Column
Auto Added by WPeMatico
Dear Sophie: Can you demystify the H-1B process and E-3 premium processing?
Here’s another edition of “Dear Sophie,” the advice column that answers immigration-related questions about working at technology companies.
“Your questions are vital to the spread of knowledge that allows people all over the world to rise above borders and pursue their dreams,” says Sophie Alcorn, a Silicon Valley immigration attorney. “Whether you’re in people ops, a founder or seeking a job in Silicon Valley, I would love to answer your questions in my next column.”
Extra Crunch members receive access to weekly “Dear Sophie” columns; use promo code ALCORN to purchase a one- or two-year subscription for 50% off.
Dear Sophie:
Our startup is planning on registering an international student employee in this year’s H-1B lottery. This will be our first H-1B.
Can you help demystify the H-1B process and provide any tips? We also want to hire an Australian and transfer their E-3. How quickly can this be done?
— Plucky in Pleasanton
Dear Plucky:
Thanks for your timely questions! There’s some great news for Australian citizens currently in the U.S. and looking for job transfers, amendments and extensions. Premium processing is now available for the E-3 working visa category! This means that transfers, changes of status, and extensions of status for Australians in the U.S. seeking an E-3 can now obtain adjudications from USCIS in as little as 15 days, making it much easier to hire an Australian who is currently in the U.S. for a new role. Go for it!
On the topic of H-1Bs, the registration period for this year’s H-1B lottery will open at 9 a.m. PST on March 9 and will close at 9 a.m. on March 25. Startups need to make sure they’re registering anybody they want to sponsor during this window. Take a listen to my recent podcast on H-1B Lottery Planning, Part 1 and Part 2, for a general explanation of how this year’s process will work and how best to prepare.
Planning is key for implementing a successful immigration strategy. As always, I suggest you consult with an experienced immigration attorney ASAP to help get organized for registering your H-1B candidate for the March lottery and doing as much prep work as possible so that you can put together a strong H-1B petition in the event your candidate is selected in the lottery.
An attorney will also be up to date on all the recent changes to immigration policy, such as USCIS rescinding a Trump-era policy that went into effect in 2017 that effectively made computer programming positions ineligible for an H-1B visa. You will also want to discuss backup options for the international student employee if they are not selected in this year’s lottery.
Image Credits: Joanna Buniak / Sophie Alcorn (opens in a new window)
Registration and lottery process
Recently, U.S. Citizenship and Immigration Services (USCIS) announced it will delay until next year the plan to shift from a random H-1B lottery to a wage-based one that would have selected registrants who would be paid the highest wage for their position and location. In January, the previous administration had finalized the rule implementing the wage-based lottery. The latest announcement ended weeks of speculation whether USCIS under the Biden administration would retain a wage-based H-1B allocation process, which falls in line with President Biden’s presidential campaign platform.
The random H-1B lottery in March means that H-1B candidates with the same education level who will be paid more will have no greater advantage than those being paid less. However, next year that may not be the case.
Regardless of whether there’s a random or wage-based lottery, individuals with a master’s or higher degree from a U.S. university will continue to have the best chance of being selected in the H-1B lottery. The annual cap on H-1Bs remains at 85,000 and of those, 20,000 H-1Bs are reserved for individuals with a master’s degree or higher from a U.S. university. USCIS randomly selects enough registered candidates from the entire pool of registrants to reach the 65,000 regular H-1B cap first. Then it randomly selects another 20,000 registered candidates holding a U.S. master’s degree or higher, in what is called the advanced-degree cap exemption. Therefore, individuals with a U.S. advanced degree have two chances to be selected. To be eligible, your international student employee must have earned their advanced degree from an eligible and accredited U.S. institution by the time the H-1B petition is filed.
After the online registration period closes on March 25, USCIS will conduct a random computerized selection of registrations and will notify those selected by March 31. A completed H-1B petition must be filed within 90 days of being notified that the H-1B candidate was selected in the lottery, which means the filing deadline will be June 30.
In order to register your candidate for the H-1B lottery, your company will need to set up an online USCIS account if it does not already have one. This can be done at any time between now and the end of the registration period. Your attorney can help you with this and the online registration process.
For the online registration process, your company will have to provide the following information:
- Full legal name of the candidate.
- Gender.
- Date of birth.
- Country of birth.
- Country of citizenship.
- Passport number.
- If the candidate is eligible for inclusion in the U.S. advanced-degree cap.
In addition, your company will have to pay the $10 registration fee, which can be submitted by entering a credit card, debit card, checking or savings account directly into the H-1B registration portal.
Tips for preparing
Generally, your startup and your H-1B candidate should start assembling documents you will need to submit. Your startup will need to get its tax identification number verified by the U.S. Department of Labor to prove that your startup is capable of sponsoring an individual for an H-1B. This needs to be done before your company can submit a Labor Condition Application (LCA), which is also sent to the Labor Department. An approved LCA must be submitted with your H-1B petition to USCIS. In addition to your startup’s tax ID, it will need the following:
- If your startup formed recently, articles of incorporation, pitch deck, business plan, term sheet, cap tables.
- Documentation showing your company can pay the prevailing wage for the H-1B candidate’s position and location: bank statements, tax returns, other financial documents.
- Documents to prove your company is operating within the normal course of business, including marketing materials, company reports, screenshots of the company website.
- Job offer letter to the H-1B candidate, including job title, detailed duties, benefits, salary and start date.
- Minimum requirements for the position.
Your H-1B candidate will need:
- An up-to-date resume.
- Originals of diplomas, certificates, and transcripts (also scanned copies).
- Past immigration documents, such as Form I-20 (certificate of eligibility for F-1 student status) or Form DS-2019 (certificate of eligibility for J-1 status.
- Translations of any documents not in English along with a certified translation document.
For tips for filing the H-1B petition, listen to my podcast episodes on “Your Startup’s First H-1B” and “What Makes a Strong H-1B Petition.” Your attorney will be able to make the case that your H-1B candidate and the position your startup is offering meet the requirements of the H-1B specialty occupation visa.
As of now, premium processing for H-1B petitions remains available. Currently, USCIS is severely backlogged in all case types, so I often suggest using it, depending on the H-1B candidate’s start date and current geographic location. With premium processing, which is an optional service for a $2,500 fee, USCIS guarantees it will make a decision on a case within 15 days. If USCIS approves your H-1B petition, the earliest the international student employee can begin working under the H-1B visa is Oct. 1, 2022, which is the first day of the federal government’s new fiscal year.
Fingers crossed for you in this year’s H-1B lottery
All the best,
Sophie
Have a question for Sophie? Ask it here. We reserve the right to edit your submission for clarity and/or space.
The information provided in “Dear Sophie” is general information and not legal advice. For more information on the limitations of “Dear Sophie,” please view our full disclaimer. You can contact Sophie directly at Alcorn Immigration Law.
Sophie’s podcast, Immigration Law for Tech Startups, is available on all major platforms. If you’d like to be a guest, she’s accepting applications!
TC Early Stage: The premier how-to event for startup entrepreneurs and investors
From April 1-2, some of the most successful founders and VCs will explain how they build their businesses, raise money and manage their portfolios.
At TC Early Stage, we’ll cover topics like recruiting, sales, legal, PR, marketing and brand building. Each session includes ample time for audience questions and discussion.
Use discount code ECNEWSLETTER to take 20% off the cost of your TC Early Stage ticket!
Powered by WPeMatico
11 words and phrases to cut from your VC pitch deck
You have just 170 seconds. Weeks or even months of working on your pitch deck could come down to the 170 seconds (on average) that investors spend looking at it.
“Investors see a lot of pitches,” VC and LinkedIn co-founder Reid Hoffman noted. “In a single year, the classic general partner in a venture firm is exposed to around 5,000 pitches … and ends up doing between zero and two deals.”
With all that pressure to make an impact quickly, founders spend an incredible amount of time on the design of their slides. Less consideration, however, is usually spent on the words on the slide. That’s a mistake, especially when you only have 170 seconds.
Founders spend an incredible amount of time on the design of their slides. Less consideration, however, is usually spent on the words on the slide. That’s a mistake.
When not used intentionally, the words in your deck can be distracting or downright off-putting. We used what we know about language and healthy communication from the millions of documents we’ve processed at Writer to come up with 11 words and phrases to remove from your VC pitch deck.
Negative associations
1. “runway”
Pitching VCs is a balancing act: You want to position your idea in the best light, but also show that you’ve thought things through. However, volunteering certain types of information can have the opposite effect. Don’t write: I’m seeking $X in funding to provide Y months of runway. You certainly need to show how you’re going to use the funding you’re asking for, but you don’t want to frame things in terms of runway in a pitch deck. The word is associated with a looming cash-out date, which can put an investor in a negative state of mind.
This HappySignal slide is a solid example of keeping your messaging positive and using uplifting language.
2. “exit strategy”
Don’t write: Our exit strategy is … . Yes, thinking through your business means knowing how you’ll handle worst-case and best-case scenarios. But putting exit strategy in your deck can only get investors thinking about the inherent risks. You want them focused on the opportunity. You need to know what to say when the topic comes up — just don’t volunteer the information on a slide.
Clichés
3. “just X percent”
A pitch deck is a tool to show VCs why your idea merits investment. Using clichés can work against that goal. Don’t write: If we could capture X percent of the market … . It’s not only a cliché, it’s wishful thinking — not a plan. Keep the text on your slides grounded in relevant facts and figures. Other clichés to cut include: the Amazon of X, imagine a future and moving Y to blockchain.
Absolutes
Powered by WPeMatico
Facebook can save itself by becoming a B Corporation
As Facebook confronts outrage among its employees and the public for mishandling multiple decisions about its role in shaping public discourse, it is becoming clear that it cannot solve its conundrums without a major change in its business model. And a new model is readily available: for-benefit status.
For decades, a misguided ideology has warped companies, economies and societies: that the sole purpose of corporations is to maximize short-term returns to one set of stakeholders — those who have bought shares. Neither law nor history requires this to be true.
But shareholder value-maximization ideology has become cemented in far too much corporate practice at the expense of societal well-being. This is manifested in many ways: a slavish adherence to the judgment of the “market,” even when other social signals are more powerful; executives enriched by stock options; companies fearful of “activist investors” who attack whenever stock prices fail to meet quarterly “expectations” and often-frivolous shareholder lawsuits pushing for stock gains at all costs.
The pandemic, however, has accelerated an already-spreading recognition that shareholder value maximization is often a harmful choice — not by any means a moral imperative or even a fiduciary responsibility.
Major institutions of capitalism are converging on a new vision for it. The 2019 Business Roundtable CEO statement said that corporate strategy should benefit all stakeholders – including shareholders, yes, but equally customers, employees, suppliers, and the communities in which companies operate. BlackRock CEO Larry Fink’s recent annual letters assert new views of how that investment company, the world’s largest, should invest the trillions it oversees.
Fink’s 2019 letter spelled out a new vision for corporate purpose; the subsequent 2020 and 2021 letters focused on business’ responsibility around climate change, particularly in light of the pandemic. The B Corporation and conscious capitalism movements are growing. The World Economic Forum is championing a “Fourth Sector,” combining purpose with profit. Business schools, facing student rebellions against a purely profit-maximizing curriculum, are rapidly changing what they teach.
And with society under siege, many more businesses, including social media, are scrambling to seem like good corporate citizens. They have no choice.
Facebook, for example, has doubled down on philanthropy and new efforts to combat misinformation, even as usage and share price soar. Platforms like WhatsApp (owned by Facebook) have become essential services to connect people whose physical ties have been abruptly severed during the global pandemic. Shelter-in-place has become, in many ways, shelter-in-Facebook-properties.
But Facebook and its brethren remain fragile. Since the 2016 presidential election in the U.S., Facebook has faced governmental hearings and regulation, public uproar (#deleteFacebook), and huge fines for invading privacy and undermining democracy. These calls were amplified in the weeks following the January 6 Capitol riot. Separately, it faces allegations of bias, largely (though not entirely) from the political right. These have led to calls for the revocation or reform of Section 230 of the Communications Decency Act, which grants it immunity from the actions of its users.
A giant company that is simultaneously essential and pilloried is vulnerable. Just ask the ghosts of John D. Rockefeller and his fellow robber barons, whose huge monopolies industrialized America more than 100 years ago. Journalistic muckrakers and public outrage targeted them for their abusive practices until the government finally broke up their companies via antitrust legislation.
Because Mark Zuckerberg maintains complete majority control of Facebook, he could unilaterally quell public opprobrium and fend off heavy-handed regulation singlehandedly by transforming Facebook into a new kind of business: a for-benefit corporation.
Under the Public Benefit Corporation legal model, firms bind themselves to a public benefit mission statement and carry out required ongoing reporting on both the standard financials and on how the company is living up to its mission. That status protects the company against profit-demanding shareholder lawsuits, and also attracts employees and investors who want to combine profit with purpose.
Data.world is one of the thousands of certified B Corporations that have seen good returns on financial metrics. Allbirds, for example, launched in a few sustainable materials using a pro-sustainability process to manufacture comfortable shoes, quickly reaching revenues of $100 million and valuation of $1.7 billion in an industry fraught with sustainability and human rights concerns. Other household names that are B Corps include The Body Shop, Coursera, Danone, the Jamie Oliver Group, King Arthur Flour, Numi Tea and Patagonia.
Many companies that have not undergone formal B Certification from B Labs have nonetheless done well while transforming their business practices, such as the carpet and flooring company Interface. Some firms incorporate ESG principles into their management systems – the $24 billion (market cap) Dutch life sciences company DSM has for years had meaningful sustainability targets for its senior management that account for fully 50 percent of their annual bonuses. Both Interface and DSM attribute much of their commercial success to their attention to non-financial considerations.
A for-benefit Facebook could similarly relate to the world differently, avoiding many of the reputational shocks and regulatory responses that have led to huge stock dips and enormous fines. Its operations would align with Zuckerberg’s proclaimed purpose to enable the potential abundance that results from connecting everyone in the world.
Imagine a Facebook town hall as a true public square, not just another way to gather and sell people’s data without their explicit consent. Imagine a Facebook that put its users first and its advertisers second; that revealed where ads came from; that earned your attention in a way that you controlled rather than through machine-driven algorithms maximizing your attention for good or ill. Such a for-benefit Facebook could create true buy-in and transparency with its massive community around the world.
Of course, such steps as Facebook’s new Oversight Board, which may provide some meaningful review, don’t require a legal change. But if shareholders and employees continue to be rewarded primarily by the success of the problematic ad revenue model, a continuing conflict between private gain and public benefit makes it impossible to have confidence about what is happening behind the scenes. A shift to for-benefit incorporation and appropriate certification brings with it different performance metrics and accountability systems with public scores.
In changing Facebook into a for-benefit corporation, Zuckerberg could insulate himself against presidential rage while rehabilitating his reputation — and his company’s. It would likely create vast ripples both in Silicon Valley and beyond — and it might help transform capitalism itself.
Powered by WPeMatico
Create a handbook and integrate AI to onboard remote employees
The pandemic has forced organizations across the globe to shutter the office environment, and take up a remote-first strategy. Through necessity, professionals have adapted to remote working. But the systems they use are still playing catch up.
One area less readily accommodating to the remote environment is the onboarding process. Given that it is the first sustained contact that a new starter has with a company, a remote-first strategy is dependent on its success. When looking to onboard new employees, the luxuries of first-day meet and greets, in-person hardware setup, and a team lunch are no longer available. From interview to offer-letter and beyond, any new hire’s early journey is critical to their life at the company, their job satisfaction and ultimately their productivity. The remote induction must be a smooth process, and so needs a thorough rethink.
A cultural shift in the company may be necessary. Organizations need to embrace knowledge-sharing and collaboration, by turning to a “handbook first” approach. A few simple steps can lead them there. Companies also need to analyze their workflow. Are the right systems in place to ensure the seamless flow of both tacit and explicit knowledge?
Perhaps most importantly, artificial intelligence can help transform a clunky old onboarding process into a sophisticated, smooth journey. Naturally the best AI models to use will depend on the business, and department in question. However, with a few pointers business leaders can carve out a path to AI integration.
Let’s dive into the specifics that can transform the remote onboarding process, for the benefit of both the company and the new starter in question.
How to handbook
This is arguably the most important piece of the puzzle when it comes to ensuring newcomers are able to access the right information at the right time; it’s also the most difficult to get right. It is for workers at all levels of an organization to think about how knowledge is shared between teams, and the processes which surround that interchange of ideas.
What is most important is that everyone in an organization prioritizes documentation; exactly how they do it is secondary. You can spin up plenty of free and paid softwares to start creating a handbook. Anything cloud based is suitable, with more sophisticated paid options recommended to keep things easily searchable with documentation sorted into well defined hierarchies, rather than losing those nuggets of information in a sea of folders.
However, this systemic challenge is best addressed from top down. The process should include some checks and balances, with permissioning crucial for parts of the handbook which should remain static, like policies and SLPs. Other parts of the documentation should be kept flexible, like processes and team level knowledge. The majority of the handbook must be democratized as far as possible.
Gitlab, an all-remote company, first coined the term “handbook-first.” The DevOps software provider acts as a great example of a company that lives and breathes through documenting and codifying internal knowledge. Everyone within the organization buys into the mantra of documenting what they know, with subject matter experts assigned to manage knowledge base content. Keeping company documentation up to date is a collaborative task, considered paramount to the company’s livelihood. Softwares give a helping hand, nudging contributors to keep information up to date.
Darren Murph, Head of Remote at GitLab, says that their documentation strategy, twinned with a cooperative approach, helps to build trust with new starters. “When everything a new hire needs to know is written down, there’s no ambiguity or wondering if something is missing. We couple documentation with an Onboarding Buddy – a partner who is responsible for directing key stakeholder conversations and ensuring that acclimation goes well.”
Powered by WPeMatico
6 tips for SaaS founders who don’t want VC money
Over the past decade, venture capital has become synonymous with entrepreneurship. Founders from around the world arrive in Silicon Valley with visions of record-setting A rounds and billion-dollar valuations. But what if you don’t have unicorn dreams — or you don’t want to pursue VC money?
Bootstrapping a SaaS company is not only possible — I believe it’s a saner, more sustainable way to build and scale a business. To be clear, bootstrapping isn’t always easy. It requires patience and focus, but the freedom to create a meaningful product, on your terms, is worth more than even the biggest VC check.
The freedom to create a meaningful product, on your terms, is worth more than even the biggest VC check.
I started my company, JotForm, in 2006. We’ve grown steadily from a simple web tool into a product that serves more than 8 million users — without taking a dime in outside funding. We’re profitable in an industry with big-name competitors like Google.
Most importantly, I still love this company and its mission, and I want the same for my fellow entrepreneurs. If you’re a SaaS founder who’s wary of VC funding, here are my best bootstrapping tips.
Keep your day job
Success stories from founders who leap blindly into business without resources or relevant experience are compelling, but they’re the exception, not the rule. Working inside another organization can build your skills, your network and even inspire great product ideas.
After finishing college with a computer science degree, I worked as a developer for a New York media company. The editors always needed custom web forms, which were tedious and time consuming to build. I kept thinking, “There has to be a better way.”
That daily frustration led me to start JotForm — but I didn’t leave my job right away. I stayed with the media firm for five years and worked on my product on the side. By the time I was ready to go all in, I had the confidence, experience and savings I needed.
Many of the world’s biggest companies began as side projects, including Twitter, Craigslist, Slack, Instagram, Trello, and a little venture called Apple. If your day job doesn’t pay enough to fund the early stages of your business, consider a side gig or consulting work. There are so many ways to set yourself up for success without the pressure of VC cash or selling a chunk of your business.
Know you’re not alone
The exact numbers shift every year, but data compiled by Fundable show that only 0.05% of U.S. startups are backed by VCs. Another 0.91% are funded by angel investors. The vast majority, at 57%, are funded by credit and personal loans, while 38% get funding from friends and family.
It may feel like most founders raise multimillion-dollar rounds, but that’s simply not the case. It’s also good to remember that securing VC money is complicated and time consuming. You can spend months taking meetings and presenting the perfect deck — and still leave empty handed. Be patient and stick to your own path.
Measure profits, not popularity
SaaS founders often emphasize vanity metrics, like user acquisitions and total downloads. These numbers can measure short-term popularity, but they don’t reveal how users and customers feel about your product — or your long-term potential.
Powered by WPeMatico
Dear Sophie: Which immigration options are the fastest?
Here’s another edition of “Dear Sophie,” the advice column that answers immigration-related questions about working at technology companies.
“Your questions are vital to the spread of knowledge that allows people all over the world to rise above borders and pursue their dreams,” says Sophie Alcorn, a Silicon Valley immigration attorney. “Whether you’re in people ops, a founder or seeking a job in Silicon Valley, I would love to answer your questions in my next column.”
Extra Crunch members receive access to weekly “Dear Sophie” columns; use promo code ALCORN to purchase a one- or two-year subscription for 50% off.
Dear Sophie:
Help! Our startup needs to hire 50 engineers in artificial intelligence and related fields ASAP. Which visa and green card options are the quickest to get for top immigrant engineers?
And will Biden’s new immigration bill help us?
— Mesmerized in Menlo Park
Dear Mesmerized,
I’m getting this question quite frequently now as more and more startups with recent funding rounds are looking to quickly expand. In the latest episode of my podcast, I discuss some of the quickest visa categories for startups to consider when they need to add talent quickly.
As always, I suggest consulting with an experienced immigration lawyer who can help you quickly strategize and implement an efficient and cost-effective hiring and immigration plan. An immigration lawyer will also be up to date on any immigration policy changes and plans in the event that the Biden administration’s U.S. Citizenship Act of 2021 passes. It was introduced in the House and Senate this month.
That proposed legislation would enable more international talent to come to the U.S. for jobs and clear employment-based visa backlogs, among other things. Given the legislation’s substantial benefits offered to employers, I encourage your startup — and other companies — to let congressional representatives know you support it.
Image Credits: Joanna Buniak / Sophie Alcorn (opens in a new window)
Given that most U.S. embassies and consulates remain at limited capacity for routine visa and green card processing due to the pandemic, it is generally quicker to hire American and international workers who are already in the U.S. Although U.S. Citizenship and Immigration Services (USCIS) is experiencing substantial delays in processing cases due to the coronavirus, as well as an increase in applications, Premium Processing is currently available for most employment-based petitions. We are still able to support many folks with U.S. visa appointment scheduling at consulates abroad using various national interest strategies.
With all of that in mind, here are the visa categories that offer the quickest way to hire international talent.
H-1B transfers
Hiring individuals by transferring their H-1B to your startup can be completed in a couple of months with premium processing. Premium processing is an optional service that for a fee guarantees USCIS will process the petition within 15 calendar days.
What’s more, H-1B transferees can start working for your startup even before USCIS has issued a receipt notice or made a decision in the case. You just need to make sure that USCIS received the petition, which is why I always recommend sending all packages to USCIS with tracking.
Premium processing can help to get a digital receipt as the paper receipts are often backlogged. I stopped suggesting this route during the Trump administration, but am feeling more comfortable providing it as an option under the Biden administration. The H-1B is the only type of visa that allows somebody to start working upon the filing of a transfer application.
Powered by WPeMatico
RIBS: The messaging framework for every company and product
Over more than two decades of advising founders, I’ve heard all kinds of stories — good, bad and everything in between. While everyone is different, I’ve noticed that the very best stories have something in common: They pass the RIBS test. I’ve talked a lot about this over the years, and it’s stood the test of time and trends.
The test is designed to tell you if your story is memorable (will it “stick to your ribs?”) so you can turn it into a compelling message. It looks something like this:
- Relevant
- Inevitable
- Believable
- Simple
Relevant
Before you can come up with a good story, you need to think about the audience. Who are you trying to reach? Are you solving a problem they care about? What matters to them about that problem? Why does your solution deserve attention?
The test is designed to tell you if your story is memorable (will it “stick to your ribs?”) so you can turn it into a compelling message.
Marc Benioff could have launched Salesforce by describing it as an online way for companies to manage relationships with their customers. It’s true and it would have been interesting, at least to some people. But instead, Marc went bigger: He ran a campaign that described Salesforce as the “end of software.”
At the time, software was everywhere and it was creating all kinds of problems: It was massively expensive, time consuming and prone to failure. By taking on those issues, Marc made the company instantly more relevant to a bigger market and audience. The conversation went from a discussion of feature checklists, contacts and leads, to how an entire industry would change. Marc looked like a visionary — and Salesforce seemed revolutionary.
Inevitable
Powered by WPeMatico
Why I felt fine about not disclosing my pregnancy to investors
I closed two major rounds of funding for my geothermal energy startup, Dandelion Energy, while pregnant. I did not disclose either pregnancy to my investors during the fundraising process either time. I felt fine doing this, and I believe other founders should feel free to keep their pregnancies private as well if they’d prefer to.
No one would think twice about a male founder who declined to share the details of his health or family status with investors during an initial fundraising meeting. On the contrary, it would be an unusual move for him to do so.
For some context, my co-founder and I spun our startup, Dandelion Energy, out of Alphabet’s X in April 2017 and raised our first small round of outside funding that summer. Our goal was to set up a commercial pilot and start selling and installing heat pumps to demonstrate that our product worked and show that there was demand for affordable geothermal before we raised a larger round. We had to prove that our business was viable.
No one would think twice about a male founder who declined to share the details of his health or family status with investors during an initial fundraising meeting.
That same summer, in 2017, I became pregnant.
Round one
As summer turned to fall, I had to figure out how to approach being pregnant while raising Dandelion’s second round of funding. I was lucky to be able to choose whether to tell people I was pregnant because it turned out I didn’t end up looking visibly pregnant until about seven months in, and even then I could dress to make it nonobvious. Without knowing anyone who’d gone through a similar experience, I had to decide how I would handle my status as a pregnant person when speaking with investors.
At first, it worried me that I would be hiding something if I didn’t disclose my pregnancy. But I really didn’t want to. I was a first-time entrepreneur with no real track record. Oh yeah, and I was a woman. And almost all of the investors were men who typically funded men.
Especially early on in a startup’s life, these investors are judging the founder as much as the business. Making an impression is key, and “pregnant” didn’t strike me as accretive in any way to my ability to deliver the type of impression that would lead to investment in my business (I hope this changes over time, but I am being honest about how things seemed to me).
And then there was this: Even if I had decided to tell investors I was expecting, how could I broach the topic in a way that wouldn’t threaten to derail the entire tenor of the meeting? I was meeting most of these people for the first time and had a limited amount of time to spend explaining payback periods and vapor compression refrigeration cycles. It seemed like the best-case scenario was if disclosing pregnancy made the meeting no worse than it would otherwise have been. In no world could I imagine it would be a net positive.
Given all of this, I made the decision to not talk about it. It worked out for me. As soon as I started showing, around seven months in, everyone left their offices for the holidays, and so I was never forced to address what was becoming visibly obvious.
But of course there was a downside to my approach. I would have to tell them eventually, and I’d pushed it off so long that by the time I finally got around to it we basically had to have a conversation like this:
Me: “Some happy news to share: I’m pregnant!”
Investors: “Congratulations! We are so thrilled for you! When’s the due date?”
Me: “Ahhh … Next month.”
Happily, all of them were extremely supportive and gracious when I told them. Their uncomplicated and positive acceptance of the news even made me wonder if all my internal wrangling about whether to tell investors had been unnecessary. I gave birth to my daughter literally one day after the money was wired.
Round two
Time passed and it became clear we were ready to raise our next round of funding. Also, I become pregnant again. This time, most of the fundraising happened in the early stages of my pregnancy. Early enough that I hadn’t even really told my friends, so it was obvious to me I wouldn’t be telling investors I was just meeting. After having gone through it once before, it was an easier decision the second time around.
Looking back
Reflecting on my experience, I do think it helped that I got to know my investors throughout the fundraising process, so by the time I told them I was pregnant, they already knew me and I had already established my credibility as an entrepreneur. Being pregnant was just something going on in my life; it didn’t define who I was to them. That is one advantage of introducing it later: It did not define me because they knew so much else about me by that point.
In many ways, I am a stereotypical founder: I have a CS degree from Stanford, I worked as a PM at Google, I have an engineering background. I have many advantages. Yet, more present in my mind during fundraising were the parts of my identity that seemed atypical, and the primary aspect here was my being a woman.
Because there is so much conversation about how women receive so much less investment, I was worried that being a woman would be a disadvantage, and there’s nothing like being pregnant to highlight in the strongest possible way that you’re a woman.
I now feel lucky to know other founders who have raised money while visibly pregnant, and so I’ve seen firsthand that it’s possible. But it is not something that a pregnant founder should feel obligated to disclose. I hope that it becomes common for women to start businesses and raise capital for those businesses in every stage of their lives, including when they’re pregnant.
Because as soon as the pregnant woman and the guy with the hoodie both seem equally probable as startup founders, it will suddenly matter much less whether to talk about your pregnancy.
Powered by WPeMatico
Winning enterprise sales teams know how to persuade the Chief Objection Officer
Many enterprise software startups at some point have faced the invisible wall. For months, your sales team has done everything right. They’ve met with a prospect several times, provided them with demos, free trials, documentation and references, and perhaps even signed a provisional contract.
The stars are all aligned and then, suddenly, the deal falls apart. Someone has put the kibosh on the entire project. Who is this deal-blocker and what can software companies do to identify, support and convince this person to move forward with a contract?
I call this person the Chief Objection Officer.
Who is this deal-blocker and what can software companies do to identify, support and convince this person to move forward with a contract?
Most software companies spend a lot of time and effort identifying their potential buyers and champions within an organization. They build personas and do targeted marketing to these individuals and then fine-tune their products to meet their needs. These targets may be VPs of engineering, data leaders, CTOs, CISOs, CMOs or anyone else with decision-making authority. But what most software companies neglect to do during this exploratory phase is to identify the person who may block the entire deal.
This person is the anti-champion with the power to scuttle a potential partnership. Like your potential deal-makers, these deal-breakers can have any title with decision-making power. Chief Objection Officers aren’t simply potential buyers who end up deciding your product is not the right fit, but are instead blockers-in-chief who can make departmentwide or companywide decisions. Thus, it’s critical for software companies to identify the Chief Objection Officers that might block deals and, then, address their concerns.
So how do you identify the Chief Objection Officer? The trick is to figure out the main pain points that arise for companies when considering deploying your solution, and then walk backward to figure out which person these challenges impact the most. Here are some common pain points that your potential customers may face when considering your product.
Change is hard. Never underestimate the power of the status quo. Does implementing your product in one part of an organization, such as IT, force another department, such as HR, to change how they do their daily jobs?
Think about which leaders will be most reluctant to make changes; these Chief Objection Officers will likely not be your buyers, but instead the heads of departments most impacted by the implementation of your software. For example, a marketing team may love the ad targeting platform they use and thus a CMO will balk at new database software that would limit or change the way customer segment data is collected. Or field sales would object to new security infrastructure software that makes it harder for them to access the company network from their phones. The head of the department that will bear the brunt of change will often be a Chief Objection Officer.
Is someone’s job on the line?
Another common pain point when deploying a new software solution is that one or more jobs may become obsolete once it’s up and running. Perhaps your software streamlines and outsources most of a company’s accounts payable processes. Maybe your SaaS solution will replace an on-premise homegrown one that a team of developers has built and nurtured for years.
Powered by WPeMatico
Why do SaaS companies with usage-based pricing grow faster?
Today we know of HubSpot — the maker of marketing, sales and service software products — as a preeminent public company with a market cap above $17 billion. But HubSpot wasn’t always on the IPO trajectory.
For its first five years in business, HubSpot offered three subscription packages ranging in price from $3,000 to $18,000 per year. The company struggled with poor churn and anemic expansion revenue. Net revenue retention was near 70%, a far cry from the 100%+ that most SaaS companies aim to achieve.
Something needed to change. So in 2011, they introduced usage-based pricing. As customers used the software to generate more leads, they would proportionally increase their spend with HubSpot. This pricing change allowed HubSpot to share in the success of its customers.
In a usage-based model, expansion “just happens” as customers are successful.
By the time HubSpot went public in 2014, net revenue retention had jumped to nearly 100% — all without hurting the company’s ability to acquire new customers.
HubSpot isn’t an outlier. Public SaaS companies that have adopted usage-based pricing grow faster because they’re better at landing new customers, growing with them and keeping them as customers.
Image Credits: Kyle Poyar
Widen the top of the funnel
In a usage-based model, a company doesn’t get paid until after the customer has adopted the product. From the customer’s perspective, this means that there’s no risk to try before they buy. Products like Snowflake and Google Cloud Platform take this a step further and even offer $300+ in free usage credits for new developers to test drive their products.
Many of these free users won’t become profitable — and that’s okay. Like a VC firm, usage-based companies are making a portfolio of bets. Some of those will pay off spectacularly — and the company will directly share in that success.
Top-performing companies open up the top of the funnel by making it free to sign up for their products. They invest in a frictionless customer onboarding experience and high-quality support so that new users get hooked on the platform. As more new users become active, there’s a stronger foundation for future customer growth.
Powered by WPeMatico