Fort Collins Startup Success Story:
Indicative / Nimsoft / CA
John Smith
Indicative Founder
The Journey
It’s still going …
2000 - 2002
1997 - 2000
2003 - 2008
2008 - 2010
2010 - Today
Motivation
Understand what drives you
Ø  What is your motivation for starting a company?
Ø  Is it for the love of the technology?
Ø  Is it for the passion to create a business?
Ø  Is it to make a lot of money?
Ø  Something else?
Getting Indicative Started
Started with a product and customers
Ø  Led the development of the Firehunter business in HP and Agilent
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$30M of R&D went into the creation of the Firehunter product over 5 years
Ø  Left Agilent and negotiated a source code license agreement with Agilent for the
Firehunter source code
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Hired an attorney to help negotiate the agreement and create the company
3 month process
Ø  Created the company
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C Corporation in Delaware
Favorable tax treatment for companies headquartered in other states
58% of the Fortune 500 companies incorporated in Delaware
Used a temporary company name - BlazeSlayer
Ø  Started fund raising for the Series A round
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Added employee number 2 – Angela Tucci
Exhaustive due diligence process
Office Location
My Dining Room
Fund Raising Spreadsheet
Track your progress
Fund Raising Tracking VC Tier 1 VC name VC name VC name VC name VC name VC name Tier 2 VC name VC name VC name VC name VC name VC name Out VC name VC name VC name VC name VC name VC name VC name VC name VC name Contacted Initial
Meeting
Scheduled Introductory
Meeting Met the
Received the
Second
Leadership
Business
Meeting
Team Plan Scheduled Second Reviewed the Review the Third Meeting
Meeting Market Opp Competition Scheduled Third
Meeting Met the
Partners Received
Term
Sheet Business Plan
Keep it Short
Ø  Short 10 page document will do
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Shows your understanding of the opportunity, market, competition, plan for success
If you can’t explain it in a short document and Powerpoint then you don’t understand it
well enough
Ø  Detailed presentations for key areas
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Market opportunity, customer segmentation
Competition
Financial plan for the funding and the plan for the exit strategy
Tips:
- Find your market niche that isn’t currently being served well.
- Know your competition really well. If you don’t have a competitor
then you don’t have a business opportunity
- Show how the VCs will get a 4-5x return in 4 years … or better
- Remember: VCs invest in markets and in you!
Getting Indicative Started (continued)
Start with a product and customers
Ø  Bridge Funding through Vista Ventures
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Enabled the hiring of the initial product development and support team – 12 people
Lease the office space – a portion of the top floor of a building
Convert customers from Agilent to Indicative support contracts – signed up 15 customers
Ø  Named the Company - Indicative
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Worked with a marketing firm in Boulder, CO to determine the company name, logo, etc.
Trademarked the name, used it for both the company and the product name
Ø  Found a CEO to lead the business
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Only way to get VC funding
To be successful I needed to be egoless
I took on a variety of roles in the company – led Product Development -> Business
Development -> Sales
Tips:
- To be successful you need to be egoless, take on whatever role is
needed or be fired!
- Use Trinet for all your HR needs
Getting Indicative Started (continued)
Closed the Series A
Ø  Closed Series A round of funding
Ø  $6M round!
Ø  Three VC Investors
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Sutter Hill Ventures (Palo Alto, CA)
Vista Ventures (Boulder, CO)
Sequel Venture Partners (Boulder, CO)
Ø  VCs owned 70%+ of the company
Ø  The odds are against you
Ø  Each VC receives about 1,500 business plans per year
Ø  Each VC was investing in less than 5 businesses per year
Ø  You need at least three VCs to invest in order to complete a Series A round
Tips:
- Who you pick for your attorney is critical – must be respected by
the VCs and their attorney to close the deal
- Cash is King! Get very creative, spend it wisely
Office Location
724 Whalers Way
Team Building
Multi-skilled Talent
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Find the very best talent you can!
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Each person in the company needs to have multi-functional skills
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Software Architects need to be great SEs
Product Managers need to sell
Software Engineers who can be SEs, develop/delivery training and deliver professional services
Triad Model for product leadership
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Product Manager determines “What” is built, Architect determines “How” it is built, Engineering Manager
determines “When” it is built
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Co-location to enable speed
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Tap into CSU for young talent
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Building the “go-to-market” engine is harder than building the product
Tip:
- Only hire A players - very intelligent, creative problem solvers,
tireless hard workers, who don’t depend upon others to do their job
Building the Indicative Business
Challenge to meet the VC expectations
Ø  CEO Change
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First CEO leaves Indicative
VCs bring in an interim CEO – nearly kills the business
VCs conduct a CEO search, hire the next CEO (Lacy Edwards) and close the Series B
round
Ø  Build out the Go-to-Market team
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Hire a VP of Sales who builds out a U.S. based direct sales organization
Sign up reseller partners in EMEA
Replace the VP of Sales
Rebuild the U.S. based direct sales organization
Ø  Meanwhile, continue to build out the Product
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Small team of 5 software developers and 2 QA engineers
Builds functionality faster than our larger competitors (HP, IBM, CA, BMC)
Ø  Close key large deal in EMEA to keep the business alive!
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Company is 50+ people with 60+ customers
Merge Indicative with Nimsoft
Merge two small private companies to accelerate growth
Ø  Merge Businesses
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VCs encourage Indicative management team to merge with another company
Hire an Investment Banker (Pagemill Partners) to shop the company
Nimsoft and Indicative decide to merge
Exhaustive due diligence process
Only the Nimsoft founder and the product development/support team remain
Ø  Integration of Indicative with Nimsoft
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Integrate Indicative product with the Nimsoft performance and availability monitoring
product
Build the new Nimsoft business growing 70% YoY
Turn Nimsoft into the leader in Cloud monitoring – “From the Data Center to Cloud”
Grow the company to 150 employees with 800 customers
Tips:
- Be prepared to take a path that wasn’t part of your plan
- Position your company as the leader for the next big trend
CA Technologies Acquires Nimsoft
$350M acquisition
Ø  CA Technologies Shows Interest
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Deutsche Bank is hired as the Investment Banker
Three month long due diligence process – very time consuming!
CA agrees to acquire Nimsoft for $350M
Ø  Stock Options can now be cashed in!
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VCs get their exit - $$$
Management and employees make some $$$
Ø  Integration of Nimsoft with CA Technologies
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Started as a wholly owned subsidiary for 2 years
Now we are a fast growing Business Unit
We have over 300 employees with over 1100 customers
I’m now the SVP, Nimsoft Business Unit Executive
Tip:
- Invest the money you earn from an IPO or from being acquired
carefully – there are no guarantees you can do it again!
Office Locations
My Dining Room
724 Whalers Way
2721 Council Tree Ave
How could Rocky Mountain Innosphere help?
Remove the obstacles
Ø  Provide office space suitable for high tech startups
Ø  Relationships with Series A VCs and Angel investors to sponsor first
meetings
Ø  Assistance with the funding raising process
Ø  Sample investor presentations
Ø  Sample business plans, market analysis & competitive analysis
presentations
Ø  Industry analyst accounts available to read reports (Gartner, IDC)
Ø  Relationships with the right corporate attorneys
Ø  Relationships with accountants and CFOs
Ø  Relationships with marketing companies
Ø  Help with hiring – relationships with head hunters, talent recruiters
Ø  Establish a CSU intern program for all the companies
Ø  Provide go-to-market experts to help form the right strategy and help
with execution
Ø  Relationships with Investment Bankers