Tomasz Tunguz on Tomasz Tunguz

  • Meetings Shouldn't Be Boring

    Meetings Shouldn't Be Boring

    A friend suggested that I read the Five Dysfunctions of a Team over the weekend. Though I’m passionate about business books, I rolled my eyes. I had seen this one on best seller lists for a long...

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  • Managers Must be Insane to Brainstorm in Groups

    Managers Must be Insane to Brainstorm in Groups

    “Evidence from science suggests that business people must be insane to use brainstorming groups.” That’s a shocking statement. Adrian Furnham, a professor of organizational and applied...

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  • How Quickly Does Headcount Scale in the Fastest Growing Software Businesses?

    How Quickly Does Headcount Scale in the Fastest Growing Software Businesses?

    How quickly do the fastest growing software companies build their teams? The answer is incredibly quickly. In fact, this data bolsters the notion that management team’s top priority is...

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  • The Parallel Between Cryptocurrency and Continentals

    The Parallel Between Cryptocurrency and Continentals

    There’s a parallel between cryptoassets today and the British colonial period predating the US. In the late-1600s, colonies began to print their own money. Today, we’re seeing many startups coin...

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  • An Antifragile Thanksgiving

    An Antifragile Thanksgiving

    I’m grateful for all the entrepreneurs who have spent time teaching me how to build their companies. Over these past few days, I have been reading the book Antifragile written by Nassim Taleb. ...

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  • False Competition - Why Defining Axes of Competition Matters

    False Competition - Why Defining Axes of Competition Matters

    In the eleventh episode of Masters of Scale, Reid Hoffman interviews Peter Thiel. The episode revolves around the idea that to truly succeed, a startup must not beat the competition, but break...

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  • Disagree and Commit - A Management Principle for Highly Functioning Teams

    Disagree and Commit - A Management Principle for Highly Functioning Teams

    Disagree and commit. I first read about this idea in the 2016 Amazon Shareholders letter. But the idea can be traced back to Andy Grove at Intel. Grove wrote about this topic in High Output...

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  • The False Confidence of the LTV/CAC Ratio for Early Stage SaaS Startups

    The False Confidence of the LTV/CAC Ratio for Early Stage SaaS Startups

    Founders often describe their unit economics in terms of their LTV/CAC ratio - the ratio of the Lifetime Value (LTV) of a customer to the Cost of Customer Acquisition (CAC). The LTV/CAC metric...

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  • The Latent Purchasing Power in the SaaS Acquisition Market

    The Latent Purchasing Power in the SaaS Acquisition Market

    The startup acquisition market is off by roughly 35% year-over-year. Why the decline? One consistent response from potential acquirers is that they are waiting for tax reform to happen. If it does...

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  • Just How Disruptive Are ICOs to the Classic VC Model?

    Just How Disruptive Are ICOs to the Classic VC Model?

    Initial Coin Offerings, a fundraising mechanism for companies using cryptocurrencies as a mechanism to buy their service, seem to be upending the world of venture capital. Filecoin raised $250M...

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  • The Implication of Secular Increases in SaaS CAC

    The Implication of Secular Increases in SaaS CAC

    One of the major trends facing SaaS companies today is the rising cost of customer acquisition. Data on this trend has been difficult to find. Fortunately, Patrick at ProfitWell sent me his...

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  • Important Changes in Revenue and Profitability Definitions for SaaS Companies

    Important Changes in Revenue and Profitability Definitions for SaaS Companies

    Starting in January, public software companies will report their financials using ASC 606. Normally, accounting changes are not that interesting, but ASC 606 will change several of the key...

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  • The Rising Stakes in SaaS

    The Rising Stakes in SaaS

    Last week, I participated in two discussions about the changes in the SaaS world. I believe they are fundamental. The most important force shaping the industry today is competition. The level of...

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  • How to Decide With Speed and Conviction

    How to Decide With Speed and Conviction

    A startup’s competitive advantage is execution speed. That quickness stems from a CEO’s ability to decide and this ability separates the great from the good. According to a recently published...

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  • Monte Carlo Simulations of Inside and Outside Sales Teams in a SaaS Startup

    Monte Carlo Simulations of Inside and Outside Sales Teams in a SaaS Startup

    Recently, a VP of sales told me about the way he views the dynamic between inside and outside sales. Inside sales is the drumbeat, a highly predictable sales organization whose consistency...

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  • Shopify S-1 Analysis - Smiling All the Way to $10B

    Shopify S-1 Analysis - Smiling All the Way to $10B

    Shopify is an exceptional business. There are not many software companies who can nearly quadruple their enterprise value in two years. But Shopify has grown from $2.7B in enterprise value to...

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  • Decision-Making Auditing

    Decision-Making Auditing

    How do you help someone when that person knows substantially more about the question than you do? This is one of the most fundamental and frequent questions in management. I came across it first...

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  • How Much Should A SaaS Startup Invest in Sales & Marketing?

    How Much Should A SaaS Startup Invest in Sales & Marketing?

    How much should a SaaS startup invest in sales and marketing at different stages of the business? This is a very nuanced question, but benchmarks do provide some guidance for what is reasonable....

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  • Ownership - A Defining Trait of a Leader

    Ownership - A Defining Trait of a Leader

    One of the hardest things for me is to admit is when I’m wrong. It’s hard first to admit it to myself. But harder yet is to admit the error to others. It could be my wife or my colleagues. Most...

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  • Should You Consider Emotional Intelligence When Hiring Your Startup's Team?

    Should You Consider Emotional Intelligence When Hiring Your Startup's Team?

    How important is hiring for emotional intelligence? EQ or EI was introduced in 1964 by Michael Beldoch and popularized by Daniel Goleman in 1995. I hear EQ uttered in nearly every job interview...

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