As a venture investor in one of the world’s most active early stage investment companies, Arjun Dev Arora has lived and breathed tech and startups for more than a decade.
After a short stint as an investment banker, Arjun joined the Yahoo real estate and development team in 2009. Two years later, recognizing the potential ad retargeting held for small- and medium-sized businesses, he founded ReTargeter, which by 2013 had landed on the Inc. 5000 list of fastest growing companies. That same year Arjun sold the company to Sellpoints then co-founded Immediately, a mobile platform for sales professionals, even as he simultaneously made his own series of angel investments.
We recently spoke with Arjun about the lessons he learned as an entrepreneur, his emphasis on developing values-centered organizations and his advice for a new generation of founders seeking investment.
You were working at Yahoo when you came up with the idea for ReTargeter. What prompted the concept and what was your thought process in deciding to leave Yahoo to pursue it?
As the Head of Business Development for Yahoo Real Estate, I’d had a lot of exposure to online ads in general. At the time, the concept of retargeting — that is, targeting ads to consumers based on their previous online behavior — had been around a few years, but it was really limited to large, Fortune 100 companies. I saw an opportunity to democratize the technology and build a business focused on the small-to-mid-sized business community.
I worked on ReTargeter on nights and weekends while at Yahoo, just getting it started. Then I took a calculated risk and left my full-time job to pursue the business. In retrospect, it would have made sense to leave earlier — I think the sooner you can spend 100% of your time on your business, the better.
Inc. Magazine recognized ReTargeter as one of the fastest-growing private companies of 2013. How fast did you grow and did you manage through that time?
When we started in 2009, it was just me and a couple of interns. By 2011 we had 15 people. And by the end of 2013, we had jumped to nearly 50. At first we weren’t deliberate about setting company culture. But by the time we hired our sixth and seventh employees, we realized that we needed to be more intentional about creating and sustaining a culture that was focused around our values — one that allowed us to focus on constantly improving.
So we laid out our values, and then we built our incentives around what was important to us. We walked each new employee through those values on their first day, and when we did our reviews, we circled back to those ideas.
You’ve been recognized by the White House and the U.N. for your success and commitment to that kind of values-centered organization. Why was it important to you?
People spend so much of their life in the workplace — our jobs can take up far more of time than our families or friends. As a founder you have a tremendous opportunity to create a healthy work environment for people — and also an obligation to ensure that your employees have a great, meaningful experience.
As a founder, a critical piece of this is establishing clear values for the company. Your employees need to know that the organization operates in a certain way. They need to understand what’s important and what’s expected of them, as well as what to expect from you, the employer. At ReTargeter, for example, we valued hustle, or your ability to work hard and get things done; adaptability, which is crucial for early stage companies; and long-term relationships. We didn’t want anything about our company to be a transactional experience for employees or customers.
What did you learn about growth marketing in your startup experience?
First things first, you need to get your story right from a positioning perspective. Spend time at the beginning talking to your advisors, investors and customers in the community. Make sure your message resonates. You don’t need to iterate forever — 10 to 15 of the right conversations should be enough to give you the information you need to get started.
Startups also have the luxury of experimenting with new channels. They’re often the first to jump on an emerging social media platform like Snapchat. Don’t be afraid to try to reach your market in different ways.
Can you discuss your leadership approach and what you believe is necessary for leading an effective team?
I think that having clarity in your vision as well as defined roles is key. You need to know what you’re doing, how you’re doing it and who is responsible for each objective. As a leader, I believe the old adage of always taking absolute responsibility and giving away all the credit. When things go wrong, the responsibility does come back to you. Conversely, you want to recognize the good work of your people when things go right. Finally, I’m also a fan of over-communication and simply relaying those values to staff as much as possible so that everyone understands them.
As a former Venture Partner with 500 Startups, you were focused on early-stage investing. What excited you during that time?
Between 500 Startups and my own investing, I’ve invested in or advised more than 100 companies. I saw a lot happening in financial tech right now, especially in lending and insurance. I was also excited about some of the startups in the B2B space, including HR software. In addition, the growth of the gig economy and the ability for more folks to work remotely affords all kinds of new opportunities. Finally, I was excited about augmented reality and audio as new ways to interact with computing.
Lastly, what advice do you have for founders looking for that first round of funding?
For me, one of the most important things is to ensure you are thoughtful about every share of equity on your cap table and that every investor is aligned with your values and your vision. Sometimes you have people who aren’t thoughtful or cautious about it in the right way. For instance, if you’re looking build a small, stable company, don’t bring in investors who want it to be a hyper-growth, venture-backed business.
One of the things I didn’t appreciate as a new founder as much as I do now is that you need to be conscientious about how you’re approaching and exiting your market. Finally, startups and businesses are a human exercise. Founders who spend time developing their EQ — emotional intelligence — skills can often figure out how to pitch and sell more effectively.
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