I am often asked by people how to get a job in venture capital. Rather than meet with people individually, I wanted to write a post.

The short summary is that it’s hard. The #1 best way is to start a company, take it public or sell it for billions of dollars. Every VC will hire you, but then you likely won’t want or need to work for any of them. Outside of that, there are a number of things you can do to better position yourself.

The basic question you need to be able to answer is, if someone gave you $60 million, how would turn that into $500 million? Or can you convince a partner at a firm that you have the expertise to help them achieve this goal through sourcing and deep domain knowledge in a specific area. For sourcing, that usually requires that you have a network within a specific ecosystem of founds, e.g. PayPal Mafia, early Google, Stripe etc. For domain specific knowledge, this will allow you develop a thesis in and assess companies in emerging areas such as AI or developer tools. For me, it was cleantech, what we now call climate tech.

My path to Venture Capital was definitely not straightforward. I started my career first as a production and then a research engineer developing new materials and design concepts for advanced aerospace applications. Then, I got the sustainability bug and pursued an MBA/MS in Natural Resources and Environment Degree from the University of Michigan. While there, I worked at GE in their Renewables division, did energy investing in Africa, worked on renewable energy policy for the UN, and even worked at a local VC.

Eventually, I landed a job at Battery Ventures investing in cleantech companies. I had a unique skill set and perspective at that time, a solid network in the space, and understanding of the technologies and investing experience. I did feel I was at a disadvantage to people from Harvard and Stanford who had a much deeper network in VC and the startup world. In any event, the cleantech market eventually imploded. We can argue if it’s really back, but that’s another post. Nevertheless, it was a terrible space for investments, but a great entry point for me into investing. One door closes, another opens.

I decided I didn’t want to invest anymore, and I wanted to become an operator and loved technology and startups. So, I decided to get my “MBA” in enterprise software at Salesforce. Most of my investments were in software and the early days of AI, but I didn’t really understand enterprise business models that well. So, I took a lateral move to learn a new space all over again.

I started out in M&A and acquired companies that led to the foundation of Salesforce’s Einstein/AI platform. I then formalized the investment arm, which then became Salesforce Ventures. I grew that team to around 35 globally and when I left, we were investing $1 billion annually. When I first started, it was just me and one other person, and we invested around $30 million in the first year. We worked 80 hour plus weeks, built the first website, ordered swag, etc. all while trying to make investments. At the time, many companies were also leery of taking on corporate VC dollars. It was not at all obvious Salesforce Ventures would grow to the scale it did. I thought it might be a career limiting move at the time. Corporate VC was in a different point in time then. There was a bit of good timing given the SaaS markets and Salesforce ripped from 2013–2021, but then again isn’t everything.

So, what’s the key takeaway from my story? Well, there’s no one definitive path to getting into Venture Capital. It’s hard to engineer a path to VC, but you can put yourself in a good position by pursuing something you’re really interested in, gaining relevant operational experience in an up and coming company, having a POV and a thesis, and building a strong network in the space. Angel investing is another great way to develop your investing chops, develops a bit of a track record and build a network.

As I mentioned, seats at established firms are very limited. I suspect there will be fewer seats over the next few years, not more. Timing and fit have to work out as well. Getting a job in VC is not guaranteed, so find an area and a role that you are passionate about, and do these other things to improve your chances. If it doesn’t work out that’s fine too, becauase you’ll be doing something where ther is a genuien interest.

“A rising tide floats all boats….only when the tide goes out do you discover who’s been swimming naked.” — Warren Buffet

We’ve watched the spectacular implosion of FTX over the last few months, and I suspect we’ll see more of this over the next couple of years as markets have cooled and venture dollars are no longer limitless. A question that comes up frequently, is how to spot this type of behavior in advance.

Howard Lindzon and Ted Seides discussed this on Howard’s Panic with Friends, one of my favorite podcasts. Howard and Ted’s opinion is that we won’t catch the next fraudster before they attract many investors. Their key insight is fraudsters spend 100% of their time trying to stay ahead, whereas, during diligence, the investor spends 99% of their time on analysis and one percent thinking about the prospect of fraud.

I think it’s more nuanced than that. Their conclusion may hold true for passive investing, which is what VC investing had become over the last few years. But as a VC you can usually spot many signals and tells during diligence.

VCs often seek out founders with outsized personalities who see a different reality and bend the world to conform to their vision. They are innovators and often successful entrepreneurs. But many notorious fraudsters fit this bill as well; they are charismatic, smart raconteurs with a compelling vision, willing to push the limits. This is how Adam Neumann raised $350M in a series A despite the failings and questionable practices of WeWork. There was not fraud but there was a lot of self-dealing with little oversight and a challenging business model. But because of his charisma and vision, he was able to grow WeWork to an amazing scale very quickly. After WeWork collapsed, he was able to raise a large amount of money for his next venture. I presume A16Z are willing to take a large gamble on him, given how quickly grew WeWork before his ousting. It take a unique person to build something of that scale.

A bold vision is why investors are often drawn to these characters in the first place, as these are the opportunities with the highest upside. It is unfair to call most of these people fraudsters. In my experience, they are drinking their own Kool-Aid, not outright intentionally deceiving investors. Probably Sam Bankman-Fried didn’t intend to loan out customer money in the beginning, and once he started to do so, thought he could pay it back. He did commit fraud. But there is a plausible scenario in which interest rates stayed low, SBF kept minting money and, over time, got professional help around him to make FTX successful. Based on reports, it seems unlikely, but if the company started three years ago, a viable outcome can’t be completely discounted. SBF appears to have operated on the fraudster extreme, but the path he blazed is not too dissimilar from many others I have seen.

I can’t speak to the particulars of SBF and FTX, even though they seem egregious. I have been around plenty of high-profile people, we’ll call them shysters, who exhibit hallmarks similar to those seen with SBF and FTX. I have attended dinners with high profile shysters and very high-profile public CEOs lauding their vision, even though they clearly seemed to be pumping something. Everyone is susceptible to a good story, even very smart people who should know better.

I do believe these founders are trying to build a big business. Maybe, they are doing this for the wrong reasons. For the shyster persona, what quickly emerges is a lack of deep operational capability, insecurities where the truth is stretched and the storyteller doesn’t have a great grasp of the details or doesn’t share, all the details. Their story is forging well ahead of their progress or capabilities. I’m from Kentucky, and we refer to this as “all hat and no cattle.” But it is these creative and imaginative story tellers that Silicon Valley investors seek out. But no one changes the world without a great story. So, we reward this talent until we don’t.

Many of the great founders I’ve met have a gift for dreaming big, spinning tales, and distorting reality to really make inspiring things happen. I’ve read enough Steve Jobs bios to know he was like this. I worked around Marc Benioff; he was also like this. I am not insinuating these CEOs are fraudsters. Quite the opposite. Benioff could go through an operational review with his executive team and focus in on the underlying problems quickly. He understands Salesforce inside and out, and is an immensely and uniquely talented CEO.

I was never close to Travis at Uber, but I understand he had similar personality traits. Uber also hired an amazing operating and technical team; both are world class. Uber was known for pushing limits; they were violating local regulations openly. That’s a different issue than bilking customers, employees, and investors of their money.

Based on the outcomes of companies like Salesforce, Apple, Uber, etc., investors seek out unique, quirky, and contrarian people because they create the biggest outcomes. These founders, through their vision and storytelling, are very good at hiring and raising money. This is true for the fraudsters I’ve met, as well; although they don’t retain people very well. The veneer comes off quickly. But without closer inspection, it may seem the only difference between a visionary CEO and the shyster is the outcome. That is false.

I have been well acquainted with some prominent private companies that collapsed under their own weight, and there are signals to watch for that can predict this as a likely outcome. We won’t recognize the fraudsters every time, and we might get fooled again. But we can protect ourselves by being alert to these common tells:

• Does the CEO have a clear grasp of the details of their business? If they talk around the details with hand- waving stories or are dismissive of the details. claiming their focus is on the big picture, there’s a problem. I have heard companies at $20M in Annual Recurring Revenue (ARR) say things like, “Generally Accepted Accounting Principles (GAAP) Revenue — that’s not something we track.” Or look confused about its meaning.
• The CEO shares information, but when you ask for details beyond their pitch, they don’t/can’t provide them. They are dismissive or make excuses why they don’t have the supporting data. If it seems they are hiding the ball, they are. Run.
• If the CEO is technical and you drill into specifics on technical claims or business claims, and they throw out a bunch of jargon, that’s a flag. If you bring in a technical expert and it also seems like jargon to them, walk away.
• Fraudster CEOs create lofty sales targets (that they often miss). You can discern it in their CFO’s face when going through projections. Most CFOs are straightforward. Meet with the CFO alone or ask for the slides from the previous board meetings. If targets are missed by a lot, its claimed that things will be up and to the right this quarter or the next, beware. Explanations are usually not detailed and previous board decks have the same message.
• Doing unnatural things to inflate valuation (like acquiring companies very early on) is a red flag.
• Self-dealing and/or taking a LOT of money off the table early. There has been a lot of this in the last two years, and it usually doesn’t end well. I understand when founders take money off the table to buy a house or enable employees at a company to get rewarded. But when the CEO takes enough off the table to never have to work again, it is problematic.
• If the business is in a regulated space, like the financial technology sector, does it have qualified people ensuring regulations are followed and do they have really good risk and underwriting teams? Not having highly qualified individuals in those roles is a bad sign.
• Does the CEO name drop a lot? This by itself is not a disqualifier, but it signals more careful investigation is in order.

In 2020 and 2021, it was easy to overlook many red flags given the pace of investment and the short diligence timelines. But the best CEOs provide the necessary information or they have a reasonable explanation why it’s not available. When I invested in Snowflake in their pre-IPO round, The CEO and CFO didn’t have to give us much information. Everyone wanted to invest in that company. The leverage was all theirs. They still spent several days going through data with me. It was clear that it was a matter of principle. The negotiations demonstrated the same. They were very tough, but if I had a principled reason why I couldn’t give on one or two issues, they conceded if it wasn’t a huge business point to them. Contrast that with the auction style fundraising that happened over the last 2 years.

I hope this is a useful framework to help spot and avoid bad behavior in companies earlier.

Looking back on a watershed year for enterprise technology companies that enable digital transformation, and considering what the future might hold.

Salesforce Ventures was founded on the belief that the surest way to spark growth and boost customer success is to accelerate the expansion of a cloud ecosystem and support startups that drive innovation. Since then, our thesis has been both well-tested and well-proven. Indeed, the pace of change is accelerating and transitions we thought would take decades are happening right now.

In 2020, we found ourselves in a period of unexpected change, including a sudden switch to remote work and accelerated adoption of cloud technology. Digital transformation became an urgent imperative. When it counted most, the utility and value of the cloud were universally confirmed, and enterprises that embraced digital transformation were made more resilient, efficient, and adaptable.

We also witnessed enterprise technology leaders step forward to stabilize and support their customers, employees, and partners — leaving them even stronger than before. We conducted two surveys of cloud CEOs this year and learned that churn turned out to be lower than expected; and in Q2, when executives had a clearer picture of how the pandemic was impacting their business, almost all of them forecasted they would reach 76% of their plan or more for the year; up from 30% forecasting as such when we asked them in March.

Reflecting on the past ten years makes it clear how far we’ve come and how much has changed. When we first started investing more than a decade ago, cloud-based software was still a relatively small piece of the overall tech industry. The next decade will be even more transformational. We are only in the beginning stages of the transition to the cloud, and there is a long way to go before the world is fully cloud-native.

We’re keeping our eye on several trends set to shape the coming decade, and we plan to invest accordingly:

Data as the linchpin of digital transformation 2.0

To achieve the promise of Digital Transformation 2.0 and Customer 360, you need a holistic view of your customer data. As companies around the world continue their data transformation and bring on more cloud applications that generate and consume data to analyze every aspect of their business, an opportunity has emerged for solutions to seamlessly manage all that information. A number of Salesforce Ventures-backed companies are driving this innovation, including Auth0, BigID, Crossbeam, and Snowflake.

Apps that bring more flow

We will see fewer monolithic products as applications continue to become more cross-product, cross-functional, and cross-cloud. This will lead to collapsing workflows and functionalities across different departments. A number of Salesforce Ventures-backed companies are driving this innovation, including Qualified, Workato, and Automation Anywhere.

Artificial intelligence and automation

As AI matures, we expect more cloud startups to build automation into more products to improve predictive capabilities and product usability at scale. Interfaces will continue to improve and data entry will become more automated — so employees won’t need to log in as often, yet the quality of data will improve. A number of Salesforce Ventures-backed companies are driving this innovation, including Airkit, Process Street, Gong, Qualified, and Outreach.

Remote work and collaboration

Technology never moves backward. Long after the pandemic is over, a number of newly-learned, tech-enabled behaviors are likely to become societal norms. One of those is an increased reliance on remote work. Supporting distributed teams will require continued investment in virtual communications and experiences, data sharing and security, and tools that enable remote sales and service — anything that supports laptops in the field. A number of Salesforce Ventures-backed companies are driving this innovation, including Auth0, Hopin, Tanium, Talkdesk, Outreach, and Qatalog.

Investing with Values

Salesforce Ventures is driven to lead with our values, incorporating social responsibility, sustainability, and diversity into our investment process. Our goal is to contribute to the creation of a more resilient and inclusive economy — one that ensures the long-term wellness of citizens, drives job creation, protects against future shocks coming from climate change, and breaks down systemic barriers across race and gender.

Out of a desire to address the extremely low representation of Black professionals in technical, leadership, and investing roles, we co-founded Black Venture Institute, which aims to 5X the number of Black check writers in three years. We also announced $100 million of intentional capital to empower cloud companies led by Black and underrepresented minority founders and launched a new $100M Impact Fund to continue to invest in companies solving the world’s most pressing challenges.

Looking forward

As 2020 comes to a close, we are appreciative of the resiliency, ingenuity, and generosity of our Ohana — and grateful for our partnership with you. At Salesforce Ventures, our goal is to help the entire cloud ecosystem flourish. If you’re building a cloud company in the areas in which we invest, we’d like to hear from you.

Here’s a quick look back at our year:

Hindsight in 2020: The Unexpected Urgency of Adopting Cloud Technology was originally published in Salesforce Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.

Salesforce Ventures is doubling down on its position in Snowflake with another $250 million investment while continuing to invest in data-centric companies that are fueling the next generation of digital transformation.

If Digital Transformation is the act of modernizing your enterprise by converting old paper-based processes to smarter and more efficient cloud applications, Digital Transformation 2.0 is the act of securely and privately connecting the data from all of these digital processes to create a 360° view of your customer across all touchpoints and interactions. Digital Transformation 2.0 harnesses the power of data and unlocks the potential of artificial intelligence, business intelligence, and automation to deliver strategic insights that weren’t possible before.

Salesforce Ventures has been investing in companies that advance the next wave of digital transformation for some time, and our February investment in Snowflake, a cloud-based solution that breaks down data silos and enables cross-organizational data storage, sharing, and analysis, is a great example of that. We congratulate Snowflake on its achievements, including this week’s IPO.

We’re excited to share that in addition to our previous investment in the company, Salesforce Ventures has invested an additional $250 million in Snowflake.

This year, with so many things being upended, disrupted, and redefined, we’re seeing digital transformation happen much faster than we ever imagined. The pace of change is accelerating. Transitions we thought would take decades are happening right now.

Digital Transformation has clearly become an urgent imperative, and the next step, Digital Transformation 2.0 — leveraging the full value of customer data — is critical to its success.

We believe Snowflake is a foundational component of Digital Transformation 2.0. Last year the company brought on Frank Slootman, former CEO of ServiceNow and Data Domain, to be its CEO. Snowflake’s revenue for the six months ended July 31, 2020, jumped 133% from the year prior, to $242 million.* The eight-year-old company counts more than 3,100 customers, including Adobe, Capital One, and Sony. Customer satisfaction is incredibly high: Snowflake reports net retention of 158%* and a net promoter score of 71, which we believe is significantly above the industry average. (For more on our investment thesis and Snowflake, you can check out the post we wrote about our initial investment in the company here.)

To achieve the promise of Digital Transformation 2.0 and Customer 360, you need a holistic view of your customer data. In addition to warehousing data with Snowflake, Salesforce provides seamless enterprise integration with MuleSoft and business insights through Tableau, as well as Salesforce Ventures’ investments in Automation Anywhere, Alation, BigID, Privitar, Workato and more.

Last year, Salesforce Ventures invested in Automation Anywhere, which uses machine learning and artificial intelligence to automate specific tasks, such as managing invoices or populating data into Salesforce from other sources.

We’ve also invested in companies that help enterprises manage data at scale, such as Alation which allows data science, data engineering and analyst teams to structure and query data across different information sources within an enterprise, and Workato, which gives business users the power easily build workflows across all the silos where data resides.

Privacy and security are paramount when you’re sharing data across different apps and teams. To help enterprises rethink their approach to their most valuable assets — their data — we invested in Privitar, which makes it possible for organizations to protect and analyze their most sensitive data, and BigID, which automates data compliance and transforms how enterprises find, track, secure and govern their customer and employee data.

When all these apps come together, you can extract even more value from your existing apps. A business intelligence tool like Tableau, for example, becomes supercharged: Instead of a dashboard that represents specific parts of your business, such as your sales pipeline or the number of customer service cases, you can now see how your entire business is performing.

We believe the promise of Digital Transformation is more attainable than ever. Enterprises of all sizes can access high-performance software that helps ensure customer success at scale; enable richer collaboration between and within teams; draw insights from an endless stream of data; leverage machine learning; satisfy regulatory requirements; build predictive, personalized sales and marketing programs; amplify the power of their workforce, and keep global production and supply chains moving — all while seizing emerging opportunities in a rapidly changing environment.

Footnotes: *according to its S1. **as of July 31, 2020

Data is the Linchpin of Digital Transformation 2.0 was originally published in Salesforce Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.

This morning, for the fifth year in a row, in partnership with Forbes and Bessemer Venture Partners, Salesforce Ventures is excited to reveal the 2020 Cloud 100, the definitive list of the world’s top 100 private cloud companies and the 20 rising stars poised to join their ranks. We’re proud to be part of the global cloud community and appreciate the opportunity to honor and recognize these companies and their achievements.

It’s an understatement to say that the cloud industry has seen tremendous growth. Today, 25 publicly-traded SaaS companies carry market capitalizations of more than $10 billion — up from three just five years ago. Since the last Cloud 100, eight companies have graduated from the list, Salesforce Ventures-backed companies nCino, which went public in July at a $2.8 billion valuation, Plaid (acquired by Visa for $5.3 billion), and Vlocity (acquired by Salesforce for $1.3 billion).

In record time, we’ve already seen two companies graduate from the list. This morning, JFrog ($FROG), #14 on this year’s Cloud 100 list, listed on Nasdaq. This year’s Cloud 100 #1 honoree, Snowflake ($SNOW) also listed its shares on the New York Stock Exchange this morning in a blockbuster IPO. When we first invested in Snowflake last February, we shared why we are so excited about how they are ushering in a new data-centric era of cloud technology. Asana and Sumo Logic also recently filed to go public.

Even as many cloud technology companies have been seeing success, society has been facing several global crises all at once — a health crisis, an economic crisis, a crisis of racial injustice and a climate crisis. The cloud industry is offering solutions to new problems, as well as old ones that have been exacerbated. In a recent survey of Salesforce Ventures portfolio companies and Cloud 100 CEOs, 86% said they believe the pandemic has accelerated digital transformation, and more than 50% of them said they are seeing tailwinds in their own businesses.

We see the bar raised each year to be part of the Cloud 100 list. Over the past five years, the average valuation of a Cloud 100 company has more than doubled, from $1 billion in 2016 to $2.7 billion in 2020. Of the 100 companies on the list this year, 87 are valued at more than $1 billion — more than double the number of unicorns on our inaugural list in 2016.

Cloud 100 companies are leading the way in digital transformation, helping enterprises re-imagine everything about their businesses.

As data becomes an ever-more critical component of digital transformation and automation, companies that help enterprises solve data-related problems will continue to grow. We recommend keeping on eye on Automation Anywhere (#20), which uses natural language processing, image recognition and other advanced technologies to automate tasks from billing to managing the flow of customer data; BigID (#93), which automates data compliance and transforms how enterprises find, track, secure and govern their customer and employee data; and Zapier (#24), which connects disparate apps, making it possible to automate workflows between them.

With so much data being shared across data warehouses, internal organizations and partners, security and compliance issues are front and center. We believe Tanium (#12), a unified endpoint management security platform; Snyk (#86), a developer solution that quickly finds and fixes security issues; and Auth0 (#19), a solution for developers that authenticates and authorizes their applications and APIs, stand to benefit from increased demand.

Companies that offer solutions for virtual collaboration and communication for employees, as well as sales, customer service and retention, were well-represented on the Cloud 100 list this year, including Salesforce Ventures-backed companies Gainsight (#88), Gong (#71), Highspot (#98), Outreach (#81) and Talkdesk (#53).

Retail, sales, and banking processes were already moving online, but shelter-in-place and a flight from cash to convenience quickened the evolution. Payment processing platform Stripe (#2); digital lending platform Blend (#64) and international payment network Airwallex (#61) are making it easier for enterprises to make the transition to cloud-based transactions and services.

We hope you’ll join us in congratulating all the companies who earned a spot on the Cloud 100 this year. The opportunity to help organizations modernize their businesses continues to grow as enterprises around the world have come to realize that digital transformation is no longer a competitive advantage; it’s an urgent imperative.

For more on The 2020 Cloud 100, including recaps of our virtual summit with some of the world’s top cloud CEOs, visit: bit.ly/2020cloud100.

The Rise of the Cloud: The 2020 Forbes Cloud 100 was originally published in Salesforce Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.

As we come to terms with the profound impact COVID-19 is having on our personal and professional lives, people and businesses everywhere are balancing their short-term need to stabilize with their long-term plans for growth.

We surveyed Salesforce Ventures portfolio companies to get a sense of how companies are adapting to the rapidly changing environment and to share some best practices. (You can see the full survey results here.) Recently, I was fortunate to share a virtual stage at SaaStr Bridging the Gap with Adnan Chaudhry, SVP Commercial Sales at Salesforce. We discussed some of the ways SaaS companies large and small are shifting their sales and go-to-market strategies to meet the times.

While we are all still working our way through a very difficult period, we are seeing encouraging signs of the resiliency of enterprise SaaS.

1) Companies are managing churn

Most of the companies we surveyed expect to see some increase in churn. While no amount of churn is good, respondents expect it to increase to a manageable level: Only 12%* of respondents said they think churn will increase by 11% or more this year.

One way to keep churn numbers in check is to provide existing customers with some financial flexibility. More than a third of our survey respondents said they have offered payment deferrals to customers to help them stay afloat and keep them committed for the long term.

Adnan suggested another approach to keeping existing customers happy: Get creative about pivoting your solution set. Consider sweetening the pot by providing access to extra functionality along with your base product for a limited time.

Finally, focus on deep listening, empathy, and flexibility. Your customers, like everyone else, are likely experiencing some level of financial pain and concerns about the future, as well as new execution and productivity challenges. You might discover new opportunities to reshape your product or service to meet their needs, and you’ll build a more meaningful, resilient, long-term connection.

Key Takeaway: The more profoundly you understand what your customers are going through, the more you can help them solve their problems.

2) New opportunities are breaking through

One of the best pieces of news we saw in our survey: Nearly three-quarters of respondents said they are seeing entirely new revenue opportunities that previously did not exist.

While most companies are still in the initial phase of the COVID-19 cycle, aiming to stabilize their companies and manage the effects of the crisis, they are focused on surrounding existing customers to see how they’re doing and finding ways to help them bridge through this time. Additional areas they are tackling are investing in their teams, recalibrating operations, and requalifying customers. We are encouraged to see a number of companies are also beginning to identify new opportunities.

In our survey, 84% of respondents said they are shifting their sales strategy and more than half said that they will focus on upselling and expansion. Sales teams are working very closely with account management and customer success teams to quickly identify opportunities that are already in hand.

As far as new accounts, sales teams are prioritizing near-term prospects. Companies are exploring how to meet prospects where they are, including adjustments such as reducing minimum order size and adding additional services.

Sales, customer success, and account management teams are becoming more nimble, more adept at identifying new opportunities and innovating on the traditional sales motion.

Key takeaway: Even amidst economic contraction, areas of growth are emerging.

3) Companies need technology that can help them quickly respond to the changing environment

In recent weeks we have seen the acceleration of tools that allow remote communication, online shopping, collaboration, and more. We are also starting to see second-order effects appear as every industry is being impacted. As supply chains get disrupted, companies are having to rapidly ramp up new suppliers and manufacturers.

Nine out of ten CEOs we surveyed said COVID-19 is accelerating digital transformation and will create a tailwind for their business. More immediately, we are seeing increased demand for technology that solves new problems, such as the need to rapidly pivot to new production methods and supply chains, as well as old problems that are suddenly more urgent, such as solutions that empower distributed workforces.

The pace of change is dizzying. Business processes that used to take months now need to happen in days or weeks. Entire industries are being upended, leading to previously unimagined outcomes, such as the need to spin up and serve new customer bases overnight.

Key takeaway: Digital transformation is helping enterprises become more nimble in an effort to respond quickly to the new environment.

None of us knows how long this will last. But we do know that eventually, this crisis will begin to abate, and when that happens, companies want to be poised for growth. To learn more about how enterprise SaaS CEOs are managing during this time, you can access our complete survey results here, and watch a recording of the Sales & GTM Strategies in Uncertain Times presentation here. Be well.

*Note: Data in our SaaStr presentation varies slightly from our full survey data due to additional survey responses.

Signs of Resilience: Three Takeaways for Enterprise SaaS was originally published in Salesforce Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.

Updated May 1, 2020

Salesforce Ventures surveyed its portfolio of enterprise technology startups to learn how CEOs are leading their teams through these uncertain times.

Startup leaders are used to leading through uncertainty, but COVID-19 brings even more challenges in the most uncertain environment most of us have ever experienced. On top of technical risk, market risk and competition, startup leaders now need to care for and manage employees at a distance, pitch and service customers over video conference, and craft new forecasts and plans in an ever-changing landscape. Questions abound, yet answers are few.

At Salesforce Ventures, we are committed to doing everything we can to support our startups in their missions. In an effort to share best practices around some of the tough decisions startups are facing, we surveyed our portfolio and asked about everything from bookings and hiring to sick leave policies and internal communications.

All 66 respondents are CEOs of Salesforce Ventures portfolio companies, ranging from seed stage to series D+. Our survey was administered and collated by our portfolio company, SurveyMonkey. Of course, all companies and their situations are unique. Our hope is that this report helps CEOS and leadership teams contextualize the way other startups are handling the crisis.

You can find the full report, including resources, charts, and details below.

We’ve summarized some of the key findings in four categories:

Taking Care of Your Employees

Companies of all sizes around the world are challenged to support their employees’ physical and financial well-being. Most are working hard to make sure employees have what they need to get through this stressful time including offering additional benefits to employees. 80% are providing additional resources to employees, ranging from reimbursing them for home office equipment to communicating new empathetic cultural norms, like normalizing children coming on-screen during a video call.

We also found companies are communicating frequently with their employees: 80% of respondents are holding company-wide meetings at least once a week to keep their teams updated.

Even though shelter-in-place mandates led to an abrupt adoption of working from home policies, 88% of respondents say they are more optimistic than they were before about the efficacy of remote work, and many are getting creative about helping employees feel connected.

Taking Care of Your Customers

When we asked what our companies are hearing from customers, respondents said their customers are citing uncertainty about the business and economic climate, budget freezes and cuts, and pending downsizing plans as some of their concerns.

Transparency and trust continue to be important themes. About a third of respondents say they have been communicating at least once a week with their customers about their COVID-19 strategies — more often than the frequency with which they’ve been reaching out about technology, product, and business updates.

Taking Care of Your Business

The vast majority of survey respondents — 84% — are shifting their sales strategies in expectation of budget cuts due to the COVID-19 crisis. Many of these changes are coming in the form of increasing efficiency in the sales process to adapt to the times.

Unsurprisingly, many respondents expect a significant slowdown this year. More than 40% of them expect 2020 bookings to decrease by 26% or more; another 15% expect bookings to be flat; just 11% say bookings will likely increase.

Survey participants also report making adjustments to accommodate customers that have been negatively impacted by the COVID-19 crisis. Slightly more than a third of our respondents report implementing payment deferrals for customers that need the extra time.

Taking Care of Your Community

In spite of increased pressure, many startup leaders and their teams are looking to reach out to people in their community and do what they can to support people who are more vulnerable right now. Nearly two-thirds of respondents are offering discounts or free services to non-profits, government institutions or others focused on COVID-19 efforts. Others are looking to give back by volunteering virtually. We’ve shared some resources in the hopes that they will be helpful during this time.

Onward

We recognize the situation is changing rapidly and in a few weeks, much of the underlying information in this report could change. At Salesforce Ventures, we are working with our portfolio companies, Salesforce leadership and our customers, to stay up-to-date on industry developments. As we learn more, we plan to continue to share with the community.

Despite what is sure to be a difficult period in the near term, we continue to be optimistic about the long-term future of enterprise technology and the SaaS ecosystem and believe in these industries' ability to accelerate efficiency and growth. Someday, things will be better. Until then, let’s help each other work it out.

Enterprise Tech CEOs Share How They Are Responding to COVID-19 was originally published in Salesforce Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.

Given the economic and business impacts of COVID-19, every company is trying to figure out how best to respond and adjust their business. To help startups benchmark and share best practices, we surveyed our portfolio companies to ask about the state of their business and the changes they’re making across their organizations to prepare for both short- and long-term market shifts.

We will share more details from the 66 CEO’s who responded and the full survey in the coming days, but meanwhile, we noticed a few important takeaways about sales and go-to-market that we wanted to share now.

Bookings

More than 40% of respondents expect bookings for the year to decrease by 26% or more, while 26% of respondents expect bookings to be flat or up this year. When we asked CEOs what kind of concerns they were hearing from their customers, many reported spending freezes, budget cuts, and a lack of visibility into the future.

Hiring

When asked about hiring, half of the respondents are planning to freeze new hires, while 30% are hiring fewer new people than initially planned, and 16% will need to reduce headcount.

Payment Relief

We asked if companies were implementing any payment deferral programs for customers that couldn’t pay due to COVID-19-related economic hardship. Roughly one third said yes; two-thirds said no.

Overall Shift in Sales and GTM Strategy

84% of respondents say they’ve shifted their sales strategies as a result of the COVID-19 crisis. Below are the most frequent changes mentioned:

• Pausing outbound prospecting to conserve resources for lower-risk sales, such as retaining and upselling existing customers, as well as closing near-term opportunities.
• Reducing previous time commitment requirements and pricing minimums to help buyers get to “yes” more easily.
• Building more efficiency into the collections process.
• Focusing sales efforts on industries that are less likely to be negatively impacted by the crisis. The assumptions are that hospitality and travel are unlikely to be spending at this time; respondents mentioned online learning, food and grocery delivery, and governments as potentially safer targets.

In the next few days, we will publish our full report on COVID-19’s impact on enterprise technology startups, including our methodology, more data, and resources that can be helpful during this time. Meanwhile, we hope this post is helpful. Stay well.

How Enterprise Tech Startups are Adapting Go-to-Market Plans in the Face of COVID-19 was originally published in Salesforce Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.

The cloud boom has led to an explosion in productivity, but many potential gains remain untapped due to challenges in managing all the resulting data. Salesforce Ventures announces its intention to support companies that make sense of it all, including a new investment in Snowflake.

By Matt Garratt and Spencer Chavez

Businesses all over the world are striving to become data-centric as a way to compete in the era of digital transformation. But in order to gain the biggest advantage, they need to master the challenge of organizing data easily, quickly and economically across all their data apps and data stores. This is the true promise of “digital transformation.”

However, as enterprises see the benefits of analyzing data about every aspect of their business, from sales and marketing to finance and operations, they find themselves with limited ability to access all of the insights these data hold. Why? Much of the data is trapped in silos, which can only be unlocked with heavy engineering and data science efforts. When leaders attempt to run high-value data analysis to solve more complex business problems, they realize they need more infrastructure and new solutions to manage the data, as well as more comprehensive data governance strategies.

It’s a massive opportunity for companies that can seamlessly manage the mashup of data. At Salesforce Ventures, we’re putting our weight behind multiple solutions in this emerging category, including our latest investment: Snowflake. We co-led the latest Series G investment alongside Dragoneer Investment Group.

San Mateo, Calif.-based Snowflake was founded eight years ago to create the first cloud-based analytics database. Backed by prestigious investors such as ICONIQ, Sequoia Capital and Sutter Hill, Snowflake employs more than 1,500 people. Among its more than 2,000 enterprise customers are Capital One, Electronic Arts, Overstock and Sony. Customers love Snowflake so much that it’s not uncommon to see a company ramp up its spend in just a few months, from tens of thousands to millions of dollars. It’s one of the fastest-growing SaaS companies we’ve ever seen. Last May, the company brought in Frank Slootman, former CEO of ServiceNow and Data Domain, to scale the company to the next level.

Snowflake today is a widely used solution for customers to store and analyze their operational data, including CRM data. Many of our customers also use Snowflake for their data warehouse to visualize their data in both Einstein Analytics and Tableau. With this investment, we will continue to strengthen our partnership.

Snowflake’s cloud data platform includes three layers: storage, compute and cloud services. What makes it unique is the way the company has architected this structure to allow customers to quickly scale new warehouses and share and access data between them. Snowflake is built on top of AWS, Azure and GCP, and gives customers the choice to run Snowflake on any of these platforms. And because Snowflake is cloud-native, it’s faster and easier to use, as well as more scalable and flexible.

Snowflake separates data and compute functions so you can store all your structured and semistructured data in one place, allowing you to create and manage all your data workloads on a single platform. For enterprises that are running lots of data-heavy applications, this is a big deal. Snowflake’s virtual warehouses are independent compute clusters that can simultaneously access the same data storage layer to run different queries without impacting the data or causing any performance issues.

Performance is phenomenal. Elastic compute makes it possible to instantly scale up and down and build multi clusters. You can start querying as soon as you load your data, and once you store it, your data is encrypted. It’s a game-changer for any business that relies on speed and security, such as those in finance or healthcare.

As companies around the world continue their data transformation and bring on more cloud applications that generate and consume more and more data, the need for solutions to control the data will continue to intensify. We’re committed to helping Salesforce customers manage this transition by supporting startups that are innovating in this space. If that’s you, we hope you’ll check us out at https://www.salesforce.com/ventures.

Investing in Clarity: Our Investment in Snowflake was originally published in Salesforce Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.

Introducing the Consultant Trailblazer Fund: Our Second $50 Million Fund for Consulting and Digital Agency Partners

Two years ago we announced the creation of a $50 million fund dedicated to consultants and digital agencies that partner with Salesforce. We launched the fund because they told us they were seeing a growing demand for Salesforce solutions — so much so that it was driving 50% annual growth for many firms. Several of them let us know they were looking for outside capital in order to hire more talent and rapidly scale, and we were eager to support their ambitious plans.

Since we started investing ten years ago, we have invested in 61 consultancies and agencies in 11 countries, including Astound Commerce, Silverline, Simplus, and Xertica — and demand continues to be strong.

Continuing our support for consulting and digital agency partners

Today we are proud to share the news that Salesforce Ventures is doubling down and launching the next Consultant Trailblazer Fund, our second $50 million fund dedicated to investing in consulting and digital agency partners. This fund will support our goal of reaching 250,000 certified consultants by 2022, leading to 3X the current ecosystem revenue.

This new investment vehicle is in addition to our core fund: Salesforce Ventures, which invests in next-generation enterprise SaaS startups across sales, service, platform, marketing, commerce and more. Through our investments in both software companies and consultancies, we have supported startups in 22 countries and raised multiple funds for regionally-focused investments, including most recently $125M in Europe, $100M in Japan, $50M in Australia, and $100M in Canada. We also invest out of our $50 million AI Innovation Fund and $50 million Impact Fund, which invests in companies using Salesforce to address challenges across workforce development, equality, sustainability, and the social sector. We view all of these funds as complementary vehicles to help us support startups that innovate and deliver customer love at scale.

Our commitment to the enterprise software ecosystem

Salesforce is on track to become the fastest-growing enterprise software company to reach $20 billion in revenue. At Salesforce Ventures, our goal is to help the entire SaaS ecosystem flourish along with us, and in order to get there, we aim to be the most supportive strategic SaaS investor.

We’re 100% dedicated to backing enterprise companies and we’re proud to play a role in the creation of such a robust sector. We started investing in 2009 as the SaaS ecosystem was just starting to take root with a belief in the resilience and growth potential of enterprise software. Over the past ten years, we’ve supported more than 375 startups on their mission to drive innovation and customer success. Among them are emerging and established industry leaders including DocuSign, GoCardless, Guild Education, nCino, Twilio, and Zoom.

If you would like more details on the new Salesforce Consultant Trailblazer fund, visit https://www.salesforce.com/company/ventures/

Introducing the Consultant Trailblazer Fund was originally published in Salesforce Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.