Category Archive: Migrating to US

Founder’s Perspective: ForgeRock co-founder Lasse Andresen on His Company’s Journey to the U.S.


When Lasse Andresen left his position as Sun Microsystems’ CTO of northern Europe in February of 2010 to found open source identity software company ForgeRock, the native of Norway, did so with an eye toward a big opportunity in the U.S. market.

Around that time, enterprise cloud and mobile adoption were exploding, and many companies were increasingly dealing with identity management and security issues.

“We were a very traditional European company, building the business block by block with early customers in our home market, but we knew from day one that the product we were building had significant applicability to U.S. enterprises,” Lasse recalled during a recent conversation. “There wasn’t really a U.S. market leader in the space we were operating in, so our founding team understood that we’d be crazy not to ultimately move in that direction.”

So, just two years after founding the company in Norway, Lasse and his fellow co-founders decided to pull the trigger — relocating the business from Oslo to San Francisco.

Recently, I had the opportunity to talk to Lasse about that move, the challenges/opportunities it presented, and what fellow European entrepreneurs could learn from ForgeRock’s experience. Below is a transcript of that call.

Firas: You mentioned that migrating to the U.S. was on your team’s mind from the beginning, but how did you know it was the right time to make the move?

Lasse: It really stemmed from our knowledge of the U.S. market. We saw an opportunity in the U.S. market and we knew that in order to capture it we needed to act fast. Of course, in order to do that, we needed money.

We’d bootstrapped the business initially and the organic growth was great, but that growth often happens too slowly to capitalize on the type of opportunity we were pursuing. To execute the transition we wanted to execute, we needed a sponsor in the U.S. that had specific skills or knowledge about the market we were entering and the capital resources that could help us make the jump. We found that sponsor in Accel Partners, and that partnership ultimately facilitated our migration to the U.S.

The bottom line is that there was a ceiling on how big we could grow in Norway. But by agreeing to the deal with Accel and relocating to the U.S., that ceiling grew exponentially.

FIRAS: When you first began seeking outside investment, what was your experience?

LASSE: Thankfully, the interest in our company was huge. We were talking to investors in Norway, the United Kingdom, and the United States, and the attitude in each market was very different.

In Norway, for instance, investors very much believe in a slower paced, stone-by-stone approach to building companies. The concept of stepping on the gas to quickly scale a company is totally foreign to them. The attitude in the U.S. was totally different. U.S. investors recognized trends in cloud computing, security, and mobile, and saw a company with a proven product and an amazing team with a great track record.

In the end, we came away with six term sheets, and we signed with Accel because they really aligned with and bought into our vision. They understood that there was risk in investing in a European startup, but they didn’t try to drown us in spreadsheet risk management and diligence like many of the European investors were. For me, that showed that they really understood and shared our vision.

FIRAS: What did the Accel investment ultimately help you do?

LASSE: It enabled us to execute our vision with better efficiency and effectiveness.

The reality was that the talent and customer pools in the U.S. were significantly larger than our home country, and there were fewer roadblocks to closing deals being an American company vs. being a Norwegian company.

Frankly, we weren’t having trouble pitching our product to American buyers, but we were running into trouble in the procurement department. There’s just a lot of uncertainty that surrounds U.S. businesses buying technology from a small Norwegian company. It raises all sorts of red flags in the purchasing process. So, when we were headquartered in Oslo, we might be able to convince U.S. customers that we had the best product for them, but the process often stalled when it came time to convince purchasers to actually close the agreement.

As soon as we became an American company, 200 questions were immediately answered for those purchasers and it made the process of closing deals much faster and efficient.

Firas: I know you built a U.S. development team early on, but when did you officially start U.S. distribution? Was that pre- or post-funding, and what was your experience there?

Lasse: We began selling into the U.S. market pre-funding, but we were selling remotely and it just didn’t work. If you want to have any success selling to U.S. customers, you need to be here.

The first two years, we didn’t have any funding to build a sales team in the U.S., so we did the best we could — booking cheap flights back and forth, working at night in Europe to address the difference in time zones, etc. It took a toll on our team and it wasn’t effective. We knew that we needed to be on the ground. People still buy from people, and the continuity in your sales process breaks down if you’re only in the U.S. every few weeks.

So, that’s what we used some of our funding to do. We built a team in our San Francisco office that mirrored the one we had on the other side of the Atlantic. That way, we could execute autonomously without needing to share resources, yet there was still continuity and consistency between offices.

FIRAS: As the CEO, how did you manage wearing two hats during the move to the U.S., and when did you ultimately decide that it was the right time to pass the baton off to (current ForgeRock CEO) Mike Ellis?

LASSE: To answer your first question, the only way to survive bouncing back and forth across the Atlantic is to marry the best woman in the world. Seriously though, if you’re family or personal life isn’t stable or your family isn’t supportive of the move, I’d strongly advise against starting a journey like this.

Your family has to be on board, or you won’t be able to commit yourself fully. You have to be willing to go all-in, or nothing will go as fast as you need it to and growth will only occur incrementally. So, from day one, you need to accept that a move to the U.S. will require five years of your life. If you’re not willing to invest that, then you shouldn’t do it.

As for your second question, I don’t think European founders always need to step down as the CEO, but I do think it’s important to understand the lifecycle of the company and whether your skillset translates to the stage you’re entering.

Typically, the characteristics of founding CEOs are very different than those possessed by CEOs of companies with 200+ employees. Those two jobs just require a very different skillset. So I’d advise every startup founder to figure out what they’re best at and determine whether that skillset will scale. If it won’t, you have to do what’s best for the company.

FIRAS: Looking back over the two years since you moved, are there some lessons you’ve learned or mistakes you wouldn’t make again?

LASSE: I think the biggest thing for other European entrepreneurs to know is that if you want to start a global company, consider starting in the U.S. from day one.

We spent a lot of time and money on the transition from Oslo to San Francisco, and it created a lot of insecurity in our Series A round. Being an international company raised a few red flags for some investors, and then there was the issue of talent. There’s nothing wrong with Norway. It’s my home and I think there’s a lot of talent there. But if your goal is to be a big, international company, the U.S. just provides so much more of the resources you need.

So, my advice would be to just jump right in. From a pure registration perspective, it’s easier to set up a company in the U.S., and creating the right structure from day one is really important. If you know what the end goal is, it’s best to architect your plan with that goal in mind.

FIRAS: Anything else that presented a particularly significant barrier to U.S. migration?

LASSE: We haven’t talked about culture yet, but I think that’s extremely important.

When you’re an international company hiring your first U.S. team, it’s critical to find people who are culture-aware or have experience working internationally. The reality is that you’re always going to have international roots or ties. As such, your employees — particularly your senior leaders — on both sides of the Atlantic must be able to manage those cultural differences, or your business will suffer.

European Founder’s Perspective: A Q&A with Mendix Founding CEO Derek Roos


When I created this blog, my singular goal was to bring fresh insight into the unique challenges (and opportunities) that international software companies face when they begin their migrations to the United States.

Recently, I had a conversation with Derek Roos, co-founder and CEO of Mendix, a cloud-based app platform for large enterprise customers that just recently announced the closing of its Series B round of financing (landing $25 million from Battery Ventures and other investors).

Though Mendix has now successfully transitioned from the Netherlands to the United States, I wanted to pick Derek’s brain about the unique challenges he faced as he migrated Mendix across the Atlantic, as well as how he knew the company was “ready” for that transition and which lessons he’d share with other international entrepreneurs in the same position.

Firas: First off, congratulations on the big news! To get us started, can you walk us through how you decided initially to move to the United States, and which factors led to that decision?

Derek: Thanks, Firas. It’s been a crazy few months, but we’re thrilled with the opportunity we have in front of us.

As for our decision, I can honestly say that migrating to the U.S. was part of our vision from the beginning. We always had the ambition to be a leader in the enterprise marketplace, and to do that we had to be in the U.S.

We also knew that to be successful in our market, we needed a pretty complete story and product. So, we started in Europe to prove our concept and validate the demand, and we took a few years to get everything ready. But as soon as we felt we had everything in order, we took the jump.

Firas: What’s the definition of ‘ready’?

Derek: That’s a good question, and I think it probably depends on the unique circumstances of each company. But at a high level, I think focus is critical. It’s easy to drown in a market as big as the United States if you aren’t sure which customer segments you should be targeting, or which team members you need to recruit.

At Mendix, we felt we were ready when we could confirm two key things. First, we could identify and had a good feel for the target market and the personas we were going after. Second, our product was proven and engineered in a way that would work in the U.S. enterprise market.

Another factor to consider is whether you have sufficient capital resources to make the move. That wasn’t the case for us when we made the move, but it’s something I’d advise other entrepreneurs to consider.

Firas: How did you manage the dynamics of the whether the founding team would move with the company, or whether you’d hire someone else to run the U.S. operations?

Derek: We executed a two-phased approach.

Phase 1 kicked off before our Series A round of financing. At that point, we felt it was important to put someone on the ground in the U.S., so we hired a local guy in Boston to do some exploratory work. We wanted this person to find our first few customers to get a feel for the market, which allowed the founding team to maintain operations in Europe and pay attention to that market. During that period, we landed a few key customers and we learned a lot about ourselves in the market. It also helped us land our A round.

Phase 2 started with a simple goal — raise some capital and spend it on accelerating growth, rather than figuring out where we fit into the U.S. marketplace. A few weeks after that A round, I moved to the U.S. full-time and I’ve been based here ever since.

Firas: So, do European founders need to spend a year or more in the U.S. — prior to moving their companies here — to learn about the market, customer needs, and buyer dynamics? What were some of the differences you found or learned in that year?

Derek: Yes, I do think that’s important. You need at least a year to figure those differences out. That’s particularly true in the enterprise market, where you need much closer contact with customers than in other smaller markets.

As for what I learned in that first year, I think there were two big lessons.

First, you have to be much more focused on a subset of the market than back home. The U.S. enterprise market is homogeneous, but it’s also huge. You can’t possibly attack it all at once. You have to be much more focused, not just on a vertical industry, but also on sub-industries. And you have to learn as much as you possibly can about those markets.

Second, if you think the way you sold your product to buyers in your home country will translate to the U.S., you’re wrong. In Holland, it was easy for us to jump in the car and go visit a customer. In the U.S., you can’t do that. You have to set up a sales force and you need to understand all of the unique processes and challenges associated with that.

Firas: Then there’s the challenge of making your first hire. Who do you hire? An entrepreneur? An experienced sales executive? It’s a tough question to answer. How did you guys approach that situation?

Derek: For us, we made one of our founders our “first hire.” Sure, you can hire someone else to explore the market for you and determine the sales methodology that makes the most sense. But there are two disadvantages to that approach: first, that first hire will have a massive disadvantage of being a new employee in a new market thousands of miles away from the company headquarters where all the knowledge is contained. Second, as that first hire engages with prospects and partners in the US, much is lost in translations as he communicates the findings back to the founders, and hence you miss the “local feel” of the market.

I think it makes a lot of sense for one of the startup founders to move to the US first and experience firsthand the unique challenges and opportunities of that market. A lot of times, there’s nuance that you can only see if you’re in the middle of it. So, the first guy on the ground should be the founding CEO of the company, and he should be the first salesperson, too. You have to go out, meet customers, sell, and learn about your market.

Firas: How does that affect the way the company is managed in its home country?

Derek: It can definitely have a negative impact if you don’t manage it properly. I put a manager in place to take over my day-to-day responsibilities in Europe. You obviously won’t find out if someone can handle that job until you’re gone, but that approach worked for us. We had the benefit of a strong core team staying in Europe, as well, so it wasn’t as stressful as it could have been.

Firas: You talked a little bit about funding earlier. You started with European investors initially (Prime Ventures in Amsterdam), and you’ve since secured the Series B round through U.S. investors. What are some takeaways from both of those experiences?

Derek: Maybe things have changed over the course of the last few years, but I think one of the biggest challenges for European companies is getting U.S. investors’ attention when you don’t have any presence in the U.S. market.

We definitely experienced that with our Series A. The bottom line is that it’s easier for U.S. investors to work with U.S.-based companies that are known commodities. European companies might be able to get proposals and interest from U.S. investors, but they’re not necessarily going to be as good as they would be if the company was based in the U.S.

Firas: Obviously, that has a lot to do with risk. If a company has already made the transition to the U.S., there’s less uncertainty about the costs and challenges associated with an international move.

Derek: Absolutely. What I’d suggest European companies do is spend time understanding the U.S. market and how they’re going to approach it, and then identify the VCs that share your vision for the business. Whether those investors are in the U.S. or not doesn’t matter as much as whether they understand and support your expansion plans. In other words: Look for fit first, and then worry about capital and terms.

Firas: Agreed. Fit and an aligned vision are critical in any investor-investee relationship. Once you’re confident in those things, capital obviously matters — particularly because many international founders underestimate the cost of transitioning to the U.S. So, how can you ensure you have enough money to move to the U.S.?

Derek: It’s definitely expensive, but we expected that when we started. Thankfully, we were bootstrapped for the first five years of our existence. So, we knew how to manage money in ways that would return our investment quickly.

That being said, I could see how it could get out of control and catch companies off guard. Then again, if your spending gets out of hand, it almost doesn’t matter how much capital you get from an investor. That’s indicative of a different problem entirely.

Firas: True. Thanks again for taking the time to share your experience, Derek. And best of luck moving forward!

Derek: Thanks, Firas!

5 Myths About Migrating a Software Company to the US


creation-myth-cave-art-cartoonThe last decade has been very kind to a handful of high profile, very successful international B2B software companies.

For instance, Zendesk, an enterprise customer service software company that was founded in a small loft in Copenhagen in 2006, has received more than $80 million in funding since relocating its headquarters to the United States. Oh, and it’s projected to hit the $100 million annual revenue plateau in 2014, a big step toward a potential IPO.

Then, of course, there’s Huddle, the cloud-based collaboration and content management platform that was founded in London in 2006. Since establishing headquarters in the United States in 2012, the company has raised a $24 million venture round and begun to eye its own IPO in 2014 (with a projected valuation north of $1 billion, by the way).

I could rattle off countless other success stories (and I’m sure you could come up with a few others on your own), but the truth is that those successes have clouded the harsh reality of most U.S. migrations: For every Zendesk or Huddle, there are numerous other international startups that fail miserably when they attempt to re-locate to the land of opportunity.

Does that mean that moving an international B2B software company to the U.S. is a bad idea?

Absolutely not. The problem, however, is that entering the U.S. market isn’t as easy as it looks (even if you’ve already built a successful company in your home country). Making matters worse, many international founders and CEOs often get tripped up by the allure of five very misleading myths about the U.S. market:

Myth #1: International companies must set up shop in Silicon Valley

Ah, yes, the old “Silicon Valley is the only place to be” argument. Is it true that Silicon Valley is home to a host of brand-name investors, successful tech giants, and a seemingly endless pool of tech talent? Sure. But Silicon Valley has some inherent disadvantages for international B2B software companies, too. For instance:

Silicon Valley is may not be where your prospects are: the primary allure of the Valley is that it is a hub of tech investors, talent, and strategic acquirers. But it is not the hub of your prospect clients. The nice thing about being a B2B company is that you can have many areas of concentration when it comes to your future customers. New York, Boston, Chicago, Dallas to name a few, where you would not only find customer concentration but also find really good talent. Not to mention Salt Lake City (think Omniture, and two of my portfolio companies AtTast and Instructure) and Austin (BazaarVoice, Spredfast).

 It’s further from your home country: Let’s say that you’re the founding CEO of a software company that’s headquartered in Berlin. If you relocate your business to San Jose, California, then you’re looking at almost 14 hours of travel time each way (plus a 9-hour time change). If, on the other hand, you headquartered your business in New York, your travel time would be about nine hours and you’d also gain three hours of time change, not to mention saving about $500 on airfare. Those differences can equate to a lot of time and money

 The cost of talent and real estate: To headquarter your company in Cupertino, California, you’re going to pay a significant premium for office space and engineering or sales talent, versus if you headquartered your company in Raleigh, North Carolina (a burgeoning tech hub). Is that premium really worth paying just to boast that Apple is one of your corporate neighbors

Myth #2: The U.S. market is totally homogeneous

On the surface, I understand this misconception. After all, the U.S. has a single language, currency, set of laws, and procurement habits, and its culture is mostly unvaried. But the U.S. is also a massive piece of land that is so geographically dispersed that it’s virtually impossible to treat it as one single market.

Moving your company from Denmark to the US is like going from fishing in a lake to fishing in an ocean. You’re boat is too small, your tackle is limited, the fish stick is different, and the space you’re fishing in goes from small to massive.

Entering the U.S. from your smaller home country presents similar challenges. Yes, the U.S. has a large market of mostly homogeneous buyers. But because of that market’s sheer size and geographic dispersal, it’s virtually impossible to target the entire market all at once. If you do so, you’ll probably find that you don’t have the time or resources to survive for very long.  Careful capital-efficient entry with careful expansion and ample funding are the keys to success.

Myth #3: You need to locate your company close to your prospective buyers.

This is generally a European mentality and it goes back to my point above. The beauty of the United States is that there are probably customers for your product in whichever city you decide to call home. Will there be more of those customers in Northern California, New York, or Boston? Maybe. But, unlike Europe, U.S. businesses are not contained to just one or two major markets. So, wherever you decide to set up shop, it’s likely that you won’t capture anywhere near the majority of your prospective buyers anyway.

For that reason alone (and because U.S. companies are more open to buying software over the phone), it doesn’t really matter where you set up your company when you re-locate to the U.S. The more important thing to focus on is the geographic concentration of the talent you need to hire, because that’s the factor that will have a greater impact on your ability to successfully establish U.S. operations.

Myth #4: The first person you hire in the U.S. needs to be a senior salesperson.

All too often, I’ve seen international startups make the mistake of beginning their migration to the United States by hiring a senior sales manager who has never had experience building and managing a team. From there, the company often gives that person a VP of Sales title and then uses that person to experiment with their U.S. sales model.

That approach is like putting the cart before the horse.

In my experience, international software companies need to do three things before they ever hire the person who will lead their U.S. sales organization:

  1. Figure out the segment they’ll be targeting in the US
  2. Determine the distribution model they’ll use to sell and market the software
  3. Experiment with that model until it’s been validated

At that point, your company should have a clear understanding of the skills and experience a prospective sales leader needs to have to successfully build and manage your sales team with that model in mind. Then (and only then) should you search for and recruit the person who will lead your U.S.-based sales operation.

Myth #5: It will cost you $2-3 million in funding to get U.S. operations started.

Double that number, and you might be close to the final tab of migrating to the United States.

Truthfully, whatever you think it’s going to cost you to move your international company to the U.S., it’s generally a good idea to assume it will cost twice as much. The reasons for that are simple: The U.S. is huge, it’s geographically dispersed, there’s significantly more competition than your home country, and it will likely take significant sales and marketing effort to rise above the clutter, reach your prospects, and convert them into revenue.

Additionally, because you’ll be paying less attention to your home country to set up shop in the United States, you’ll probably end up spreading yourself thin — and that will negatively impact operations in both locations. As a result, you have to be prepared to allocate more resources to entering the U.S., give yourself more time to generate revenue, and understand that you’ll make mistakes that you may not have made in your home country.

The Bottom Line: Migrating to the U.S. May be Smart, but it’s No Walk in the Park

With all of that said, I’m in no way trying to discourage international B2B software companies from moving to the United States. In fact, as I wrote in a previous post, for most B2B software companies it’s often a requirement to eventually set up shop in the U.S.

What I am saying, however, is that it won’t be an easy transition and I’d recommend against focusing too much on successful international B2B companies like Zendesk, Huddle, Acronis, and others. Those companies, quite simply, are often outlier success stories.

Instead, I think you’d be better off studying the failures of international B2B software companies that didn’t survive. Those failures can be used as a playbook to avoid common mistakes or misconceptions (like the ones above), and ensure that your business has the proper focus and resources necessary to maximize the probability of success.

Coming to America


coming to america

Five years ago, the vast majority of successful business-to-business (B2B) technology startups came from one of the major hubs in the United States — be it Silicon Valley, Seattle, New York, Boston, or another emerging region of the country like Salt Lake City.

Today, a lot has changed.

In fact, I recently read a report by global telecommunications firm Telefonica that revealed this nugget: Today, five of the biggest hubs for startup output now fall outside of our cozy domestic borders — Tel Aviv (#2), Sydney (#5), Toronto (#6), London (#7), and Sao Paolo (#9).

Does that mean that the United States is losing its innovative edge and falling behind in the race for B2B tech supremacy?

Not exactly.

Over the last few years, several factors have contributed to the rapid emergence of international startup ecosystems:

  • The explosive growth of the Internet and its access through mobility
  • A dramatic reduction in the cost of setting up a tech startup
  • The advancement and increased simplicity of software engineering
  • Significant global spread of technology education around the world
  • And, lastly, the emergence of new software distribution methods — namely, software-as-a-service and the cloud

Collectively, those factors have democratized the startup process and made it far easier for someone to build a software business anywhere around the world.

Why the United States is Still the Ultimate Destination

So, if the global startup scene has evolved so much in such a short period of time, why are so many non-U.S. startups continuing to migrate their businesses here? Couldn’t they save some cash (and frustration) by expanding to other markets closer to their home country?

It’s simple, really: Despite the ubiquity of international startups, the United States remains the access point for growth for the vast majority of international B2B tech companies.

In fact, as the Telefonica report illustrates, just three international locations — Tel Aviv, Toronto, and London — rank in the top 10 globally for access to funding.  By contrast, three U.S. hubs — Silicon Valley, Boston, and New York — rank among the top four locations for startup funding.

Additionally (and maybe more importantly), the U.S. has the largest concentration of B2B software buyers, as well. — and it’s where the most capital efficient sales models can be set up. That’s critical in the B2B space, where transactions and sales are generally much larger in price than B2C applications.

It’s important to remember that non-U.S. enterprise buyers are also generally hesitant (or totally averse) to making a big purchase online or over the phone. In the U.S., on the other hand, buyers are already convinced they should only buy SaaS products, and they are very used to buying them online or over the phone. That is why it is much easier and capital efficient to sell B2B software in the US.

And, lastly, there’s the issue of exit strategy. Despite global startup growth, the U.S. is still home to the majority of acquiring companies. If an emerging startup wants to have the option of an exit through acquisition, it’s best to establish a presence in the same market as a potential acquirer.

Combined, those factors often leave growing B2B tech startups no choice: Establish operations in the United States, or get left in the dust of a rival that will.

Barriers to Entry

In recent years, several international B2B tech companies have successfully migrated across the pond.

Customer support software company Zendesk, for example, was founded in Copenhagen, Denmark, in 2007, and is now prepping for a stateside IPO. Swedish business intelligence software company QlikTech, meanwhile, relocated to the United States in 2006 (and, oh by the way, now has a market cap exceeding $2 billion).

Of course, for every Zendesk and QlikTech, there are many, many other international startups whose migrations to the U.S. haven’t gone so well.

In the coming weeks, I’ll talk about why those migratory failures happen, share some common misconceptions that international startup founders have of U.S. relocation, and dive deeper into why, despite the obvious risk, U.S. migration is often critical to international companies’ long-term growth potential.

The one thing to remember, however, is that international migration never happens overnight.

It requires companies to undergo a long, multi-phase journey that presents myriad challenges and opportunities. All too often, international founders fail to fully prepare for that experience, or they don’t invest the necessary time into focusing on what exactly they plan to do once they hit U.S. soil. And, unfortunately, that typically leads to international startups sinking their ships before they ever really had a chance to anchor somewhere fruitful.

What, Who and Why


What I Do

I help non-US based tech startups get established in the US. I do this by providing hands-on support with building company operations in Boston, including transitioning the headquarters and founders as well.  My approach is to work with one or two companies a year where I can take a part-time operating role as a member of the senior management team.  My role is most intense and impactful in the first 12-18 months of my engagement.  After that, I take on a more typical advisory role as an independent board member or operational advisor.

One way to describe my approach is that of establishing a beachhead for my client companies. I am the first person in the US representing my client operations. I help the founding CEO build a plan for launching US operations, and I begin laying the foundations for the eventual build-out of the company team here.

Why I Founded (N)Squared

In my eight years as an investor at OpenView, I ran into many super exciting companies based outside the US. Most of these companies were looking to enter the US, but had little experience doing so. Everyone knows that starting a tech company is quite daunting. What is more daunting is starting a company outside the US, and then having to go through another startup experience bringing it to the US.  Entering the US is a difficult thing to do. Many a companies failed in their first attempt to conquer this market.

It occurred to me that what these international companies needed was the operational support to get the US team started, more so than an investment from a US investor. And so I decided to spin out of OpenView to start my own advisory firm. And (N)squared was born.

My goal is to de-couple the investment need from the operational support, and offer the latter on its own.  Yet my offering does in fact include helping my clients prepare for, and secure, US based funding.

Why Me

I have a unique blend of VC and startup experiences coupled with operational consulting experience.  I acquired the VC experience after eight years as a founding member and investing partner at OpenView.  I acquired the startup experience after five years as a founding member of three software companies, two of which failed and one survived into the expansion phase followed by acquisition.  I acquired the operational consulting experience after five years as a senior consultant in the Operations Management Group at Booz&Company.

But Why Me… Really

Because I am passionate about working with founders to help them build their startups. I thrive on mentoring. I have been there myself and made more mistakes than all of the founders I’ve worked with combined. The range of my experiences gives me a really broad viewpoint on all the elements that go into building a startup into a large company. I have sat on many boards, both as an operator and as an investor. I went through many rounds of funding both as entrepreneur and as investor. I have lived through two startup failures as an entrepreneur and one as an investor. I have seen two of my portfolio companies grow into companies about to file their IPOs. I have helped three companies based outside the US establish their US businesses. I have lived in five countries and have strong appreciation of cultural nuances. I have lived in six states in the US and understand the nuances of the America culture. At heart, I am an operator, an entrepreneur and an internationalist.

And most importantly, this is what I really want to do.

Target Clients

If your startup is a Business-to-Business software company
If your startup is based outside the US
If your startup has a large market in the US
If your startup is generating run-rate annualized revenue of $1 million to $10 million
If you are ready to make the leap into the US
If you are willing to build your US headquarters in Boston

Services I Offer

US Expansion Strategy: work with my companies to define the overall expansion stage, and the specific approach to entering the US. This phase includes the definition of the mechanics of shifting some or all company operations to focus on the US. It defines the target US market segment, and the associated distribution model. It defines the composition of the US team, the sequence of hiring, the budget model, and the required funding.

US Sales Incubation: work hand-in-hand with the founders, to setup the first sales process in the US. This includes the development of a sales process, incorporating the process into the CRM, launching marketing and sales activities and optimizing those activities over time. It also includes hiring of the sales resources, or outsourcing to an agency. It includes the establishment of an office with all its associated infrastructure.

Funding: work hand in hand with the CEO to define the expansion model and budget going forward and identify the funding need.  Complete overhaul – or first time build – of an investment package that provides the optimal positioning of the company, definition of target market and growth potential, competitive differentiation and market segmentation, and the approach to scaling the company.  Developing the due diligence data-room.  Launching the outbound program for engaging the right set of investors.  Coaching the founders on presentation skills. Providing support during term sheet negotiations and subsequent support of the closing process.

CEO Mentorship: work hand in hand with the founding CEO to develop and execute the company strategy. Defining the senior team needed and helping in the recruitment of top notch talent. Establishing and recruiting an effective Board of Directors.  Helping the CEO manage the board dynamics. And overall, helping the CEO avoid mistakes.

Who Does My Investor Board Member Represent?


Board-of-director-level issues rarely surface when the going is good.

Board meetings are pleasant when the company is executing well, revenue is growing, the value of the business is rising, and shareholders are starting to count their money. In these times, board meetings tend to be relaxed, and mostly focused on the business and its bright future.

But when the going gets tough, board dynamics can change to the worst. And with it, the role and priority of each board member can be accentuated and/or confused.

Investor Board Members

One of the confusing roles is that of the investor board member. When the going gets tough, the company is feeling a cash crunch and conflict arises around the continued funding of the company and its associated valuation — the investor board member may invariably have to wear his or her investor hat when working with the CEO and the board. And that can sometimes create the blurring of the lines in the fiduciary duties of that board member.

Let’s me be clear at this point — the fiduciary duty of the investor board member is always to represent all shareholders and the best interests of the company. Always. Regardless of whether that duty may conflict with his or her VC firm’s interests.

Now that does not mean that the investor board member would not assume the investor role outside the board meetings. But when it comes to board discussions and decisions, the investor board member should always be wearing the company board hat. In fact, he or she is obligated to.

So lets step back and go through the basics of the fiduciary duties of board members.

Board Member Roles and Responsibilities

First and foremost, the primary responsibility of a company’s board of directors is directing, approving, and overseeing the strategic and financial operations of the business. In some cases where the chairman of the board is not the CEO, the board is also responsible for managing the operations of the company and its senior team. In all cases, the CEO reports and is accountable to the board.

Each board member has a fiduciary duty to represent the best interests of the company and all its shareholders. Failure to do so can result in a personal liability to the board member.

There are two forms of fiduciary duties:

  1. Duty of Care: This is where the board member makes best efforts to have a solid understanding of the business, be well informed and aware of the strategic and operational goals, and make the time and effort to engage in the evaluation of all the options available to the company before making decisions as a board. In that, board members should solicit the expertise and options of third parties (lawyers, consultants, bankers). Board members should also hold each other accountable to being engaged and making themselves available and informed.
  2. Duty of Loyalty: Each board member must represent the interests of all shareholders over and above his or her own personal or professional interests. The duty of loyalty is one that can be confusing for CEOs/founders, and is the one where investor board members can feel the divergence of interests between their duty of loyalty and the priorities of their investment firm. But when it comes to board matters, investor board members must make sure that they are not allowing their investment priorities to come into play as the board deliberates over company strategies, funding, or acquisition decisions.

These are the basics.

Here are examples of questions that come up in these situations:

  • When is the right time to set up a board of directors for an early stage company? I have written a lot about this, and a fantastic resource to check out is OpenView’s Building a High-Impact Board of Directors eBook. The quick answer is you should not wait long.
  • I’m the founding CEO and I have a board. But I own a large percentage of the company and it’s still my company. When the going gets tough, do I have to abide by what my board tells me? Absolutely. Once you set up a real and legitimate board of directors, you don’t own the company any more. You, as CEO, are accountable to the board. You also have the same fiduciary duty to represent the interests of all shareholders, including those of your investor(s). If you are not ready to give up control, then don’t form a board and don’t raise money from an institutional investor.
  • How do I avoid having a duty of loyalty conflict with my investor board member? First, make sure that you are setting the right expectations for the company to the investor when you decide to raise money. Conflict with your investor typically arises when the company does not perform to expectations. Second, make sure you never run the risk of running out of money. Third, make sure you are not reliant on one investment firm. Diversify your investor base. One investor is too few. More than three is too many.
  • I don’t think my investor has the company’s best interest at heart. What do I do? First, make sure that you have a complete and cohesive board. Make sure that you have independent board members who are qualified. Independent board members can provide more balance to a board, which can alleviate the gravitational force of the investor board member. Second, make sure to give the investor board member that feedback. Be clear why specifically you feel this way, and be specific in your expectations. Before you confront the investor, make sure that the rest of the board shares your concerns. It may be that you are the one guilty of not representing all the interests of all the shareholders.

The Pre-Pre-IPO Checklist


I recently read this article in Fortune about the 10 requirements for a successful IPO. Go ahead and read it if you’re interested in this topic. I’ll wait.

Most of my readers are CEOs of companies that are a few years away from even thinking about IPOs. So, I thought I’d give a count-by-count set of requirements that should get you to the point where you can start acting on the Fortune pre-IPO checklist.

Here we go:

The Pre-Pre IPO Checklist: 10 Requirements for Putting Yourself into Position

1) Hire an Operational CFO

At the early stages of a company, the CFO is the founding CEO’s co-pilot. What you don’t need in a CFO at this stage is IPO experience. Instead, what you need is a CFO who is highly operational and has the prerequesite CPA-centric financial experience.

An operational CFO can help the CEO in many ways. Here are four examples:

  1. Building and assisting the CEO in managing a financial and economic control book
  2. Helping the CEO manage the operating rhythm of the company.
  3. Providing oversight to the sales team’s forecasting accuracy and reporting to the board the CFO’s more prudent forecast.
  4. Helping the CEO manage the board and board meetings.

Once you get to the pre-IPO stage, you may need to augment the operating CFO with an independent board member who has IPO experience, or replace the operating CFO with an IPO CFO.

2) Reach Out Proactively to Strategic Partners

Getting to pre-IPO status requires getting to scale. Getting to scale requires leveraging multiple channel of distribution. Leveraging multiple channels of distributions requires building strategic distribution partnerships with larger companies. And that requires building a comprehensive market map of your competition and your potential partners. Finally, with that visibility, you should be regularly reaching out to potential targets that can turn into partners.

The added bonus here is that you will also be building relationships with potential acquirers. Why would you bother if your plan is to go after an IPO?  Because the probability of getting to an IPO is pretty slim. Cover your bases.

3) Leverage a Network of Investment Bankers

Bankers are another channel to utilize to increase the awareness of your company, and a good source for insights on competition and strategic partners. Build a list of 3 – 4 investment bankers who know your market very well. Develop a quarterly update schedule to keep them up-to-date on your company and your partnership strategy. Suck them dry for insights on your competition and the strategics.

4) Build Your Senior Management Team

Each stage of a company’s evolution requires a revamp of the senior management team. At the startup phase, you need a set of young entrepreneurial masters-of-all-trades. At the expansion stage, you need a set of functionally experienced executives (e.g. VP of Sales, CFO, etc.) At the growth stage, you need a set of managers who have experience managing large teams, and some experience in the transition from a private to a public company.

5) Update Key Market Influencers

Influencers include analysts, reporters, and bloggers who cover your market. They are another channel of increasing the awareness of your company, and a good source for insights on your target segment and your competition. Build a list of 8-10 influencers and develop a quarterly update schedule to keep them up-to-date on your company, as well.

6) Make Sure Your Company is Properly Funded at All Times

  • Rule #1: Never run out of money.
  • Rule #2: Always make sure you have the right operational economics and the right level of funding to support your company aspirations.
  • Rule #3: Don’t raise too much money.

7) Build Your Operational Control Book and Manage By It

Startup companies tend to base a lot of management decisions on “gut feel” and a practical sense of the business. At the expansion stage, CEOs need to turn their attention to the economic model with which to grow their companies, and the set of key metrics to run the company by.

The control book is the closest thing a business has to the instrument panel of an airplane. Lots of necessary dials (metrics), with a handful that are top of mind for the pilot (CEO) and co-pilot (CFO).

8) Start to Build the Predictability of Your Business

In addition to managing by and through a set of key metrics, this is also the time to start managing with predictability. At the startup phase, predictability is an illusion. But at the expansion stage, you should be able to develop more predictability in your operations.

Your development team should adopt a management methodology (e.g. agile) that holds the team accountable to performance and deliverables. The sales team should develop a forecasting process that is reliable. The professional services team should be managing to a target profitability and billability. And so on. This level of predictability is a precursor to the much more stringent pre-IPO requirements to come.

9) Ensure that You Have a Board of Directors that Shares Your Aspirations

If you aspire to an IPO, make sure that you have investors who are aligned with you goals, are in it for the long haul, and can fund you as needed. Make sure that you have board members who can guide you on your journey from the early stages to the IPO stage. Recruit board members who can challenge you, and who are what your next stage of evolution requires. At some point, you will need to swap out some board members for ones who have IPO experience.

10) Build a Great Company

Yes, that’s an obvious one. But you would be surprised how many CEOs talk the talk but don’t walk the walk.

Building a great company requires many facets of greatness. You need lofty aspirations that are inspirational yet achievable. You need a great product that addresses a strong need or desire. You need a world class operation that scales efficiently. You need outstanding employees who are passionate about the company. You need to develop your employees and treat them like your most precious asset. And you need a great culture that is the envy of your competitors.

May the force be with you.