Lane

here for cool news and insight. memes too. growth @metrics_co

[Lane @LaneAltbaum]

@mspringut So sick

[Lane @LaneAltbaum]

@mobileraj Haven't heard the concept of a negative roadmap before, but I like it

[Doug Dyer @TheFundCFO]

Most Rule of 40 discussions focus on public SaaS companies.

@metrics_co instead analyzed 1,377 venture-backed private companies, and the results were interesting:
• Only 27.9% cleared Rule of 40
• Nearly 90% got there through growth
• AI companies continue operating differently
• Operating profiles change significantly over time

Full summary in today’s newsletter.
https://t.co/IUcgL7Hrzv

#VC #VentureCapital #RuleOf40 #SaaS

[Lane @LaneAltbaum]

@Carles_Reina @ElevenLabs Do you have an in-house brand designer, or did you consult with someone? Big fan.

[Lane @LaneAltbaum]

@jmelaskyriazi @ryanshmeizer @sparkcapital So good!

[Byron Deeter @bdeeter]

Great stuff - I always love more data and thought pieces around business building!

I love rule of 40 as a quick test, but still stand by the Rule of X as the superior metric to build and manage your growth business. Growth is more valuable than FCF early on, and managing your business differently will lead to sub optimal decisions! @BessemerVP

https://t.co/vPbDHwbweS

[SFGATE @SFGate]

SF landmark Julius' Castle to reopen after nearly 20-year closure https://t.co/Ie2ss32Jmm

[John Melas-Kyriazi @jmelaskyriazi]

Excited to announce the launch of Standard Metrics’ latest Private Market Report. We dive into one major question: how do private companies fare under the Rule of 40?

@bfeld popularized the rule in 2015. @BatteryVentures built a framework on top of it in 2019. @BessemerVP argued for an adjustment to it, prioritizing growth over margin in 2024. All of these prior analyses, however, were built on public data or small private portfolios. This is the largest private-market test of this framework we've seen to-date.

We cover:

- Why 89% of private companies that clear R40 do it through growth alone (vs. balanced performance)
- How AI companies distribute across four different zones of growth and profitability, and why Zone 3 (high growth, low margins) is the zone to watch
- The interesting cohort dynamics and surprising results around churn and stickiness amongst companies in various other zones of growth and profitability

The depth of analysis in this report is something we've been building toward since we started @metrics_co. @kochiko2001 is a large part of why we've been able to get there today. Huge shoutout to Ani and team for their work on this.

Ani and I chat through the history of the rule in the video below, and full report is linked here. Give it a read and let me know what you think. https://t.co/dObPiagd22

[Lane @LaneAltbaum]

@jmelaskyriazi @bfeld @BatteryVentures @BessemerVP Now investors have a baseline for what percentage of companies pass the Rule of 40 :)

[Lane @LaneAltbaum]

You're either a Lyft bike guy or unquestioningly loyal customers of Spin or Bird, depending on which app you downloaded first

[Lane @LaneAltbaum]

@jmelaskyriazi So pumped to bring this dataset into our AI Analyst

[John Melas-Kyriazi @jmelaskyriazi]

We’re very excited to announce the launch of private market benchmarks in our AI Analyst at Standard Metrics!

With a simple prompt, investors can now easily compare the performance of their portfolio against an aggregated and anonymized data set of over 10,000 startups.

Now investors can:

- Compare how a portfolio company is doing next to peers inside their firm and out, on metrics like growth, gross margin, runway, burn, headcount, and more
- Segment benchmarks to certain industries or revenue bands for like-to-like comparisons

This is a big one, and I’m proud of the team who brought it to life: @jehan_boer, @AndrewCounterr, @max_muoto, and so many more.

For any customers interested in using this, please get in touch with your @metrics_co CSM or shoot me a note.

[John Melas-Kyriazi @jmelaskyriazi]

Huge congratulations to my friends, collaborators, and @metrics_co founding investors at @8vc.

They've built a special firm, and now they have $1.5B in fresh capital. 👏

Proud to build alongside @JTLonsdale and his team.

[Parallel Web Systems @p0]

Standard Metrics (@metrics_co) is an AI-driven portfolio platform for venture and private equity investors.

Their latest feature is web search for their AI Analyst powered by Parallel. Now, their agent can pull accurate, consistent, real-time public data alongside internal documents and data for a complete picture of their investments.

[Lane @LaneAltbaum]

@a16z @elonmusk @SpaceX Beautiful video.

[Lane @LaneAltbaum]

@Trace_Cohen @_JoshSchafer Thanks trace 🫡 been curious about this

[Lane @LaneAltbaum]

@Noah2P @FujifilmX_US How is it compared to Yosemite?

[Lane @LaneAltbaum]

@darylginn I thought it wasn't rendering correctly the first time i saw it

[John Melas-Kyriazi @jmelaskyriazi]

More investors are running portfolio analysis from a chat window. So we're trying something: five prompt templates, pre-loaded in @claudeai for firms with Standard Metrics (@metrics_co) MCP connected.

Give it a few inputs like company or fund name; the prompt does the rest:
- Waterfall analysis: model exit scenarios across your portfolio
- Tear sheet: one-page PDF, same layout for every company
- Board prep: position, performance, what's changed, questions to ask
- Valuation: low/base/high fair value estimate using your methodology
- Benchmarking: analyze top companies based on certain variables

This is a first cut. If you're connected, they're live now. Try one and tell us what works and what you'd change!

[Lane @LaneAltbaum]

@brianovak Beautiful. Didn't know this until recently.