
Ask HN: What are the signs that company you work for will be successful? - DidISayTooMuch
I work for a well-funded Series C SaaS startup in the Bay. The pay is in the 50th percentile for my skills and experience. My hope is that the company will hit IPO in the 2-3 billion range in the future (3-4 yrs). The company just had a positive cash flow of around 6M, with revenue over 60M.<p>BUT, I fear that there will be churn in the coming years. It has already started. Not sure if our customers find the service valuable. The company has pains around delivering value to our customers.<p>My question is: What should I look for in the company that can tell me whether to stay for &gt; 3 years (so I&#x27;m fully vested) or cut losses and move on to another company with higher pay?<p>* I understand the HN wisdom is never to rely on future growth of a company and instead, just take higher paying jobs. But there has to be data-points and factors that will indicate whether a company will be successful or not, right?
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11thEarlOfMar
Several things I'd consider...

\- Is the $60M greater or lesser than last year? How strong is that growth?
How does your growth compare to competitors, if there are any?

\- How much did that revenue cost the company? For example, if marketing
expenses were $100M to win $60M revenue, that's probably a problem. If
marketing was $20M, the company may be healthy.

\- With $60M in revenue, customers see some value, but what is the buying
behavior of customers? Do they in general sign up and use for a while, then
stop using? Do they 'buy up' to additional services (if that's your business
model). Are there a significant number that continue to use and pay?

\- The concern about delivering value may just be healthy customer-focused
anxiety, or, it may be due to undesirable customer buying behavior. I'd get to
the bottom of that. If the buying behavior is not negative, then your
management may actually be pretty solid. If the buying behavior is poor,
you're going to need to make a judgement call on whether you believe
management can work through it.

\- Also consider that at Series C, several VCs are already betting that your
company will succeed. What is the track record of the investors?

~~~
DidISayTooMuch
Thanks for making good points. The VCs are pretty solid, they are some of the
most respected VCs in Sand Hill Rd. Do you think they would push for an exit
(IPO/Sale) and that would make it worth staying?

The revenue is 60M with cash flow positive (6M) this year, so I think all
other expenses were less than 54M (including marketing).

Can you elaborate a bit about "healthy customer-focused anxiety"? I think a
lot of customers go into our service thinking it might prove useful without
seeing any value first. We have a good marketing and sales team, but I think
(and it's _my_ thought) that now they are finding that they are not getting
that much value from this service.

Now, I believe the management is solid and they are working to really re-focus
on creating more customer value which really makes me happy. Yet, I still
think there are several small sized competitors that could provide what we do
at a lesser price.

I am hoping that this year's quarterly results will help me calm down.
Because, I think if the company is not increasing it's return or on it's path
to a successful IPO, then it's better I seek a higher paying job.

~~~
11thEarlOfMar
'Healthy customer-focused anxiety' meaning they are focused on providing value
to the customers with a sense of urgency and importance. I.e., the fate of the
world relies on them providing true customer value. Thinking chicken and egg,
the founders may have been successful thus far because of such a mindset,
rather than developing that mindset because of poor performance. That is a
purely speculative statement, but if I were in your position, I'd want to get
a sense of which came first.

If I summarize the snapshot you've provided:

\- Series C: VCs have bet on your management 3 times.

\- Respected Investors

\- Solid Management, in your opinion

\- Significant revenue with + Cash flow

You most likely won't be dealt too many hands that strong. I'd stay with them
at least another 12 months.

One last point. If you have options, I believe you're privy to their value at
least annually. The Board of Directors should determine the company's value at
least that often. (it's very subjective, but informative, a VC's job is all
about company value). You might want to ask your HR representative for that
information, going back as many years as they're willing. That info would
provide insight into what they are thinking about the company's growth so far.

Good luck.

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gigatexal
If you could predict what you're asking you'd be the world's most successful
VC funder. I think a better thing to do would be to have a few offers all the
time. Be interviewing or building your network so that if you do lose your job
you can find another one quickly. That and investing in yourself to be as good
as you can be.

~~~
gigatexal
I was wrong. There are some common sense things you can do if you know the
financials to see how well you're company is doing.

