15 Unicorn CEOs Chat on Clubhouse
Part 1: How to build a billion-dollar business
Clubhouse is the most recent social media app taking over the world. If you haven’t heard about it yet, you either haven’t been invited, or you’re an Android user, as Clubhouse is currently only available on iOS devices. Although the app is audio-only, it has rapidly exploded to 10 million users around the world, allowing ordinary people to join the same conversations as famous celebrities, business people, and influencers. It was on Clubhouse that we recently had the opportunity to listen in on a chat with the CEOs of 15 unicorn startups that were all accelerated by Techstars.
The hour-long Clubhouse “room” featured an open Q&A session with the CEOs, questions from the audience, and a summary of Techstars’ success with unicorns.
Quick Facts on Techstars’ Unicorns
We’ll start by sharing a few bullet points from Techstars founder, David Cohen.
- The Techstars accelerator launched in Boulder, Colorado in 2009, and has so far helped over 2,500 early-stage companies.
- Techstars has been involved in the birth of 15 unicorn companies.
- 12 of the unicorns came through Techstars on average at one per quarter (four annually).
- By 2015, Techstars had invested in 760 startups. 1 out of every 67 has since become a unicorn.
- Since it takes several years for a startup to reach unicorn status, there are likely 20–25 future unicorns yet to be discovered from the companies invested in since 2015.
Techstars is widely known as one of the top accelerators in the world. But still, this amount of success is astonishing. Now, if you’re curious to learn how the leaders of these 15 unicorns turned their startups into billion-dollar companies, continue reading.
Interviewing Unicorn CEOs
During the 1-hour open chat, the CEOs were all posed the same questions and allowed to share their opinions in an informal freestyle manner. What follows are the questions and the CEO’s replies.
Q1: “What does it take to build a billion-dollar business?”
CEO Digital Ocean — Yancey Spruili
“Well, a billion-dollar business essentially breaks down to about $150 million/year in revenue. The companies that are able to achieve this were able to get the product-market fit early and raise capital quickly. Normally when a company reaches 50 people everything needs to change. At that point, in order to grow, there needs to be a huge shift in focus and attention to processes, project innovation, and how decisions are made by the leadership team. The real magic required to become a unicorn happens when you can evolve and create the structure to scale, but also keep the same essence of the company that began with the founder.
When it comes to management, 25, 50, and $100 million revenue businesses are all very different. Management style has to change with growth. Often the heroes that help a company grow from $10–$50 million don’t scale well. The leadership team has to stay ahead of those changes. Product/market fit is necessary, but even more important is getting the talent market right in all the phases of growth.
Building a unicorn is all about 3 things:
- People — 2. Products — 3. Technology. In that order of importance.”
CEO SendGrid — Sameer Dholakia
“Becoming a billion-dollar company requires focusing on processes. When a startup is in its infancy everyone is doing everything to help the business succeed. It’s impossible to scale when everyone is wearing 6 different hats. If you don’t have processes things break down!
Having a great TAM is vital to becoming a unicorn! The problem you’re solving has to be broad enough and matter enough that people will pay for your solution. Your solution must be a NEED to have, not a WANT to have.
To be honest, a huge part of becoming a unicorn is luck! There are millions of things that are out of your control as CEO or founder that just need to perfectly align to become a unicorn.
CEO Chainalysis — Michael Gronager
“The 2 most important things to becoming a billion-dollar company are: Ambition + Talent!
If you’re ambitious enough and have the talent you will find the TAM you need to get there. With the right talent, you will grow the TAM to reach your goals in the smartest way possible.
Great talents see ambition but need to be attracted. Some experienced, great talent may be possible to attract early, but the majority can only be hired once you’ve reached unicorn status. Classic catch-22 situation! You need amazing talent to reach a billion-dollar valuation, but the really amazing talent is only interested in you after you’ve crossed that billion-dollar line.”
CEO SalesLoft — Kyle Porter
“Companies that become unicorns attach themselves to the RIGHT problem, not just a BIG problem. You need to ask yourself “Can I see myself waking up and solving this problem every day for the next 10 or 20 years?”. You’re going to need to obsess over your customer’s problem. A deep love of the problem will get you a long way and the company that cares about its customers the most is going to win. A huge sustainable differentiating advantage is a company that is in love with its customers.
Your vision and mission must be aligned, and you must have the talent, but at some point in the growth, the leadership is likely going to change as you scale. Some executives are only built for certain parts of the journey. Some leaders continue to grow while some will be replaced to get to the next level. It’s a hard lesson all scaling companies realize.”
CEO Owlet Baby Care — Kurt Workman
“One of the most important things about leadership is the ability to attract talent. Great founders need to be great recruiters when convincing the best people to join your team. You need to do everything you can to get the best people around you. That includes investors. Your investors are extremely important and need to be engaged in the process! It makes a huge difference in your success.
The 3 most important jobs of a good leader:1) Attract talent 2) Inspire talent 3) Coach”
Keller Rinaudo — CEO Zipline
“Almost all of the unicorns in the next decade will have extraordinary missions. The big tech companies are paying MBA-level salaries to attract the best new engineers. Startups will never be able to compete with those salaries! You’ll need to motivate great talent in other ways. Future potential unicorns will need to be inspiring and be part of building a brighter future for the world. That will be their secret weapon to attract the best talent. You won’t be able to confuse profit with purpose and still succeed.”
That’s the end of part one of our three-part series. If you enjoyed reading, follow us for the next installments where we’ll discuss “The Mission and Purpose of Unicorns” and “How to Deal With CEO Transitions.”
Are you on Clubhouse yet?
We’d love to connect with you. If you’ve already joined, please search for the club Startups in Korea. We’ll be planning weekly sessions to introduce startups to VCs, talk about news, and network with other people involved in the startup ecosystem.
