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1/ In 2013 people started to receive links over email to "find time" in someone's calendar vs. scheduling over email.
Calendly, the startup behind the links, raised $350 million at a $3 billion valuation led by OpenView a 2 weeks ago...
After only raising $550K!
How?
Calendly, the startup behind the links, raised $350 million at a $3 billion valuation led by OpenView a 2 weeks ago...
After only raising $550K!
How?
2/ Quick note. I can't stop thinking about the story behind Calendly, how it scaled and the VC "pattern recognition" alarms that should've been set off at the time if people decided to really dig into Tope's story, but everything is easier to spot in hindsight.
Let's dig in.
Let's dig in.
3/ First, we have to talk about Calendly's founder, Tope Awotona. Tope was born in Lagos, Nigeria, the third of four boys. He faced tragedy early on, as his father was killed when he was just 12 years old.
Childhood adversity.
Childhood adversity.
4/ Tope was always a good student even skipping a few grades in school in Nigeria. When his family moved to Marietta, GA, Tope considered going to college when he was just 15 years old, but his Mom thought he was too young.
Raw intellectual horsepower.
Raw intellectual horsepower.
5/ So, he did a few more years of high school, followed by college at the University of Georgia. After graduation, he held a few jobs selling enterprise software at companies like IBM and Perceptive Software.
Previous Tech Experience.
Previous Tech Experience.
6/ But Tope got the entrepreneurial bug. In his spare time, he worked on a few different e-commerce sites including a projector business and a grill business. Neither were great, but more importantly, he grinded, learned and took the leap.
Repeat Founder.
Repeat Founder.
7/ In late 2012, Tope was trying to schedule a meeting for work and realized just how much of a pain this process was. He got so inspired by this pain point that in 2013, he started building what would later become Calendly.
Personal Pain Point.
Personal Pain Point.
8/ This is where Tope challenged the "pattern recognition" of VCs. Why?
Because Tope does not have the traditional story of someone who would go on to raise $350 million at a $3 billion valuation.
Because Tope does not have the traditional story of someone who would go on to raise $350 million at a $3 billion valuation.
9/ Tope worked with a third-party firm to help build the initial platform because he couldn't find a technical co-founder.
Outsourced Development.
Outsourced Development.
10/ Founded in Atlanta, Tope had an almost impossible time raising from VCs. He pitched numerous VCs and got a "no" from pretty much everyone...He still mentions how some VCs even stood him up for calls and pitches.
11/ Tope had such a hard time raising money that he ran out of capital! He couldn't pay his outsourced engineers to build the billing functionality on the site, so he had to initially give his product away for free. Not by choice, but by necessity.
12/ @davidcummings, a prolific entrepreneur and investor in ATL Gems including Salesloft, Pardot and Terminus, turned out to be just the guy to give Tope money.
Calendly raised a $350K round then another $200K later, but that was the only capital before this recent mega-round.
Calendly raised a $350K round then another $200K later, but that was the only capital before this recent mega-round.
13/ So how did it grow?
Built for sharing.
Tope included an amazing viral feature in the product — the Calendly link. Users would send their own Calendly link to ask people to schedule a meeting. Recipients would then experience Calendly, serving as a genius viral loop.
Built for sharing.
Tope included an amazing viral feature in the product — the Calendly link. Users would send their own Calendly link to ask people to schedule a meeting. Recipients would then experience Calendly, serving as a genius viral loop.
14/ Organic Acquisition Engine.
As a result, Calendly grew organically, through people naturally sending Calendly links to others, who in turn signed up after having their interest piqued.
It's a beautiful thing when your users advertise on your behalf by using the product.
As a result, Calendly grew organically, through people naturally sending Calendly links to others, who in turn signed up after having their interest piqued.
It's a beautiful thing when your users advertise on your behalf by using the product.
15/ The results? A truly remarkable story.
Calendly was set to generate $70 million in recurring revenue with 20 million customers in 2020, and the company has been profitable since 2016.
So what can we learn from the Calendly story?
Calendly was set to generate $70 million in recurring revenue with 20 million customers in 2020, and the company has been profitable since 2016.
So what can we learn from the Calendly story?
16/ 1) In the era of mega-rounds and CVS receipt length funding announcements, it's important to note that not raising a boatload of VC is more than OK. If the fundamentals are there and you can find ways to generate cash, you can avoid dilution and still have a massive outcome
17/ 2) For consumer software products, focus on the flywheel + how to drive virality.
Ask yourself how can you get free advertising and acquire customers for free by simply having existing customers use the product. Calendly found an awesome hack, which helped its efficiency.
Ask yourself how can you get free advertising and acquire customers for free by simply having existing customers use the product. Calendly found an awesome hack, which helped its efficiency.
18/ 3) Diamonds are made under pressure.
Constraints can be good for businesses. Tope needed to get profitable quickly because he lacked capital. That probably paid off in the long run and helped him find a business model that worked quickly.
Constraints can be good for businesses. Tope needed to get profitable quickly because he lacked capital. That probably paid off in the long run and helped him find a business model that worked quickly.
19/ 4) There are many other takeaways here, but I'll end it with this.
As VCs, we need to do better. Tope couldn't raise capital, meanwhile, people far less deserving and with worse business mechanics did. I haven't met Tope, but damn he + Calendly check a lot of boxes.
As VCs, we need to do better. Tope couldn't raise capital, meanwhile, people far less deserving and with worse business mechanics did. I haven't met Tope, but damn he + Calendly check a lot of boxes.
20/ Shoutout to @GuyRaz for an awesome How I Built This episode with Tope from September. Check it out.
