August 8, 2013
I’ve observed, commentated upon and helped out a number of startup companies over the years and have always been interested in the apparently random differences between companies that ride the rocket ship into commercial success and those who.. don’t. Often there are factors beyond the company’s control – competitors, market shifts, economic changes and the like. But it’s also interesting watching the apparent ease with which seasoned entrepreneurs follow the playbook for success. The differences that can be observed between an efficient entrepreneur and one who may be effective but achieves effect through brute force, are stark.
Case in point is SOASTA, the cloud and mobile testing company (more on them here). Tom Lounibos is the CEO of SOASTA and is one of these serial entrepreneurs who make build a business look easy – he’s already been involved in two successful tech IPOs having taken Knowledge public in 1987 after having raised $28M and then repeating it again with Sagent who IPOd in 1999 after raising $32M total. He’s looking to do that again with SOASTA and knows that it takes a lot of cash to fuel the runway to a public listing – that got a little easier today with the news that SOASTA has closed a $30M funding round. Joining the round alongside existing investors are Macquarie Capital from Australia and ROTH Capital.
What makes investors like these – not the usual suspects fr tech investing – back a company? Two key factors, firstly the experience and previous success of the key executives as I’ve written about previously. The second factor is just how big an opportunity the company is pursuing. And here again it is interesting to look at what SOASTA is doing. The company sits at the intersection of a few key industry and wider economic trends – the growth of the cloud as a delivery platform, the demand for agility when it comes to creating and deploying mobile solutions and the increasingly fractured nature of enterprise applications – with enterprises using far more individual applications than ever before, deploying them on heterogeneous infrastructures and delivering them to a multitude of form factors, IT needs to ensure that applications will work across all users. This is the space in which SOASTA plays – its web and mobile test automation and monitoring solutions, CloudTest, TouchTest and mPulse, enable everyone across the operations continuum, developers, QA professionals and IT operations teams to test and monitor users.
SOASTA makes it easy for users to create and execute tests, and analyzes the captured user behavior data in real time – the company sells to some of the big name IT customers – Intuit, Microsoft and Netflix among them. They’ve got real revenue, industry recognition (a leader in the Gartner 2013 Integrated Software Magic Quadrant, and honors are this year’s Velocity Conference) and high profile backers. But more importantly perhaps they’ve read and executed upon the technology industry’s success playbook, building a successful company once may be a fluke, the second and third time becomes a habit. It will be interesting to see if SOASTA follows it’s founders previous companies successes.