The decision to start a company – or to join an early stage one – is an act of the gut. On good days, I see it as a quasi-spiritual commitment. On bad days, I see it as sheer irrationality. Whichever it is, you’ll be happier if you acknowledge and calmly accept the lunacy of it all...
In September of 1999, my first company, Rapt, concluded its Series A investment, led by Accel. Soon thereafter, I was invited to a CEO event hosted at Pebble Beach. Dana Carvey was the after-dinner entertainment. Caviar was served. All the captains of industry threw their champagne glasses in the air, utterly dazzled by themselves. Those were heady times, and at that moment, they only seemed to be getting better. Ariba indicated that they wanted to acquire us for $300M. What was my response as a first-time CEO whose company had just one customer and $200k in revenue? “Not a penny less than $400M.”
Fast forward several months and the dot-com bubble burst. The champagne and self-congratulation went bust along with it – as did the prospect of a quick exit. It sucked. It sucked more than anything had sucked before. But I had one vital thing going for me: I was too dumb to quit.
This might not sound like much, but it was everything when it came to navigating the torturous path ahead.
There were layoffs. First, a 10% headcount adjustment, which was not enough. Then 20%. Then 40%. We were wildly overbuilt. But in the times before the bust that was the way of things. Your VCs would ask, “Where’s the ramp?” Which was code for: hire more, grow faster. The same “blitzscale” advice doled out by VCs during the most recent bull market. Ultimately, we slimmed the company down from 140 people to 40.
We also had to recap. During that process, one of our key investors wrote his investment down to zero and walked away. In the land of venture capital, that’s not a divorce; it’s an annulment, a complete disavowal.
We frequently appeared on a then-popular gossip rag called Fucked Company which took great glee in trolling us. I took all of it very personally.
In 2008, we were acquired by Microsoft for $180 million. Nowhere near the $400 million that I breezily demanded seven years before, but 6x better returns than every other company that survived the downturn.
The correction we’re experiencing now is not the Dot Com collapse, but there’s a similar panic in the air among founders and VCs who haven’t yet seen a bear market like this one. There’s a lot of “downturn advice” out there -- perhaps too much from financiers who just a few months ago were urging founders to hire and happily marking up their portfolios in the process.. For entrepreneurs who are out there building, I salute you. And in case it’s useful, here are lessons we learned while building a company that survived the dot-com crash, starting another one during the Great Recession, and building and running companies today.
Silicon Valley is rife with pundits, posers and the chattering class who like to talk big but have never built anything consequential on their own. They take great glee, like Fucked Company did, in taking potshots and ridiculing entrepreneurs and teams who struggle. Listen to them if you must, but don’t let them get in your head – or in your way.
One of my key employees, Moishe, once came to me and told me very earnestly that we needed to go out to market and find someone who was mathematically sophisticated and able to lead our engineering team, but still comfortable and convincing with customers. I told him I agreed with his profile, but that person was already with us. I gave him a hint: his name rhymed with “Shmoishe.”
Outsiders who are famous aren’t as good as they and other market-watchers think they are. Sometimes you’ll need to go outside to find one, but more often than not the difference-makers who carry your company forward are hiding in plain sight – if you’re willing to recognize them, train and elevate them, and believe in their potential. We invest in active coaching, training, and mentorship for our employees still today, and the gains always outstrip the costs and time many times over. Invest in your homegrown unknowns, and commit to their growth through thick and thin.
We started Rapt as a supply chain optimization company offering pricing and procurement analytics for high tech manufacturers like Apple and HP. In 2003, we got a call from Yahoo, at the time an Internet juggernaut. “We’re constantly under and oversold on advertising inventory,” they said. “We think smarter pricing could make a difference. Can you help?” I didn’t know what ‘CPM’ stood for, but we said yes, got in there, and learned fast.
Yahoo became the hinge point, the fulcrum that helped us transition away from a dying space into a much larger, higher-growth opportunity in digital media. At the time, an investor took my CFO out for breakfast and told him, “Listen: you’ve got to get Chavez to focus. He’s chasing butterflies with this ad thing.” He might’ve been right. Maybe we just got lucky – but I really don’t think so. Never be afraid to course-correct. And, if needed, burn the boats.
You need the right people, product and customers – in that order. Together with the gritty employees that stood by us, we collectively smashed our heads against the wall to figure out the product pivot that helped us repot the company into a media monetization SaaS provider. We did the hard work of chasing down customers in a new industry totally foreign to us. It was one crucial, make or break play at a time until we accrued enough wins to turn it into a durable pattern.
Building a company, if you’re lucky, is a series of ‘3 steps forwards, 2 steps backwards.’ You’ll get kicked in the head more often than you get to pop champagne. But when you score a win, never let it slip through the cracks as if it were just another Tuesday. Cherish the wins, and celebrate them with your team.
It’s taken me a while to formulate what I call “The Entrepreneur’s Paradox”: To be a good entrepreneur, you have to see things as they are and not as you’d like them to be. Your decisions need to mostly be anchored on cold, hard facts and logic. But if you knew all the bad things that were going to happen to you – the sleepless nights, the mean-spirited rejections, the potshots, the Pepcids popped to calm your stomach – as a rational decision maker you’d never decide to launch and build a startup in the first place.
The decision to start a company – or to join an early stage one – is an act of the gut. On good days, I see it as a quasi-spiritual commitment. On bad days, I see it as sheer irrationality. Whichever it is, you’ll be happier if you acknowledge and calmly accept the lunacy of it all.
The Dot-Com crash left an indelible mark on me as an entrepreneur, a technologist and builder, and a leader. I don’t think I’m overtaken by nostalgia or foggy-eyed about any of it. When one of my companies wobbles, I still wake up at night in a cold sweat, worried about my baby, obsessing over what I need to do to nurture her along. These days, however, I quickly forgive myself for the inconvenience of waking up at 3:00 am. I smile and occasionally chuckle about the fact that I can still be so irrationally in love with something so obviously bad for my health.
I wake up, drink extra coffee in the morning, and my team and I press forward. We’re just too dumb to quit.
Transcript
In the first episode of The Closed Session, meet Tom Chavez and Vivek Vaidya, serial entrepreneurs and podcast hosts.
read moreIn the second episode of The Closed Session, Tom and Vivek discuss the framework for starting your own company from scratch, and the three dimensions that should be taken into account.
read moreYou’ve decided to launch a business, but before you hurtle blindly into the breach, you need a bulletproof plan and a perfect pitch deck to persuade your co-founders, investors, partners, and employees to follow you into the unknown.
read moreIn this episode of The Closed Session, Tom and Vivek talk about dilution, methods, mindset, benchmarks and best practices for raising investment capital for a new tech startup.
read moreNow that you've written the business plan and raised money, it's time to recruit your early team. In this episode, Tom and Vivek cover the do's and dont's of building a high-output team - who to hire, how to build chemistry and throughput, how to think about talent when your company is a toddler versus when it's an adolescent.
read moreWelcome to Season 2 of The Closed Session! In this first episode of 2020, Tom and Vivek talk about the five companies super{set} launched in 2019 and the lessons they’re learning as they go.
read more
Tom and Vivek talk about inclusion and reflect on their personal experiences as brown guys in tech. Inclusion feels like a moral imperative, but does it really make for stronger, better companies? Are there unintended consequences of acting on good intentions to 'fix' an inclusion problem at a company? Why is tech so lacking in diversity, and what can we do to get it right?
read moreWe are living in a time of extraordinary concern about the negative consequences of online platforms and social media. We worry about the damage interactive technologies cause to society; about the impact to our mental health; and about the way that these platforms and their practices play to our most destructive impulses. Too often, the experiences we have online serve only to polarize, divide, and amplify the worst of human nature.
read more
This post was written by Habu software engineer, Martín Vargas-Vega, as part of our new #PassTheMic series.
read moreThis post was written by Ketch Developer Advocate, Ryan Overton, as part of our #PassTheMic series.
read moreThis post was written by Ketch Data Privacy & Compliance Specialist, Jocelyn Brunson, as part of our #PassTheMic series.
read moreThis post was written by Ketch Sales Director, Sheridan Rice, as part of our #PassTheMic series.
read more
The super{set} studio model for early-stage venture It is still early days for the startup studio model. We know this because at super{set} we still get questions from experienced operators and investors. One investor that we’ve known for years recently asked us: “you have a fund — aren’t you just a venture capital firm with a different label?”
read more
This post was written by MarkovML Co-Founder, Lindsey Meyl, as part of our #PassTheMic series.
read moreWhere do the ideas come from? How do we build companies from scratch at super{set}?
read more
Coming up with new company ideas is easy: we take the day off, go to the park, and let the thoughts arrive like butterflies. Maybe we grab a coconut from that guy for a little buzz. While this describes a pleasant day in San Francisco, it couldn’t be further from the truth of what we do at super{set}. If only we could pull great ideas out of thin air. Unfortunately, it just doesn’t work that way.
read more
The wheel. Electricity. The automobile. These are technologies that had a disproportionate impact on the merits of their first practical use-case; but beyond that, because they enabled so much in terms of subsequent innovation, economic historians call them “general-purpose technologies” or GPTs...
read more
In our last post, we discussed how data is the new general-purpose technology and that is why at super{set} we form data-driven companies from scratch. But new technologies are a promise, not a sudden phase change.
read moreWhen a VC decides to invest in a company, they write up a document called the “Investment Memo” to convince their partners that the decision is sound. This document is a thorough analysis of the startup...
read moreThis post was written by Ketch Solutions Engineer, Sahiti Surapaneni, as part of our #PassTheMic series.
read moreWhat does it mean to be a super{set} co-founder and who do we look for? Why is the Head of Product the first co-founder we bring on board?
read more
Considered by some to be “America’s Second Independence Day,” Juneteenth has only recently entered the national zeitgeist. Celebrated on the third Saturday in June, it became a federal holiday just last year under President Joe Biden. Many companies are left wondering how to acknowledge the holiday. We sat down with Eskalera’s co-founder Dr. Tolonda Tolbert to get her take.
read more
Has someone looking to make a key hire ever told you that they are after “coachability”? Take a look at the Google ngram for “coachability” — off like a rocket ship since the Dot Com bubble, and it’s not even a real word! Coaching is everywhere in Silicon Valley...
read more
At super{set}, we stand side-by-side and pick up the shovel with our co-founders. Our first outside co-founder at a super{set} company is usually a Head of Product. Let’s unpack each portion of that title....
read more
Pankaj Rajan, co-founder at MarkovML, describes his Big Tech and startup experience and his journey to starting a company at super{set}.
read moreThe decision to start a company – or to join an early stage one – is an act of the gut. On good days, I see it as a quasi-spiritual commitment. On bad days, I see it as sheer irrationality. Whichever it is, you’ll be happier if you acknowledge and calmly accept the lunacy of it all...
read moreTom and Vivek describe how building the best product is like planning the perfect heist: just like Danny Ocean, spend the time upfront to blueprint and stage, get into the casino with the insertion product, then drill into the safe and make your escape with the perfect product roadmap.
read more
Tom and Vivek discuss what the very first customers of a startup must look and act like, the staging and sequencing of setting up a sales operation with a feedback loop to product, and end with special guest Matt Kilmartin, CEO of Habu and former Chief Revenue Officer (CRO) of Krux, for his advice on effective entrepreneurial selling.
read more
Reflections after a summer as an engineering intern at super{set}
read more
Gal Vered of Checksum explains his rationale for leaving Google to co-found a super{set} company.
read more
The era of easy money - or at least, easy returns for VCs - is over. Tom Chavez is calling for VCs to show up in-person at August board meetings, get off the sidelines, and start adding real value and hands-on support for founders.
read more
Tom and Vivek describe what the ideal CEO looks like in the early stage, why great product people aren’t necessarily going to make great CEOs, and what the division of labor looks like between the CEO and the rest of the early team. They then bring on special guest Dane E. Holmes from super{set} company Eskalera to hear about his decision to join a super{set} company and his lessons for early-stage leadership.
read more
o11y - What is it? Why is it important? What are the tools you need? More importantly - how can you adopt an observability mindset? Habu Software Architect Siddharth Sharma reports from his session at super{summit} 2022.
read more
Othmane Rifki, Principal Applied Scientist at super{set} company Spectrum Labs, reports from the session he led at super{summit} 2022: "When Inference Meets Engineering." Using super{set} companies as examples, Othmane reveals the 3 ways that data science can benefit from engineering workflows to deliver business value.
read more
Head of Infrastructure at Ketch, and Kapstan Advisor, Anton Winter explains a few of the infrastructure and DevOps headaches he encounters every day.
read moreTom and Vivek jump on the pod for a special bonus episode to call BULLSHIT on VCs, CEOs, the “categorical shit,” and more. So strap yourselves in because the takes are HOT.
read more
The Move Accelerates the Rapidly Growing Startup Studio’s Mission to Lead the Next Generation of AI and Data-Driven Market Innovation and Success
read more
Announcing Jon Suarez-Davis (jsd) as super{set}’s Chief Commercial Officer: jsd tells us in his own words why he's joining super{set}
read moreTom and Vivek describe the lessons learned from fundraising at Rapt in 1999 - the height of the first internet bubble - through their experience at Krux - amid the most recent tech bubble. After sharing war stories, they describe how super{set} melds funding with hands-on entrepreneurship to set the soil conditions for long-term success.
read more
Tom and Vivek have come full circle: in this episode they’re talking about closed session board meetings in The {Closed} Session. They discuss their experience in board meetings - even some tense ones - as serial founders and how they approach board meetings today as both co-founders and seed investors of the companies coming out of the super{set} startup studio.
read more
Arthur Patterson, founder of venture capital firm Accel, sits down for a fireside chat with super{set} founding partner Tom Chavez as part of our biweekly super{set} Community Call. Arthur and Tom cover venture investing, company-building, and even some personal stories from their history together.
read moreArthur Patterson, the founder of venture capital firm Accel, sits down for a fireside chat with super{set} founding partner Tom Chavez as part of our biweekly super{set} Community Call.
read more
This month we pass the mic to Sagar Gaur, Software Engineer at super{set} MLOps company MarkovML, who shares with us his tips for working within a global startup with teams in San Francisco and Bengaluru, India
read more
Arthur Patterson, legendary VC and founder of Accel Partners, sits down with Tom Chavez to discuss insights into company building. Tom and Vivek review the tape on the latest episode of The {Closed} Session.
read more
Chris Fellowes, super{set} interned turned full time employee at super{set} portfolio company Kapstan, gives his 7 recommendations for how to turn an internship into a job at a startup.
read more
Kicking off the fourth season of the {Closed} Session podcast with a great topic and guest: Frida Polli, CEO and co-founder of pymetrics, which was recently acquired by Harver, joins us to talk about the critical role that technology and specifically AI and neuroscience can play in eliminating bias in hiring and beyond.
read more
Obsessive intensity. Pack animal nature. Homegrown hero vibes. Unyielding grit. A chip on the shoulder. That's who we look for to join exceptional teams.
read more
Go-to-market has entered a new operating environment. Enter: RevOps. We dig into the next solution space for super{set}, analyzing the paradigm shift in GTM and the data challenges a new class of company must solve.
read more.jpg)
We are delighted to share our new episode of the {Closed} Session podcast with guest Alyssa Hutnik. Alyssa looms large in the privacy world, and she’s been thinking deeply about the intersections of data, technology and the law for nearly two decades. She’s also the Chief Privacy and Data Security Architect at Ketch, a super{set} company, as well as a lawyer. Hope you enjoy the episode!
read more
super{set} startup studio portfolio company’s seed funding round was led by Forerunner Ventures with participation from Ulu Ventures Raise will enable boombox.io to accelerate product development on the way to becoming the winning creator platform for musicians globally
read more
On the heels of boombox.io's $7M seed fundraise led by Forerunner, Tom Chavez and Vivek Vaidya sit down with boombox co-founders India Lossman and Max Mathieu for a special episode straight from super{summit} 2023 in New Orleans!
read moreAnnouncing Jon Suarez-Davis (jsd) as super{set}’s Chief Commercial Officer: jsd tells us in his own words why he's joining super{set}
read moreThe wheel. Electricity. The automobile. These are technologies that had a disproportionate impact on the merits of their first practical use-case; but beyond that, because they enabled so much in terms of subsequent innovation, economic historians call them “general-purpose technologies” or GPTs...
read moreo11y - What is it? Why is it important? What are the tools you need? More importantly - how can you adopt an observability mindset? Habu Software Architect Siddharth Sharma reports from his session at super{summit} 2022.
read moreThis post was written by Ketch Developer Advocate, Ryan Overton, as part of our #PassTheMic series.
read moreThis post was written by Ketch Data Privacy & Compliance Specialist, Jocelyn Brunson, as part of our #PassTheMic series.
read moreGal Vered of Checksum explains his rationale for leaving Google to co-found a super{set} company.
read moreChris Fellowes, super{set} interned turned full time employee at super{set} portfolio company Kapstan, gives his 7 recommendations for how to turn an internship into a job at a startup.
read moreThis post was written by MarkovML Co-Founder, Lindsey Meyl, as part of our #PassTheMic series.
read moreOthmane Rifki, Principal Applied Scientist at super{set} company Spectrum Labs, reports from the session he led at super{summit} 2022: "When Inference Meets Engineering." Using super{set} companies as examples, Othmane reveals the 3 ways that data science can benefit from engineering workflows to deliver business value.
read moreGo-to-market has entered a new operating environment. Enter: RevOps. We dig into the next solution space for super{set}, analyzing the paradigm shift in GTM and the data challenges a new class of company must solve.
read moreHas someone looking to make a key hire ever told you that they are after “coachability”? Take a look at the Google ngram for “coachability” — off like a rocket ship since the Dot Com bubble, and it’s not even a real word! Coaching is everywhere in Silicon Valley...
read moreThis post was written by Ketch Sales Director, Sheridan Rice, as part of our #PassTheMic series.
read moreThe Move Accelerates the Rapidly Growing Startup Studio’s Mission to Lead the Next Generation of AI and Data-Driven Market Innovation and Success
read moresuper{set} startup studio portfolio company’s seed funding round was led by Forerunner Ventures with participation from Ulu Ventures Raise will enable boombox.io to accelerate product development on the way to becoming the winning creator platform for musicians globally
read moreArthur Patterson, founder of venture capital firm Accel, sits down for a fireside chat with super{set} founding partner Tom Chavez as part of our biweekly super{set} Community Call. Arthur and Tom cover venture investing, company-building, and even some personal stories from their history together.
read moreThe super{set} studio model for early-stage venture It is still early days for the startup studio model. We know this because at super{set} we still get questions from experienced operators and investors. One investor that we’ve known for years recently asked us: “you have a fund — aren’t you just a venture capital firm with a different label?”
read moreHead of Infrastructure at Ketch, and Kapstan Advisor, Anton Winter explains a few of the infrastructure and DevOps headaches he encounters every day.
read moreThe decision to start a company – or to join an early stage one – is an act of the gut. On good days, I see it as a quasi-spiritual commitment. On bad days, I see it as sheer irrationality. Whichever it is, you’ll be happier if you acknowledge and calmly accept the lunacy of it all...
read moreWhen a VC decides to invest in a company, they write up a document called the “Investment Memo” to convince their partners that the decision is sound. This document is a thorough analysis of the startup...
read moreAt super{set}, we stand side-by-side and pick up the shovel with our co-founders. Our first outside co-founder at a super{set} company is usually a Head of Product. Let’s unpack each portion of that title....
read moreReflections after a summer as an engineering intern at super{set}
read moreThis post was written by Ketch Solutions Engineer, Sahiti Surapaneni, as part of our #PassTheMic series.
read moreConsidered by some to be “America’s Second Independence Day,” Juneteenth has only recently entered the national zeitgeist. Celebrated on the third Saturday in June, it became a federal holiday just last year under President Joe Biden. Many companies are left wondering how to acknowledge the holiday. We sat down with Eskalera’s co-founder Dr. Tolonda Tolbert to get her take.
read moreObsessive intensity. Pack animal nature. Homegrown hero vibes. Unyielding grit. A chip on the shoulder. That's who we look for to join exceptional teams.
read moreThis post was written by Habu software engineer, Martín Vargas-Vega, as part of our new #PassTheMic series.
read moreThis month we pass the mic to Sagar Gaur, Software Engineer at super{set} MLOps company MarkovML, who shares with us his tips for working within a global startup with teams in San Francisco and Bengaluru, India
read moreComing up with new company ideas is easy: we take the day off, go to the park, and let the thoughts arrive like butterflies. Maybe we grab a coconut from that guy for a little buzz. While this describes a pleasant day in San Francisco, it couldn’t be further from the truth of what we do at super{set}. If only we could pull great ideas out of thin air. Unfortunately, it just doesn’t work that way.
read morePankaj Rajan, co-founder at MarkovML, describes his Big Tech and startup experience and his journey to starting a company at super{set}.
read moreIn our last post, we discussed how data is the new general-purpose technology and that is why at super{set} we form data-driven companies from scratch. But new technologies are a promise, not a sudden phase change.
read moreThe era of easy money - or at least, easy returns for VCs - is over. Tom Chavez is calling for VCs to show up in-person at August board meetings, get off the sidelines, and start adding real value and hands-on support for founders.
read moreWe are living in a time of extraordinary concern about the negative consequences of online platforms and social media. We worry about the damage interactive technologies cause to society; about the impact to our mental health; and about the way that these platforms and their practices play to our most destructive impulses. Too often, the experiences we have online serve only to polarize, divide, and amplify the worst of human nature.
read more
