Uncovering the Secret Sauceof a Successful Startup: SendGrid
Navigating the Corporate Journey:
Private to Public to BuyoutJan. 16, 2020; Lakewood Country Club
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SendGrid from Startup to IPO to Sale:A 10-year journey
2009SendGrid Founded in
Boulder, Colorado.
“Isaac, Tim, Jose”
Techstars 2009
accelerator class.
By 2010: 2,000
Customers
12 Employees
2019Purchased by Twilio
Closed 2/1/19 in stock-
for-stock deal
$54.08 final stock
price 1/31/19
201755,000+ Customers
400+ Employees
1B+ emails/day
IPO: 11/15/17
Priced $16.00 per
share
Start Up… …to IPO… …to Sale
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Today’s Speakers
Yancey Spruill Pattie Money Matt Dubofsky
• CEO, Digital Ocean (2019)
• CFO/COO, SendGrid (2015)
• Board member: AllScripts
Healthcare; Zayo; Ping Identity
• Former Engineer & Investment
Banker
• Education: Georgia Institute of
Technology; MBA, Dartmouth
• Chief People Officer, Twilio
• Former CPO, SendGrid (2016)
• Leading Human Resources
roles at multiple firms
• Education: Masters in Human
Resource Development,
Villanova; University of
Memphis
• Partner, Cooley, LLP since
2007: capital markets
transactions; public company
representation; M&A
• SendGrid engagement (2011)
• Formerly with Skadden, Arps
• Education: Brown University;
Harvard Law
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When to go Public? Check the boxes.
Business Fundamentals
Product / Market Fit
Business Fundamentals
Size of Opportunity
Management Team / Succession Planning
Processes / Controls
Alignment with Investors Market Conditions
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When to go Public? Check the boxes.
Business Fundamentals Processes / Controls
Product / Market Fit
Business Fundamentals
Size of Opportunity
Management Team / Succession Planning
Repeatability / Scalability
Infrastructure / Technology / People / Processes
Compensation Plans
SOx Readiness
Alignment with Investors Market Conditions
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The SendGrid Culture
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When to go Public? Check the boxes.
Business Fundamentals Processes / Controls
Alignment with Investors
Timing and Desired Pathfor Investor Liquidity
Alignment with Board
Product / Market Fit
Business Fundamentals
Size of Opportunity
Management Team / Succession Planning
Market Conditions
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Repeatability / Scalability
Infrastructure / Technology / People / Processes
Compensation Plans
SOx Readiness
How to Finance a Private Company
• Financing considerations• Do we need more cash to execute our plans?
• Finding the backers / governance• Tech focused• Building a Board• Risk Appetite• Payback timing and return expectations
• Private financing Rounds: Series A-D• 5 Rounds between 2009-2016• $82M raised
• And then…do we go public? How? When?8
SendGrid from Startup to IPO to Sale: 10-year journey via multiple investment rounds
2009SendGrid Founded
2019Purchased by Twilio
Valuation: $3B
3X+ increase in less
than 15 months
20102,000 Customers
12 Employees
201214,000 Customers
114 Employees
2014-1528,000+ Customers
233 Employees
Sameer Dholakia
named CEO
Series A ($750k)
2009
Valuation <$10M
TechStars
Foundry Partners
Highway 12
201755,000+ Customers
400+ Employees
1B+ emails/day
IPO: 11/15/17
$16.00 per share
Valuation: ~$900M
Series B ($22M)
Valuation: ~$50M
2012
Bessemer
Foundry Partners
Highway 12
Series C ($21M)
Valuation: ~$200M
2014
Bain, Bessemer
Foundry Partners
Highway 12
Series D ($33M)
Valuation: ~$600M
2016
Bain
Series A-1 ($5M)
2010
Valuation <$10M
TechStars
Foundry Partners
Highway 12
Others
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When to go Public? Check the boxes.
Business Fundamentals Processes / Controls
Alignment with Investors Market Conditions
Public Capital Markets Dynamics
Valuation
Product / Market Fit
Business Fundamentals
Size of Opportunity
Management Team / Succession Planning
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Repeatability / Scalability
Infrastructure / Technology / People / Processes
Compensation Plans
SOx Readiness
Timing and Desired Pathfor Investor Liquidity
Alignment with Board
So why and how go public?Consideration Key questions
Financing Do we need more cash?
The Deal Are the markets ready?
Which banks?
Disclosure? Internal / External
Filing / legal process – how / when?
Investor Relations What shareholders do we want?
Who should provide research coverage?
How to educate bankers / analysts / investors?
NYSE vs. NASDAQ? SEND vs. HHHH?
Employees How / when are they informed?
How does this jibe with our “Honest H” value?
“End” of Process When is the market timing just right?
How / at what level do we price?
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Nov. 15, 2017: SEND IPO at NYSE
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Along comes Twilio…
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• IPO Pricing: 11/14/17
• $16.00 / share
• Twilio purchase: 2/1/19
• SEND $54.08 / share final closing price
• 157% stock CAGR 14+ mos
Thank you.
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