1. Scaling To A Billion
With the power of disruption
Zack Urlocker
COO, Duo Security
ZUrlocker@duo.com
Twitter: @Zurlocker

2. Who Am I ?
• Software exec, advisor, investor
• Chief Operating Officer, Duo Security
• DataStax, Hubspot, PagerDuty, Puppet Labs, PubNub…
• Three billion dollar exits
• Zendesk, MySQL, Active Software
• Reformed marathoner

3. Who Am I ?
• Software exec, advisor, investor
• Chief Operating Officer, Duo Security
• DataStax, Hubspot, PagerDuty, Puppet Labs, PubNub…
• Three billion dollar exits
• Zendesk, MySQL, Active Software
• Reformed marathoner
• Bass Player
• Best open source rock opera of 2016

5. Duo Security
• Venture-backed SaaS security
• Protect users, devices, applications
• 75% of customers self-deploy in 24 hrs

6. Four Key Ideas
• Scaling requires repeatable patterns
• Scale after you have market fit
• Disruption changes the game
• Optimize for velocity

7. 90% of Startups Self-Destruct
• Validation takes 2-3x longer
• Wrong-phase errors burn cash, time
$0-$2m $2m-$5m $5m-$15m $15m-$50m $50m-$100m+

8. Most Companies Scale too Fast
• Find a repeatable model
• Make it efficient, then scale
$0-$2m $2m-$5m $5m-$15m $15m-$50m $50m-$100m+

9. Find Repeatable Patterns
• What is driving adoption?
• What are the common problems?
• What are the common traits?
• Industry, title, demographics
• Context, competition
• Lead sources

10. Optimize for Specific Patterns
• Don’t scale until it’s working:
Marketing, sales efforts have a
predictable yield
• Look to continuously improve
performance around patterns

11. Continuously Experiment
• Create a learning culture
• Don’t worry if experiments fail
• Bad news is good news!

12. Beware The False Dawn
• Not every success is repeatable
• Don’t compromise scalability for
one-off successes
• Headcount growth should be
slower than revenue growth

13. Signs You’re Not Scaling
• Every deal is customized
• All decisions made at C-level
• Some reps hit quota, many do not
• Everyone working 60+ hours/week
• More marketing spend has little impact

14. Disruption Changes The Game
• An inferior solution
• For an unattractive market
• That changes the game

15. Are You a Disruptor?
• There is an existing market
• There are underserved users
• You compete on different criteria
• The new business is inherently
unattractive to the incumbents

16. Relational Database Market
• $30b oligopoly market
• Oracle, IBM DB2, SQL Server
• Ingres, Sybase,
Informix…

17. Disrupting the Database Market
MySQL
• Web applications
• Commodity x86
• Free Open Source
• Widespread distribution
• Small footprint
• Fast read-access
Incumbents
• Mission critical
• Expensive hardware
• High prices
• Direct sales model
• Complex features
• TCP benchmarks

18. Are You Being Disrupted?
• Price becomes key
• Trusted plays no longer work
• New products fail to catch on
• Inferior entrants are winning
• Management needs a miracle

19. Velocity Trumps Everything
• Make your product easy to
understand, easy to buy, easy to use
• Every decision has impact on speed
• The faster you get customers to buy,
the more robust your business
When in doubt, simplify

20. What Increases Efficiency?
Efficiency Levers
Increased deal size Higher value markets
Higher value products
Increased win rate Better segmentation
Marketing tools, Sales skills
Lower acquisition cost More inbound marketing
More A/B testing
Better targeting
Lower service costs Better product quality
More one-to-many services
Increased velocity More automation
Less human friction
More transparency

21. Build a Culture That Scales
• Hire people who can scale as you grow
• Hire consciously competent managers with
a track record of growth & learning
• Push decision making down
• Diversity breeds creativity

22. Find Your Own Path
• Focus on customers
• Don’t obsess over competition
• Don’t worry about categories
• Listen to the market

23. Know More Than Your Board
• Understand your market, customers
and competition
• Don’t worry about how things look;
focus on how things are
• Get input on strategy
• Own the decisions

24. What Else?
• Be positive
• Make a difference
• Perfect is the enemy of Good
• Most problems are people problems

25. Resources
• The Innovator’s Dilemma, Christensen
• HBR What Makes an Effective Executive, Drucker
• Art of the Start, Kawasaki
• Company, Barry

26. Questions?
Zack Urlocker
COO, Duo Security
ZUrlocker@duo.com
Twitter: @Zurlocker
www.rock-opera.com