Long Journey to a $435M Exit: Bytemobile Cofounders Chris Koopmans and Nicholas Stavrakos (Part 5)

Sramana: The tricky part of the journey you have been describing is that you had venture investors. They want to see growth, revenues and a potential exit. There is a lot of pressure on entrepreneurs when the market does not evolve as expected. That is why I find it interesting that you were able to find pain points with the major carriers and that you were able to deliver products that addressed those pain points while you waited for the market to develop.

Chris Koopmans: I would be remiss if I did not mention how good our investors were. Benchmark Capital led our Series A and Trident Capital led our Series B. We had great investors who could see the vision with us and could see that the market was developing.

Sramana: That is a very important piece to preserve. Having investors who believe in the long-term vision provides staying power.

Chris Koopmans: The investors were great and helpful in believing the vision, but if we had to go look for new money every year it would not have worked. We were generating revenue and we were paying our own way. We were cash flow positive.

Nicholas Stavrakos: One of the reasons our growth took a bit longer was because we depended on a lot of different things to happen in the marketplace. Any time you have a solution that is dependent on others, your destiny is held in someone else’s hands. Networks were slow and devices were clumsy. It was a confluence of events among faster devices, better networks, and rich content like YouTube which caused the explosion on wireless networks. It is much easier to solve a point problem once it exists. It is harder to realize the mobile Internet gateway vision we had without all of this. Our platform has not become bigger than just an optimization piece. In order to become significant, the traffic levels have to be there.

Chris Koopmans: I also think that if you waited until that trifecta was realized to get involved, you would have been too late. Companies big and small did try to get involved between 2008 and 2011. The reality is that it is very hard to convince big telecommunications companies to put your product into their network, especially since it is now a critical service. When telecoms had 50,000 modem subscribers they would take a chance, but now that their main business, growth and plans are around data they look at Bytemobile as a company with a decade of experience. We had earned their trust.

Sramana: You were perfectly positioned when the market did become available because you had been around. You had earned your reputation in the space.

Chris Koopmans: Those new startups don’t know what they don’t know. They might know how to do video optimization, but that does not mean that understand the other 50 products that they need to integrate with to operate in that space. Yes, we were early to market, but at the same time, you need to look for a future problem. It takes time to build expertise and trust.

Sramana: That is a tricky game. Surviving over a long period if you are VC-backed is very tricky. In your case you have navigated very well. It is an extremely tricky game and you are throwing around terms like company acquisitions, but those are tricky things to do.

Chris Koopmans: Certainly. If you could look back in time you could optimize timing all the way around. Nothing ever worked that way for us. The key thing is that you can’t game the system. You can’t see the future. The reality is that you need to build a good team of people. You need smart people who are dedicated to building a company, and you will find the right path. We had the team of people [who wanted ]to be successful, and as long as you have that then you have the basics to be successful.

This segment is part 5 in the series : Long Journey to a $435M Exit: Bytemobile Cofounders Chris Koopmans and Nicholas Stavrakos
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