Ben and David return to make their first foray into enterprise software, covering Salesforce’s $2.5B acquisition of ExactTarget in 2013 with the help of special guest and ExactTarget cofounder & CEO, Scott Dorsey.   Technical note: due to an issue we didn’t catch during recording, audio quality is significantly lower than usual for this episode (especially David’s voice). We apologize but hope you’ll give it a chance anyway— Scott offers great wisdom & insights, and the ExactTarget success story is a inspiring one underdog entrepreneurs, especially (but not limited to!) anyone located in the Midwest or elsewhere outside of traditional "Silicon Valley-style” tech hubs.
 

Sponsors:

Anthropic: https://bit.ly/acquiredclaude25
ServiceNow: https://bit.ly/acquiredsn
Vanta: http://vanta.com/acquired
Statsig: https://bit.ly/acquiredstatsig25

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Topics covered include: 

• The decision to start ExactTarget post-internet bubble and in Indianapolis, with zero software experience between Scott and cofounders Chris Baggott & Peter McCormick
• Raising initial money from friends & family, followed by early investment and mentoring from Indianapolis venture pioneer Bob Compton
• Building and scaling a great sales organization within a technology company
• The importance of focusing early on a clearly defined target market (SMBs in the case of ExactTarget), and then “stair-stepping” up as the product and business scale grow over time
• ExactTarget’s unsuccessful first IPO filing during the financial crisis
• Building a "capital-efficient” early stage company, and the value of raising growth capital at the right time to step on the accelerator
• The value of “secondary” investments allowing founders, employees & early investors to “stay hungry” by achieving some liquidity along the way
• When and how to expand internationally and the importance of strategic resellers
• ExactTarget’s second successful IPO filing and life as a public company with quarterly financial reporting to Wall Street
• How the acquisition process played out with Salesforce and other bidders (including reference to ExactTarget’s incredible SEC filing detailing the entire negotiation—scroll down to "Background and Reasons for the ExactTarget Board’s Recommendation”, starting at the bottom of page 13)
• Approaching the difficult task of integrating a major acquisition involving thousands of people
• The fun story of ExactTarget’s winning Microsoft as a large customer—including actual sledgehammers
• Scott’s new Indianapolis-based venture studio, High Alpha
• Plus as always the "hard hitting" analysis across acquisition category, what would have happened otherwise, tech themes—and final grading

  The Carve Out 

• Ben: The Talk Show live at WWDC 2016 with Phil Schiller & Craig Federighi
• David: The Score Takes Care of Itself by legendary 49ers coach Bill Walsh, originally recommended by Jack Dorsey [no relation to Scott :) ] at YC Startup School '13
• Scott: 2016 Scipps National Spelling Bee, including one of the finalists’ favorite words: indefatigable

  Followups: 

• Instagram’s incredible user numbers announcement: 500M monthly active users / 300M daily active users