Tope Awotona had no intention of running his startup in the middle of a war zone.
It was February 2014. The Ukrainian capital was set on fire when anti-government protesters armed with Molotov cocktails fought against armed police. What began as a peaceful movement against President Viktor Yanukovych and his decision to forego a trade deal with the European Union had turned into a bloody state of emergency that would claim the lives of dozen in just a few days.
Most of them packed their bags and flew out of town. But Awotona's mind wavered from determined to desperate. He had done something dangerous and unusual even in the world of venture capital. The now 39-year-old had put every penny in his own wallet and more into his startup idea, quit a permanent job in the sales department of the cloud service company Dell EMC, emptied his retirement, used credit cards to the maximum and taken expensive loans for money small business to start a business that has not yet had any income. And he wasn't a software engineer: he needed a business in Kiev to build the technology behind his planning software company called Calendly.
Luke Beard – Courtesy of Calendly
So he shook off several warnings from friends and family and flew to Kiev that month. He had been there twice for the same reason – although it was his first time international news media covered the increasing violence and the death toll.
"I was scared," he says, remembering the sounds of explosion and chaos creeping into the confined space of his hotel room in Kiev, a mile or two from the center of the riot, where protesters at one point set up a ring of fire police officers fend off. “But Calendly was my life. I felt like I had no choice. "
If Calendly was to be built by a company in Ukraine, Avotona was determined to see with her own eyes whether the country was stable enough for a partnership to last. So he kept his head down and only traveled between his hotel room and the company's offices to build the app with the Ukraine-based company. Shortly after he left the country, protesters stormed Yanukovych's palace.
"In retrospect, it was probably stupid for me to leave," says Awotona, recalling that five months later a Malaysian passenger flight was mistakenly shot down over eastern Ukraine.
But it was also that determination that helped fuel Calendly's remarkable rise. Founded in 2013 and largely foregoing risk money, Calendly has primarily focused on profitability. The company will have nearly $ 70 million in annual recurring revenue this year, more than twice what it was last year. Now there is no shortage of venture capital and growth capital investors. (Famous companies like Accel, Iconiq, and Sequoia are among the names that have courted the company, sources tell Fortune. The three companies declined to comment on the story.)
"I think everyone wants to invest," says Mercedes Bent, partner at Lightspeed Ventures. In 2020, some of Calendly's potential applicants, having raised just $ 550,000 since its inception since 2013 from investors like Atlanta Ventures, casually valued the company “far north” of $ 1 billion, Awotona says. While Calendly didn't get a deal valuing him above that number, "it's very much a unicorn." As this story goes public, sources report to Fortune that the company has had talks valued at approximately $ 3 billion that would provide liquidity to existing shareholders.
While around 240 companies are unicorns in the US, according to CBInsights, one number would make Awotona a rarity on another front in that neighborhood: Compass, a real estate agent valued at $ 6.4 billion most recently, and Zume, a manufacturer Compostable Packaging, worth roughly $ 2 billion prior to the pandemic outbreak, is among the only others that black founders have.
It's not a status Awotona would have been familiar with in his early days when it was difficult to get a meeting with an investor. While in Kiev, a potential North Carolina investor was laid off for a scheduled video call at 2 a.m.
It was fate that the North Carolina investor failed to keep his appointment. Planning is Calendly's business, after all. Taking advantage of the irritation of making an appointment to visit the stylist or meet a school teacher, the company has attracted around 5 million active users a month, including users on Linkedin and Zendesk, who may use the tool to schedule a sales call or interview a new hire. While a single meeting can carry multiple emails back and forth, Calendly only shows a user's available time slots without the need for lengthy email exchanges. Ideally, a time can be agreed with one click. Boom: The slot is also blocked in Google Calendar and Outlook.
Awotona was by no means the first person to come up with the idea of software planning – this is one of the reasons why investors stayed away from the company in the early days. But Calendly started because it was designed like a consumer product, inspired by Awotona's frustrations trying to schedule a demo call with customers at various technology companies, including Dell EMC. And it had a natural potential for virality: Calendly's most basic tier is free. But to take advantage of it, consumers must share their Calendly branded calendar with friends. And if those friends like the product, they'll sign up and maybe even pay to have their companies use it too. This type of word of mouth helped keep the company's marketing costs down.
“The planning tools were a bunch of bells and whistles at the time, but Calendly provided an Instagram-like experience for a business tool,” said Blake Bartlett, partner at Openview Venture Partners, who invested in 2017. “And it was viral. ”
Awotona now attributes this early lack of cash as a major benefit to its business model. The basic version of Calendly is in fact completely free – but that's partly because Awotona didn't have the money to build a payment rail for the project at the beginning. The lack of cash "forced me to double up," says Awotona, dressed in a black but cheerful calendly shirt from his home office overlooking the green Atlanta BeltLine, an African mask purchased by Room and Board and hangs on the wall above his desk while a much more real Ghanan shrine figure from the early 20th century sits quietly on a sideboard. An evergreen plant – an idea his fiancé also introduced by a Calendly customer – peeks out of the white planter from the edges of our zoom call.
A different kind of founder
In a way, Awotona fits in with the epitome of the founder form: yes, he spent an inordinate amount of time designing and choosing shirts with his company's logo on it. Yes, he meditates. He's also a former Whiz boy who graduated from high school two years early and was admitted to a US university at the tender age of 15. He would have left too, had his mother not worried about his ability to adapt to such a rapid situation, pushing him to take on two more years of high school. And like many founders, his early professional start was bred in technology companies: first at IBM, then in various sales functions at Perceptive Software, Vertafore, then at Dell EMC. And on the last tick of the founder's bingo board: He built startups before Calendly – although the ones he admits were less than groundbreaking. His first foray into a dating website after reading that the founder of Plenty of Fish made $ 10 million a year working 10 hours a week on a piece of the New York Times. Another, called ProjectorSpot, sold projectors while another, YardSteals, was a home and garden equipment platform.
But the parallels deviate wildly from there. First, he's not in Silicon Valley – his company is in Atlanta, Georgia. And Awotona lived his early years as the second youngest of a family of seven in a lower-class neighborhood in Lagos, Nigeria. When he was 12 years old, a group of men followed Awotona's father home and requested access to his car. His father threw them the keys. They shot him anyway and Awotona saw the whole thing. Although he didn't know it at the time, the incident left him with post-traumatic stress disorder. The insomnia continues to this day.
When asked if his skin color contributed to his early struggles to raise venture capital, Awotona is deliberate with his words and doesn't make it easy. He was never specifically denied funding because of his skin color, nor does he recall disguised slurs – and trying to raise funds for a company with $ 200,000 in revenue is never easy, especially in the Southeast. But how deeply ingrained prejudices could secretly infiltrate an investor, neither he nor any technology currently on the market can quantify.
There were other difficult moments in starting the company too: in late 2014, Calendly decided to add a premium version – a decision that app store users cursed, even if they stayed around at some point. Around the same time, his first chief technology officer unexpectedly resigned during a disagreement over strategy. "Those were the moments when I felt like the whole thing was falling apart," he says. Funnily enough, six years later, he can't remember exactly what the disagreement was about. “In a way, they become more resilient to setbacks. The things that seemed so scary at the time now seem silly. "
Certainly the Awotona would have been ill-equipped to scale Calendly back then. The company has recently seen a number of exits as it scaled up. For the first time, positions such as chief financial officer and chief marketing officer were added while others had different ambitions or were closer to their home than Atlanta. Oji Udezue, his vice president of product, is based in Austin and left earlier this year out of a desire to find a job near his home. Chief Financial Officer David Rostan left the company to start his own business in New York, his home base. Former head of the company, Brent Chudoba, had ambitions to run a company as CEO and moved to Biteable. The three declined to comment on the article.
The pressure doesn't stop there: other companies have also recognized the benefits of Calendly's planning model. Square, which is marketed to small businesses, now also offers planning tools not dissimilar to Calendly's. Amsterdam-based company Doodle has also recently gained momentum. To stay ahead, Awotona strives to make Calendly more intuitive for its users by using data to determine, for example, which potential customers to prioritize for a sale or to automatically one day find the best times for those involved Propose parties. And the question that everyone inevitably asks is: will Microsoft or Google jump into the fight?
A possible exit
Viewers can also draw comparisons between Awotona's business and that of Mailchimp, another Atlanta-based company that has been fully promoted to unicorn status.
In fact, the heads of the two companies know each other and meet occasionally for coffee before the pandemic after they teamed up in an Inc magazine segment on startup mentoring (Ben Chestnut, CEO of Mailchimp, describes Awotona as "thoughtful and thoughtful" calmer Guy, humble and a little mysterious – I don't think on purpose. He reminds me of me. ”).
Mailchimp can theoretically stay private forever – the CEO didn't take any outside money and made a profit-sharing agreement with employees on stock-based compensation, but Awotona did give employees shares. This means that he will eventually have to accept more outside investors, although he hopes this is not a change of control.
“(Going public) is certainly a strong option to consider. Keep in mind, however, that private markets are really very robust these days, so some investors really just want to take part in the liquidity event. This allows employees to sell their shares, but as the majority shareholder I don't have to sell my stake in such a transaction, ”he says. "I'm focused on making Calendly a massive stand-alone company."
What keeps him going nowadays?
"At first it was for financial reasons – I literally had to pay my bills," he says. “But the motivations have shifted over time. As Calendly has grown, I just get a ton of out-of-shape folks that appeal to me, women, men, people of color – so inspired by history – keeping me through tough days . "
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