The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
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Drive Capital is the only venture firm with scale in the Midwest
“We have drive capital in Columbus, which is excellent and a great team. They're putting meaningful capital to work in the Midwest, but really outside of drive, we have very little scale of capital and that makes it more challenging for our company.”
Dorsey: Salesforce CEO Marc Benioff is an excellent manager
“What most people may not know is he's actually an excellent manager.”
Dorsey: Salesforce operated at a faster pace than ExactTarget
“We felt like we operated at a fast pace at ExactTarget, and the pace at Salesforce was even faster”
Dorsey: High Alpha Capital likely to invest in all Studio graduates
“So another way to put it is we're likely to invest in every one of our companies that come out of the high alpha studio.”
High Alpha requires up to 50 customer calls before greenlighting a startup
“So even before we decided to green light a new company, we were looking for 25, 30, 40, 50 customer conversations to really validate that we're solving a true problem.”
True product-market fit requires selling to buyers with no prior relationship
“But when you know you have product market fit is when you start selling organizations where you have no prior relationship, you know, they're not friendly.”
Most early-stage SaaS startups underprice their products due to low confidence
“Most early stage SaaS companies under, underprice their offering, and I think it's maybe lack of confidence, or lack of enterprise experience, or understandably so, being timid about a small feature set That you're putting into the market.”
ExactTarget scaled accounts from $2,000 to $10M+ on a single codebase
“You know, back in our day at ExactTarget, we were able to sell to small businesses, often two, three, four, 5000 per year, and then we're able to sell to very large enterprises. Some of our accounts were north of ten million dollars a year, and it was essentia…”
Scott Dorsey: Biggest VC Challenge for Former Operators Is Giving Up Control
“So for me, and I think for all of us at high alpha being former operators, the biggest challenge is encouraging and nudging and trying to use our powers of persuasion, you know, to help these companies move in the direction we think is the right direction, but…”
Dorsey: Midwest tech startups must grow executive talent internally or import it
“You've got a smaller pool of software executives in the Midwest. And as a result, you have to either grow your own or pull them in from other parts of the country.”
Dorsey: High Alpha's venture studio model requires 5 to 10 years to prove out
“You know, we're not going to know whether the high alpha model works for, I mean, truly probably five, seven, 10 years when these companies hopefully break out and become, you know, meaningful and very big success stories.”
High Alpha Studio plans to launch 8-10 cloud startups in four years
“One is High Alpha Studio, and that's a startup studio focused on starting new enterprise cloud companies, and we've signed up to start eight to 10 new enterprise cloud companies over approximately a four-year period of time.”
Scott Dorsey: High Alpha is backed by Emergence Capital and Hyde Park
“We're funded by Emergence Capital out of the Bay Area, Gordon Ritter, phenomenal cloud investor and friend and entrepreneur. It was our lead investor, and then Hyde Park out of Chicago, and we have about 20 to 25 of us, designers, developers, analysts, subject…”
High Alpha targets SaaS gross margins above 80%
“And we look for gross margins, you know, north of 80%. If you have a strong services component, then probably north of 70%.”
Dorsey: Some High Alpha startups achieve gross margins above 90%
“Some of our companies are running north of 90%, which is really outstanding because it just gives you more money to be able to invest in R&D, invest in go to market, and really scale the business in a meaningful way.”
Scott Dorsey reveals Greenspring Associates as High Alpha Capital's lead LP
“Our lead LP is a green spring and associates out of Baltimore, a terrific fund to fund investor.”
Dorsey: ExactTarget struck out with every VC before Bob Compton invested
“Bob was our first investor and exact target. Served as chairman for the first seven or eight years of our company's life. And he was the one angel investor with a great software and VC background that believed in us when literally nobody else did Harry. So we …”