Tell HN: Amplitude (YC W12) just went public

Re: Tell HN: Amplitude (YC W12) just went public – AMA

#111

Post by sskates » Thu, Sep 30, 2021, 7:11 PM UTC

lifekaizen wrote: post #70

sskates wrote: post #32

Earlier quoted context omitted.

The other posts have some great screenshots of our product. Giraffe Graph! That brings me back. The fees are actually the same between a traditional IPO as well as a direct listing. We ended up paying $15M or so all in between everyone. The reason some banks push you to a traditional IPO is that their real clients- public market investors like hedge funds who to repeat business with them, get a good deal on your stoc…

I’m glad you went direct. As a small retail investor it allows me to have access, and buying from employees and giving them some liquidity feels good like what a market should do. They also use restricted supply to keep the price high. Everyone’s locked up, no supply, it’s no wonder the price often jumps. Curious what you would say about pricing startup raises? There’s a line of logic which says don’t price too high,…

Yes, you've hit on the other advantages of a direct listing! Retail investors get the same treatment as big funds instead of being shut out which I love. Everyone's also allowed to sell right away which so you know you have full market information AND it's much better for the employees.

RE startup raises these are all what I call champagne problems (is it possible to win too much?). My philosophy is to aim for a little above (eg 20-30%) "market price" for what similar companies are raising at. If you go too much beyond that (eg 2-3x) then it can start to set the wrong expectations and it can get difficult to beat in the future even if you're doing well. It's not great to have misalignment with your shareholders (eg the investors who are now partial owners of your business). There is another train of thought that says to get the highest valuation you can, investors are professionals and will deal with it. So maybe I'm not bold enough. Either way, funding markets, particularly for startups now, are incredibly rich. They're probably 3x the valuation when we did venture/growth stage funding so you'll be in great shape no matter what.

Re: Tell HN: Amplitude (YC W12) just went public – AMA

#112

Post by sskates » Thu, Sep 30, 2021, 7:16 PM UTC

callmeed wrote: post #68

sskates wrote: post #35

Earlier quoted context omitted.

It's great to have you as a customer. Make sure you give product feedback to our team! Most of the money in SaaS is in large clients in the enterprise. Almost all large SaaS businesses have been built that way (Salesforce, Adobe, ServiceNow, Workday). Once you figure that out monetizing smaller companies goes way down in priority and it's a better strategy to give your product away for free. For us in particular: 1)…

To be fair Adobe IPO'd in 1986, long before SaaS was a thing. I wouldn't say they quite fit the bill of "built by selling large enterprise software contracts".

Yes, but they later pivoted into SaaS and have gone on to dominate enterprise CMO budgets. It's one of the most impressive business model changes by a large company.

Re: Tell HN: Amplitude (YC W12) just went public – AMA

#113

Post by sskates » Thu, Sep 30, 2021, 7:18 PM UTC

rathboma wrote: post #69

Did you ever consider bootstrapping the business after growing so quickly to 1m ARR after your seed round?

No, I started a company to maximize my positive impact on the world. Maximizing my economics/ownership/control was secondary so there was no question we'd raise venture capital if it would help us scale (and it did to massive effect!)

Re: Tell HN: Amplitude (YC W12) just went public – AMA

#114

Post by farmerstan » Thu, Sep 30, 2021, 7:30 PM UTC

oakfr wrote: post #91

sskates wrote: post #37

Earlier quoted context omitted.

I'm going to try to answer the question without divulging how anyone individually did. I took a look at the initial 4 year option grants for the first 10 engineers (this doesn't count refreshers or other follow on grants). The average value at $50/share (yesterday's opening price) is just over $10M. The group varied in experience from just out of school to a few years working when they joined. I feel we were a good d…

While I am happy for your company and for your first 10 employees (congrats, really), I am not sure that looking at their return teaches us much. Joining a fresh startup as employee #10 (or less) is somewhat of a gamble (even at YC). The following data would put things in perspective: 1. How do the average first 10 employees of a YC startup do? 2. How did the following cohorts in your company do? I am not trying to b…

To put things in perspective, in 1999 I joined a company that ipo’ed in 1997. The company’s first admin assistant made enough from the ipo to buy a vineyard in Napa valley. I was employee 40 at a YC company and after exit I made 5 figures whereas the founders made high 8 figures. YC definitely teaches the founders to keep a higher percentage of equity for themselves and distribute less to employees.

Re: Tell HN: Amplitude (YC W12) just went public – AMA

#115

Post by farmerstan » Thu, Sep 30, 2021, 7:32 PM UTC

tehlike wrote: post #108

caseyf7 wrote: post #65

Earlier quoted context omitted.

While joining a FAANG in the past was most likely the richest path, that may not be true today.

An engineer 6-7years into their career can pull more than 1M$/yr in FAANG.

I have a close friend at Uber pulling in over $1M/yr. He joined just before IPO so he didn’t benefit from share appreciation.

Re: Tell HN: Amplitude (YC W12) just went public – AMA

#116

Post by carterschonwald » Thu, Sep 30, 2021, 7:56 PM UTC

Hey! i still remember when i was your TA a long time ago, mad props on IPOing :)

Re: Tell HN: Amplitude (YC W12) just went public – AMA

#117

Post by zomglings » Thu, Sep 30, 2021, 8:27 PM UTC

Congratulations @sskates!

My team has built a tool which can automatically add analytics/reporting to a code base (through code generation).

I have heard that Amplitude tried this as well, but didn't succeed. I find that hard to believe. Is it true? If so, did it not succeed for business reasons or technical reasons?

Re: Tell HN: Amplitude (YC W12) just went public – AMA

#118

Post by sskates » Thu, Sep 30, 2021, 9:25 PM UTC

boringg wrote: post #94

Now that you have gone to the public markets for more capital (congrats on what look to be a good liquidity event), where do you see the company going from here, how do you get there without private equity incentives for employees (ie continuing to get good talent) and what are the greatest challenges going forward? Best of luck on the next stage of the journey in the public markets!

We're going big after the Chief Product Officer in the enterprise. We're in 26 of the Fortune 100 today and are going to figure out how to get to a majority.

The levers you have available as a public company are different and I'm still learning them. Employee stock purchase plans are one thing we've already implemented that helps align incentives with company success. You can also be more aggressive about rewarding top performers with cash which is great. Sidebar: I've never met a great account executive who couldn't use more cash. If you want to make a lot of money in the next few years, come work with us as we take the market!

I feel good about the massive market as well as our differentiation. The #1 challenge is getting the right team in place to execute successfully against the opportunity. When you're growing 50-60% YoY, you have an entirely new company every 2 years. There is such a high degree of variation between people that just because you're a high functioning organization today does not guarantee you will be tomorrow. My biggest lever on it as CEO is the leaders we bring into the business and so I spend a lot of time thinking about how to get that right.

Re: Tell HN: Amplitude (YC W12) just went public – AMA

#119

Post by sskates » Thu, Sep 30, 2021, 10:00 PM UTC

zomglings wrote: post #117

Congratulations @sskates! My team has built a tool which can automatically add analytics/reporting to a code base (through code generation). I have heard that Amplitude tried this as well, but didn't succeed. I find that hard to believe. Is it true? If so, did it not succeed for business reasons or technical reasons?

It's possible to do and we've tried a few variations but it's so unwieldy that for 98% of cases we strongly recommend against it. Instrumentation isn't actually the hard part- it's managing your taxonomy. You're going to do that work at some point, and trying to sort through auto-generated events is much more difficult than manually instrumenting upfront. Maybe the technology has changed enough to make it possible though! I'll have my head of product reach out to compare notes as we'd love to talk more.

Re: Tell HN: Amplitude (YC W12) just went public – AMA

#120

Post by sskates » Thu, Sep 30, 2021, 10:10 PM UTC

hooda wrote: post #109

sskates wrote: post #106

Earlier quoted context omitted.

Deals ranged between $12-120k/year. We were very much the "deer" range vs rabbits or elephant hunting. The customers ranged from small to mid sized companies, we only had 2-3 true enterprises at the time.

Getting first 1-10 paying clients is really tough. And with the $12k-$120k/year range, it might have been really tough. Would you be able to share how did you get those first few paid clients? Thanks.

Our first one was intro from a prospective investor. Second sent me an email after we launched on TechCrunch. The third one sent us the following email:

"Hello — we are a Mixpanel customer and evaluating alternatives right now and came across the TC article. We also use RJ metrics, so what you guys are offering is really compelling.

I do have a question about what "custom integration" means on the feature breakdown by tier. Let me know if there is some more information about what that includes that I could review."

After that I can't remember. Ex-Zynga product people were an early sweet spot for us and we're lucky we got on a few of their radars. It was then about finding our way into more similar situations.