The Tenfold Turnaround Story: From $5m ARR, Flat, Burning $1m per Month to 100% YoY Growth

“understands how to run a business and and what to focus on because focus is key the investors can really give you a boost but if not it can be problematic so Andresen Horowitz LED and Ted folds series a the company had completed a b just before I joined which was led by next Coast Ventures here in Austin and those are the two primary investors The company took on a lot of seed Capital uh prior to the a by a lot of folks all throughout Texas the company was actually headquartered and based here in”

“were and actually many of those people actually were paid in our exit ultimately which was which was really critical the other thing I would tell you is unfortunately the company did have to do a reduction before I joined and I had to do one more but rest assured when I did mine it was the last one when you do these you've got to go as deep as you possibly can so the company was about 200 people before I joined I took it to 29 and that was at 5 million in Revenue we went down to 29”

“kind of general sales culture and I think in a startup you really have to be all over this you can't let people go a year I now run a 350 million dollar company and we let people go well over a year and that's not good practice but in a startup you got to do it I think every six months and if someone's not able to perform build Pipeline and show that they can produce you got to get new people in the last thing then that I want to just spend one more second on because I've said a lot about it but know the the demand generation model”

“ownership in that with my board and a couple of other advisors where we would quarterly have a a strategic planning session to sort of look at the metrics of the business what we thought valuation really really was not just what some math model is telling you what's going on in the market who are the potential exits uh Etc so that we were just constantly keeping an eye on that now in our business maybe very different than some of what you all are dealing with but because we went with a”

“upside so I asked our board uh maybe more like demanded our board and they supported a complete recap of the company so that would be something that if you're facing that type of a situation I would absolutely make sure that you're thinking about how can you recap all of your employees which are really important so that everyone can win and look we we also were successful at getting fifty percent of the company back in the hands of the employees you can imagine raising three rounds of capital now with the types of valuations”

“TenFold Cash Burn Silly Reasons We Were Burning $1.5m/mo Why? 2018 Monthly operating expense avg of $1.5M vs $450K monthly revenue No focus on core product and business…we were b2b contact center and spending on crypto projects and features that were too future leaning Monthly sales expense was 2x revenue No success based KPIs to release incremental investment”

“How to fire without pissing them off… Tell people why: You’re equity won’t be worth anything if we don’t do this. CEO must own the layoff, paint picture for future. Re-build brick by brick. Do not layoff multiple times, 1 big time better than several small cuts. Team size 200 people 29 people”

“Average Deal Size Growth $1M Quota $200k $4M Quota Inside Sales Rep Outside Sales Rep $300k If sales reps don’t hit targets after 6 months, release them. Build financial operating targets 1 quarter in advance. Know demand model. We pivoted to partners like Nice InContact Align product investment with revenue Expand existing customers obsessively. Low CAC. Cut down vendor spend. Spreadsheets work most of the time.”

“How We Thought About Exiting Never discussed exit w/ team. Focused on sustainability. Our Strategic Exit Council OEM’s were perfect buyers Hyper focus on Rule of 40 OEM’s started to ask about buying LivePerson gave us an unsolicited offer “Companies are bought not sold”!”

“$34.5m in VC: We had raised a lot to hit $10m+ in ARR Returned more than 2x what we raised: Got market leading revenue multiple exit and 2-5X multiple of invested capital (MOICs) for investors Down Round: I got board support to reset all FTE’s equity in down round. Very important. Employees Win: They had just shy of 50% of the company at equity. Negotiating a Deal for Everyone to Make Money”