEO and co-founder of Git analytics tool Waydev, applied 13 times to Y Combinator before his team was accepted. Each year, the accelerator admits only about 5% of the startups that seek to join.

“Competition may be fierce, but it’s not impossible,” says Circei. “Jumping through some hoops is not only worth the potential payoff but is ultimately a valuable learning curve for any startup.”

In an exclusive exposé for TechCrunch, he shares four key lessons he learned while steering his startup through YC’s stringent selection process.

The first? “Put your business value before your personal vanity.”

4 lessons I learned about getting into Y Combinator (after 13 applications)

The Expensify EC-1

Image Credits: Illustration by Nigel Sussman, art design by Bryce Durbin

In March, TechCrunch Daily Reporter Anna Heim was interviewing executives at Expensify to learn more about the company’s history and operations when they unexpectedly made themselves less available.

Our suspicions about their change of heart were confirmed on May 3 when the expense report management company confidentially filed to go public.

With a founding team comprised mainly of P2P hackers, it’s perhaps inevitable that Expensify doesn’t look and feel like something an MBA might envision.

“We hire in a super different way. We have a very unusual internal management structure,” said founder and CEO David Barrett. “Our business model itself is very unusual. We don’t have any salespeople, for example.”

Similar to the way companies must file a Form S-1 that describes their operations and how they plan to spend capital, TechCrunch EC-1s are part origin story, part X-ray. We published the first article in a series on Expensify on Monday:

“How a band of P2P hackers planted the seeds of a unique expense management giant” (2,400 words/10 minutes) — Explores the founders’ days with a P2P content distribution startup called Red Swoosh (Travis Kalanick’s venture before Uber) and how that experience influenced Expensify’s development.

We’ll publish the remainder of Anna’s series on Expensify in the coming weeks, so stay tuned.

The Expensify EC-1

As Procore looks to nearly double its private valuation, the IPO market shows signs of life

Image Credits: Nigel Sussman (opens in a new window)

Construction tech unicorn Procore Technologies this week set a price range for its impending public offering. The news comes after the company initially filed to go public in February of 2020, a move delayed by the pandemic.

In March 2021, Procore filed again for a public offering, but its second shot ran into a cooling IPO market. The company filed another S-1/A in April, and then another in early May. This week’s filing is the first that sets a price for the Carpinteria, California-based software upstart.

But Procore is not the only company that filed and later put on hold an IPO to get back to work on floating. Kaltura, a software company focused on video distribution, also recently got its IPO back on track. Are we seeing a reacceleration of the IPO market? Perhaps.

As Procore looks to nearly double its private valuation, the IPO market shows signs of life

3 golden rules for health tech entrepreneurs

Close-Up Of Hand Showing Number 3 Against Red Background

Image Credits: Patcharin Saenlakon/EyeEm (opens in a new window) / Getty Images

Family physician Bobbie Kumar lays out the golden rules to ensure your healthcare product, service or innovation is on the right track.

Rule 1: “It’s not enough to develop a ‘new tool’ to use in a health setting,” Dr. Kumar writes. “Maybe it has a purpose, but does it meaningfully address a need, or solve a problem, in a way that measurably improves outcomes? In other words: Does it have value?”

3 golden rules for health tech entrepreneurs

Dear Sophie: How does the International Entrepreneur Parole program work?

lone figure at entrance to maze hedge that has an American flag at the center

Image Credits: Bryce Durbin/TechCrunch

Dear Sophie,

I’m the founder of an early-stage, two-year-old fintech startup. We really want to move to San Francisco to be near our lead investor.

I heard International Entrepreneur Parole is back. What is it, and how can I apply?

— Joyous in Johannesburg

Dear Sophie: How does the International Entrepreneur Parole program work?

Digging into digital mortgage lender Better.com’s huge SPAC

Image Credits: Nigel Sussman (opens in a new window)

If you have heard of Better.com but really had no idea what it does before this moment, welcome to the club. Mortgage tech is like pre-kindergarten applications — it applies to a very specific set of folks at a very particular moment. And they care a lot about it. But the rest of us aren’t really aware of its existence.

Better.com, a venture-backed digital mortgage lender, announced this week that it will combine with a SPAC, taking itself public in the second half of 2021. The unicorn’s news comes as the American IPO market is showing signs of fresh life after a modest April.

Digging into digital mortgage lender Better.com’s huge SPAC

As tech offices begin to reopen, the workplace could look very different

Colleagues in the office working while wearing medical face mask during COVID-19

Image Credits: filadendron (opens in a new window) / Getty Images

The pandemic forced many employees to begin working from home, and, in doing so, may have changed the way we think about work. While some businesses have slowly returned to the office, depending on where you live and what you do, many information workers remain at home.

That could change in the coming months as more people get vaccinated and the infection rate begins to drop in the U.S.

Many companies have discovered that their employees work just fine at home. And some workers don’t want to waste time stuck on congested highways or public transportation now that they’ve learned to work remotely. But other employees suffered in small spaces or with constant interruptions from family. Those folks may long to go back to the office.

On balance, it seems clear that whatever happens, for many companies, we probably aren’t going back whole-cloth to the prior model of commuting into the office five days a week.

As tech offices begin to reopen, the workplace could look very different

For unicorns, how much does the route to going public really matter?

4 progressively larger balls of US $1 bills, studio shot

Image Credits: PM Images (opens in a new window) / Getty Images

On a recent episode of TechCrunch’s Equity podcast, hosts Natasha Mascarenhas and Alex Wilhelm invited Yext CFO Steve Cakebread and Latch CFO Garth Mitchell on to discuss when companies should go public, the costs and benefits of the process and when a SPAC can make sense. Yext pursued a traditional IPO a few years back; Latch is now going public via a blank-check company combination.

The chat was more than illustrative, as we got to hear two CFOs share their views on delayed public offerings and when different types of debuts can make the most sense. While the TechCrunch crew has, at times, made light of certain SPAC-led deals, the pair argued that the transactions can make good sense.

Undergirding the conversation was Cakebread’s recent IPO-focused book, which not only posited that companies going public earlier rather than later is good for their internal operations but also because it can provide the public with a chance to participate in a company’s success.

In today’s hypercharged private markets and frothy public domain, his argument is worth considering.

For unicorns, how much does the route to going public really matter?

The truth about SDK integrations and their impact on developers

Image of three complex light trails converging against a white background to represent integration.

Image Credits: John Lund (opens in a new window) / Getty Images

Ken Harlan, the founder and CEO of Mobile Fuse, writes about the perks and pitfalls of software development kits.

“The digital media industry often talks about how much influence, dominance and power entities like Google and Facebook have,” Harlan writes. “Generally, the focus is on the vast troves of data and audience reach these companies tout. However, there’s more beneath the surface that strengthens the grip these companies have on both app developers and publishers alike.

“In reality, SDK integrations are a critical component of why these monolith companies have such a prominent presence.”

The truth about SDK integrations and their impact on developers

Don’t hate on low-code and no-code

Image Credits: Nigel Sussman (opens in a new window)

The Exchange caught up with Appian CEO Matt Calkins after his enterprise app software company reported its first-quarter performance to discuss the low-code market and what he’s hearing in customer meetings. To round out our general thesis — and shore up our somewhat bratty headline — we’ve compiled a list of recent low-code and no-code venture capital rounds, of which there are many.

As we’ll show, the pace at which venture capitalists are putting funds into companies that fall into our two categories is pretty damn rapid, which implies that they are doing well as a cohort. We can infer as much because it has become clear in recent quarters that while today’s private capital market is stupendous for some startups, it’s harder than you’d think for others.

Don’t hate on low-code and no-code

Bird’s SPAC filing shows scooter-nomics just don’t fly

A pair of Bird e-scooters parked in Barcelona. Image Credits: Natasha Lomas/TechCrunch

Historically — and based on what we’re seeing in this fantastical filing — Bird proved to be a simply awful business. Its results from 2019 and 2020 describe a company with a huge cost structure and unprofitable revenue, per filings. After posting negative gross profit in both of the most recent full-year periods, Bird’s initial model appears to have been defeated by the market.

What drove the company’s hugely unprofitable revenues and resulting net losses? Unit economics that were nearly comically destructive.

Bird’s SPAC filing shows scooter-nomics just don’t fly

Dear Sophie: Does it make sense to sponsor immigrant talent to work remotely?

Image Credits: Bryce Durbin/TechCrunch

Dear Sophie,

My startup is in big-time hiring mode. All of our employees are currently working remotely and will likely continue to do so for the foreseeable future — even after the pandemic ends. We are considering individuals who are living outside of the U.S. for a few of the positions we are looking to fill.

Does it make sense to sponsor them for a visa to work remotely from somewhere in the United States?

— Selective in Silicon Valley

Dear Sophie: Does it make sense to sponsor immigrant talent to work remotely?

The hamburger model is a winning go-to-market strategy

Follow the Hamburger model for your go-to-market strategy

Image Credits: ivan101 / Getty Images

“Today, we live in a world of product-led growth, where engineers (and the software they have built) are the biggest differentiator,” says Coatue Management general partner Caryn Marooney and investor David Cahn. “If your customers love what you’re building, you’re headed in the right direction. If they don’t, you’re not.

“However, even the most successful product-led growth companies will reach a tipping point, because no matter how good their product is, they’ll need to figure out how to expand their customer base and grow from a startup into a $1 billion+ revenue enterprise.

“The answer is the hamburger model. Why call it that? Because the best go-to-market (GTM) strategies for startups are like hamburgers:

The bottom bun: Bottom-up GTM.
The burger: Your product.
The top bun: Enterprise sales.”

The hamburger model is a winning go-to-market strategy

Software subscriptions are eating the world: Solving billing and cash flow woes simultaneously

Image Credits: belterz (opens in a new window) / Getty Images

Krish Subramanian, the co-founder and CEO of Chargebee, writes that while subscription business models are attractive, there are two major pitfalls: First, payment.

“Regardless of company size, there’s an ongoing need to convince customers to sign up long term,” Subramanian writes. “The second issue: How do businesses cover the funding gap between when customers sign up and when they pay?”

Software subscriptions are eating the world: Solving billing and cash flow woes simultaneously

Is there a creed in venture capital?

An illustration of Din Djarin from "The Mandalorian" by Aimee Blasee

Image Credits: Aimee Blasee (opens in a new window)

Scott Lenet, the president of Touchdown Ventures, asks how deal-makers should think about how to handle themselves when counter-parties attempt to change an agreement. “When is it OK to modify terms, and when should deal-makers stand firm?” he asks.

“Entrepreneurs and investors should recognize that contracts are worth very little without the ongoing relationship management that keeps all parties aligned. Enforcement is so unusual in the world of startups that I consider it a mostly dead-end path. In my experience, good communication is the only reliable remedy. This is the way.”

Is there a creed in venture capital?

Even startups on tight budgets can maximize their marketing impact

Maximize the impact of your marketing strategy

Image Credits: Ray Massey / Getty Images

“Search engine optimization, PR, paid marketing, emails, social — marketing and communications is crowded with techniques, channels, solutions and acronyms,” writes Dominik Angerer, CEO and co-founder of Storyblok, which provides best practice guidance for startups on how to build a sustainable approach to marketing their content. “It’s little wonder that many startups strapped for time and money find defining and executing a sustainable marketing campaign a daunting prospect.

“The sheer number of options makes it difficult to determine an effective approach, and my view is that this complexity often obscures the obvious answer: A startup’s best marketing asset is its story.”

Even startups on tight budgets can maximize their marketing impact

New Relic’s business remodel will leave new CEO with work to do

Published May 14, 2021

For Bill Staples, the freshly appointed CEO at New Relic, who takes over on July 1, yesterday was a good day. After more than 20 years in the industry, he was given his own company to run. It’s quite an accomplishment, but now the hard work begins.

On the positive side of the equation, New Relic is one of the market leaders in the application performance monitoring space.

Lew Cirne, New Relic’s founder and CEO, who is stepping into the executive chairman role, spent the last several years rebuilding the company’s platform and changing its revenue model, aiming for what he hopes is long-term success.

“All the work we did in re-platforming our data tier and our user interface and the migration to consumption business model, that’s not so we can be a $1 billion New Relic — it’s so we can be a multibillion-dollar New Relic. And we are willing to forgo some short-term opportunity and take some short-term pain in order to set us up for long-term success,” Cirne told TechCrunch after yesterday’s announcement.

On the positive side of the equation, New Relic is one of the market leaders in the application performance monitoring space. Gartner has the company in third place behind Dynatrace and Cisco AppDynamics, and ahead of DataDog. While the Magic Quadrant might not be gospel, it does give you a sense of the relative market positions of each company in a given space.

New Relic competes in the application performance monitoring business, or APM for short. APM enables companies to keep tabs on the health of their applications. That allows them to cut off problems before they happen, or at least figure out why something is broken more quickly. In a world where users can grow frustrated quickly, APM is an important part of the customer experience infrastructure. If your application isn’t working well, customers won’t be happy with the experience and quickly find a rival service to use.

In addition to yesterday’s CEO announcement, New Relic reported earnings. TechCrunch decided to dig into the company’s financials to see just what challenges Staples may face as he moves into the corner office. The resulting picture is one that shows a company doing hard work for a more future-aligned product map and business model, albeit one that may not generate the sort of near-term growth that gives Staples ample breathing room with public investors.

Near-term growth, long-term hopes

Making long-term bets on a company’s product and business model future can be difficult for Wall Street to swallow in the near term. But such work can garner an incredibly lucrative result; Adobe is a good example of a company that went from license sales to subscription incomes. There are others in the midst of similar transitions, and they often take growth penalties as older revenues are recycled in favor of a new top line.

So when we observe New Relic’s recent result and guidance for the rest of the year, we’re more looking for future signs of life than quick gains.

Starting with the basics, New Relic had a better-than-anticipated quarter. An analysis showed the company’s profit and adjusted profit per share both beat expectations. And the company announced $173 million in total revenue, around $6 million more than the market expected.

So, did its shares rise? Yes, but just 5%, leaving them far under their 52-week high. Why such a modest bump after so strong a report? The company’s guidance, we reckon. Per New Relic, it expects its current quarter to bring 6% to 7% growth compared to the year-ago period. And it anticipates roughly 6% growth for its current fiscal year (its fiscal 2022, which will conclude at the end of calendar Q1 2022).

Opportunity knocks: Exhibit at TC Sessions: Mobility 2021

Published May 14, 2021

No matter what slice of the mobility market you’ve claimed as your own — AVs, EVs, data mining, AI, dockless scooters, robotics or the batteries that will charge and change the world — you won’t find a better place to showcase your extraordinary tech and talent than TC Sessions: Mobility 2021.

Buy a Startup Exhibitor Package and virtually plant your early-stage mobility startup in front of a global audience that’s focused exclusively on one of the most complex, rapidly evolving industries. TC Sessions: Mobility, which takes place on June 9, features the top minds and makers, draws thousands of attendees, fosters collaborative community and creates a networking environment ripe with opportunities.

Pro tip: This package is for pre-Series A, early-stage startups only.

The Startup Exhibitor Package costs $380, and it comes with four all-access passes to the event. But wait (insert infomercial voice here), there’s more!

Your virtual expo booth features lead-generation capabilities. You can highlight your pitch deck, run a video loop and/or host live demos. Network with CrunchMatch, our AI-powered platform, to find and connect with the people who can help move your business forward. CrunchMatch lets you host private video meetings — pitch investors, recruit new talent or grow your customer base.

You’ll have access to all the presentations, panel discussions and breakout sessions, too. And video-on-demand means you won’t miss out.

Here’s a peek at just some of the agenda’s great programming you and, thanks to those extra passes, your team can attend — or catch later with VOD:

EV Founders in Focus: We sit down with the founders poised to take advantage of the rise in electric vehicle sales. This time, we will chat with Kameale Terry, co-founder and CEO of ChargerHelp! a startup that enables on-demand repair of electric vehicle charging stations.
Will Venture Capital Drive the Future of Mobility? Clara Brenner, Quin Garcia and Rachel Holt will discuss how the pandemic changed their investment strategies, the hottest sectors within the mobility industry, the rise of SPACs as a financial instrument and where they plan to put their capital in 2021 and beyond.
Driving Innovation at General Motors: GM is in the midst of sweeping changes that will eventually turn it into an EV-only producer of cars, trucks and SUVs. But the auto giant’s push to electrify passenger vehicles is just one of many efforts to be a leader in innovation and the future of transportation. We’ll talk with Pam Fletcher, vice president of innovation at GM, one of the key people behind the 113-year-old automaker’s push to become a nimble, tech-centric company.

TC Sessions: Mobility 2021 takes place June 9. Buy a Startup Exhibitor Package and set yourself up for global exposure and networking success. Show us your extraordinary tech and talent!

Is your company interested in sponsoring or exhibiting at TC Sessions: Mobility 2021? Contact our sponsorship sales team by filling out this form.

Every early-stage startup must identify and evaluate a strategic advantage

Published May 14, 2021

Mike Ghaffary
Contributor

Mike Ghaffary is a general partner at Canvas Ventures, where he invests in innovation for consumers and software. Previously, he was a partner at Social Capital, co-founder and VP of Business Development of Stitcher, VP of Business and Corporate Development at Yelp, and Director of Business Development at TrialPay.

5 ways to raise your startup’s PR game

Published May 14, 2021

Adam LaGreca
Contributor

Adam LaGreca is the founder of 10KMedia and previously led communications for DigitalOcean, Datadog and Gremlin.

Leverage your founders

This is especially important if you are a small startup that not many people know about. Journalists don’t want to hear opinions from your head of marketing or product — they want to hear from the founders. What problems are they solving? What unique opinions do they have about the market? These are insights that mean the most coming from the people that started the company. So if you don’t have at least one founder that can dedicate time to being the face, then PR is going to be an uphill battle.

That doesn’t mean there isn’t plenty to do to support these efforts. Create a list of all the journalists that have written about your competitors. Read those articles. How can your founder add value to these conversations? Where should you be contributing thought leadership? What are the most interesting perspectives you can offer to those audiences?

This is legwork and research you can do before looping founders into the conversation. Getting your PR going can be like trying to push a broken-down car up the road: If the founders see you exerting effort to get things moving on your own, they’re more likely to get beside you and help.

Here’s an example: It may be unreasonable to ask a founder to sit down and write a 1,000-word thought leadership piece by the end of the week, but they very likely have 20 minutes to chat, especially if you make it clear that the contents of the conversation will make for great thought leadership pieces, social media posts, etc.

The flow looks like:

You come up with topic ideas based on research.
The founder picks their favorite.
You and the founder schedule a 20-minute chat to get their thoughts on paper.
You write up the content based on those thoughts.

Deadline extended: Apply to Startup Battlefield at TC Disrupt 2021

Published May 14, 2021

When you’re head-down and nose to the grindstone — I’m looking at all you hard-working early-stage startup founders — it’s easy to miss a deadline for an outstanding opportunity. Case in point: competing in Startup Battlefield at TechCrunch Disrupt 2021 in September.

We want every game-changing, innovative startup — from anywhere around the world — to have a shot at massive exposure to investors, media and other influential unicorn-makers. The $100,000 in equity-free prizemoney would be nice, too, right? That’s why we’re extending our application deadline for another full week.

It won’t cost you a thing to apply or to participate, so don’t let this trajectory-changing opportunity slip past you. Apply to Startup Battlefield here before May 27 at 11:59 p.m. (PT).

The TechCrunch editorial team will vet every application and ultimately choose roughly 20 startups to go head-to-head. Each team receives weeks of free, rigorous coaching from our seasoned Battlefield team. Your pitch, presentation skills and business model will reach new heights of excellence. You’ll also be ready to deftly handle all the questions you’ll receive from our expert VC judges.

Startup Battlefield plays out over several rounds, with the field progressively narrowing. Each time you make the cut, you’ll repeat your pitch-and-answer session to a new set of judges. All that training, prep and focus leads to a final showdown and one last grab for the brass ring. And then it’s up to the judges to decide which stand-out startup wins the championship and that huge check.

11 words and phrases to cut from your VC pitch deck

While only one startup wins the money and the title, every team that competes benefits from standing in a global spotlight. Sean Huang, co-founder of Matidor, competed in Startup Battlefield at Disrupt 2020. His team was one of the five finalists. Here’s what he said about his experience:

“Going through Startup Battlefield helped us simplify and improve our pitch. It helped us not only with brand messaging, but also to win other pitch competitions after Battlefield. By pitching in the finals, we booked a demo with one of the final panelists. We received inbound investment interest from 12 Tier-1 investors, and eight potential key clients came to our website for a demo session. We also received an endorsement letter for our Y Combinator application from a fellow Battlefield participant, with whom we formed a great connection.”

You’re head down and focused — that’s why we’re giving you a one-week extension. So… stop, look up and grab this opportunity to take your startup to whole new levels. Get your nose off that grindstone and apply to Startup Battlefield here before May 27 at 11:59 p.m. (PT).

Is your company interested in sponsoring or exhibiting at Disrupt 2021? Contact our sponsorship sales team by filling out this form.

Edtech stocks are getting hammered but VCs keep writing checks

Published May 14, 2021

After years in the backwaters of venture capital, edtech had a booming 2020. Not only did its products become must-haves after schools around the globe went remote, but investors also poured capital into leading projects. There was even some exit activity, with well-known edtech players like Coursera going public earlier this year.

But despite a rush of private capital — which has continued into this year, as we’ll demonstrate — edtech stocks have taken a hammering in recent weeks. So while venture capitalists and other startup investors are pumping more capital into the space in hopes of future outsize returns, the stock market is signaling that things might be heading in the other direction.

Who’s right? One investor that The Exchange spoke to noted that market turbulence is just that, and that he’s tuning into activity but not yet changing his investment strategy. At the same time, the recent volatility is worth tracking in case it’s a preview of edtech’s slowdown.

The Exchange explores startups, markets and money.

Read it every morning on Extra Crunch or get The Exchange newsletter every Saturday.

Let’s look at the changing value of edtech stocks in recent months, parse some preliminary data via PitchBook that provides a good feel for the directional momentum of edtech venture capital, and try to see if there’s irrational exuberance among private investors.

You could argue that it’s public investors who are suffering from irrational pessimism and that private-market investors have the right of it. But since public markets price private markets, we tend to listen to them. Let’s go!

Falling shares

We’re sure that you want to get into the private-market data, so we’ll be brief in describing the public-market carnage. What follows is a digest of edtech stocks and their declines from recent highs:

Compared to its 52-week high, Chegg stock has lost over a third of its value.
After reaching $62.53 per share in April, Coursera has shed about half of its value and is trading close to its $33 IPO price.
2U closed at $33.92 per share yesterday, its shares also losing half of their value compared to their 52-week high.
Staying on that theme, Stride (K12) closed at $26.77 per share yesterday, which is about half of its 52-week high.

Cisco strikes again grabbing threat assessment tool Kenna Security as third acquisition this week

Published May 14, 2021

Cisco has been busy on the acquisition front this week, and today the company announced it was buying threat assessment platform Kenna Security, the third company it has purchased this week. The two companies did not disclose the purchase price.

With Kenna, Cisco gets a startup that uses machine learning to sort through the massive pile of threat data that comes into a security system on a daily basis and prioritizes the threats most likely to do the most damage. That could be a very useful tool these days when threats abound and it’s not always easy to know where to put your limited security resources. Cisco plans to take that technology and integrate into its SecureX platform.

Gee Rittenhouse, senior vice president and general manager of Cisco’s Security Business Group, wrote in a blog post announcing the deal with Kenna that his company is getting a product that brings together Cisco’s existing threat management capabilities with Kenna’s risk-based vulnerability management skills.

“That is why we are pleased to announce our intent to acquire Kenna Security, Inc., a recognized leader in risk-based vulnerability prioritization with over 14 million assets protected and over 12.7 billion managed vulnerabilities. Using data science and real-world threat intelligence, it has a proven ability to bring data in from a multi-vendor environment and provide a comprehensive view of IT vulnerability risk,” Rittenhouse wrote in the blog post.

12 top cybersecurity VCs discuss investing, valuations and no-go zones

The security sphere has been complex for a long time, but with employees moving to work from home because of COVID, it became even more pronounced in the last year. In a world where the threat landscape changes quickly, having a tool that prioritizes what to look at first in its arsenal could be very useful.

Kenna Security CEO Karim Toubba gave a typical executive argument for being acquired: it gives him a much bigger market under Cisco than his company could have built alone.

“Now is our opportunity to change the industry: once the acquisition is complete, we will be one step closer to delivering Kenna’s pioneering Risk-Based Vulnerability Management (RBVM) platform to the more than 7,000 customers using Cisco SecureX today. This single action exponentially increases the impact Kenna’s technology will have on the way the world secures networks, endpoints and infrastructures,” he wrote in the company blog.

The company, which launched in 2010, claims to be the pioneer in the RBVM space. It raised over $98 million on a $320 million post-money valuation, according to PitchBook data. Customers include HSBC, Royal Bank of Canada, Mattel and Quest Diagnostics.

For those customers, the product will cease to be standalone at some point as the companies work together to integrate Kenna technology into the SecureX platform. When that is complete, the standalone customers will have to purchase the Cisco solution to continue using the Kenna tech.

Cisco has had a busy week on the acquisition front. It announced its intent to acquire Sedona Systems on Tuesday, Socio Labs on Wednesday and this announcement today. That’s a lot of activity for any company in a single week. The deal is expected to close in Cisco Q4 FY 2021. Kenna’s 170 employees will be joining the Security Business Group led by Rittenhouse.

Palo Alto Networks to acquire Expanse in deal worth $800M

Substack acquires team from community consulting startup People & Company

Published May 13, 2021

New media poster child Substack announced today that they’ve added a small community-building consultancy team to its ranks, acquiring the Brooklyn-based startup People & Company.

The small firm has been working with clients to build up their community efforts, and its team will now be tasked with building up some of the newsletter company’s upstart efforts for writers in its network.

In a blog post, Substack co-founder Hamish McKenzie said that the company had previously used the People & Co. team to consult on their fellowship and mentorship programs and that members of the team would now be working on a variety of new efforts, from scaling programs to help writers with legal support and health insurance to community-guided projects like workshops and meetups to help crowdsource insights.

“These people are the best in the world at what they do, and now they’re not only working for Substack, but they’re also working for you,” McKenzie wrote.

Beyond Substack, previous partners with People & Company include Porsche AG, Nike and Surfrider.

Substack has been blazing ahead in recent months, adding new partners and raising cash as it aims to bring on more and more subscribers to its network. The firm shared back in late March that it had raised a $65 million round at a reported valuation around $650 million, according to earlier reporting by Axios.

Substack confirms $65M raise, promises to ‘rapidly’ expand its financial backing of newly independent writers

Is Substack really worth $650M?

Even startups on tight budgets can maximize their marketing impact

Published May 13, 2021

Dominik Angerer
Contributor

Dominik Angerer is CEO and co-founder of headless CMS Storyblok, which provides best practice guidance for startups on how to build a sustainable approach to marketing their content.

Search engine optimization, PR, paid marketing, emails, social — marketing and communications is crowded with techniques, channels, solutions and acronyms. It’s little wonder that many startups strapped for time and money find defining and executing a sustainable marketing campaign a daunting prospect.

The sheer number of options makes it difficult to determine an effective approach, and my view is that this complexity often obscures the obvious answer: A startup’s best marketing asset is its story. The knowledge and expertise of its team, together with the why and the how of its offering provides the most compelling content.

Leveraging this material with best practice techniques enables any startup, no matter how limited its budget, to run an effective marketing campaign.

Many startups make the mistake of choosing systems and employing procedures to solve the immediate needs of the department that requires them.

I know this approach works, because this is exactly what I did with my co-founder Alex Feiglstorfer when we set up Storyblok. To be clear, we are developers not marketers. However, our previous experience building CMS systems taught us that the main driver of organic engagement for most businesses was customer conversations around content.

Specifically, sharing experiences, expertise and what we learned. We had committed nearly all of our available cash to developing our product, so we knew that the only way to market Storyblok was to do it all ourselves.

As a result, we focused solely on problem-solving content. This took the form of tutorials on web development and opinion pieces on headless CMS and other topics within our areas of expertise. The trick was that what we published wasn’t made just for marketing, it was based on our own internal documentation of problems we encountered as we developed our product. In essence, we were “learning in public.” Through this approach we were able to acquire thousands of customers in our first year.

Retelling this story isn’t to blow my own trumpet, it’s to make clear that you don’t have to be a marketer by training or commit a huge amount of time and resources to successfully market your startup. So, how do you get started?

Getting your structure and technology right

Although there’s no one-size-fits-all approach to how you organize your startup’s marketing function, there are some basic principles that apply in nearly every situation. A recent survey of 400+ executives from CMS Wire helpfully identified the following factors as the “top digital customer experience challenges” for businesses:

Limited budget/resources.
Siloed systems and fragmented customer data.
Limited cross-department alignment/collaboration.
Outdated/limited technology, operations or processes.
Lack of in-house expertise/skills.

Challenges two to four are the pitfalls that we can focus on avoiding. They are directly related to how a startup produces, organizes and distributes its content.

With regard to the siloing of systems and fragmentation of customer data, the overriding goal is to ensure all your systems are integrated and speak to one another. In practice, this means that the data gathered in different departments — whether its feedback from sales, engagement on your website, customer service responses or product development information — is collected in a uniform and methodical manner and is readily accessible across the business.