Building Two Open-Source Startups in a Row: Sysdig CEO Loris Degioanni (Part 5)

Loris Degioanni: These dynamics towards micro-services means that these companies can essentially break their software into smaller pieces and then use APIs to talk to each other. This spawned a massive industry that is led by the cloud vendors and by open source projects like Kubernetes.

I witnessed the creation of these industries and immediately thought, “We should focus on this. This is new and very different. Managing and observing a software that is split into a thousand little pieces is very different than monitoring a giant monolith.”

The focus became making sure that our products support this way of writing software. For the moment, very few people write software this way. In the short term, we are going after a small addressable market, but the market will grow. If it grows, we’ll grow with it. We will be well-suited tools for the market. These were the very early days for Sysdig.

This time, since I had some connections, I raised venture capital from the get-go. I partnered with a couple of venture capital firms – Bain Capital and Excel. I was learning again. I had never raised money. I had to learn on the job. Sysdig, thanks to the fact that we managed to raise money, grew and is growing at a much faster rate than my first company.

In particular, I sold CACE when we were at 30 people. Sysdig has now crossed the 200 employee mark. It’s a bigger organization. It’s a more complex organization. It’s also an organization that keeps growing faster.

Sramana Mitra: Let’s talk a little bit about how you built this venture. When did you start this company?

Loris Degioanni: It was started in 2013. 

Sramana Mitra: At what point did you raise money?

Loris Degioanni: I raised money early on. I incorporated the company in the first half of 2013. I managed to raise money in the second half. We managed to raise our seed round within six months after starting the company.

Sramana Mitra: How much did you raise?

Loris Degioanni: The seed round was $2.4 million. 

Sramana Mitra: What did you achieve with it?

Loris Degioanni: It was used mostly to start hiring people. Before raising money, the company was myself. I had a person that had joined me. He started working full-time only after we raised money. Before raising money, the company was me.

Those were super fun times when I was dividing my days between writing code and being the person working on marketing and investor relationships. We tried to raise our seed round by going to friends and family. Then, we extended this to institutional investors when I detected that there was interest from institutional investors.

It was all completely me. As soon as I raised capital, I went out and hired a bunch of engineers, mostly coming from my previous connections. Those were the people that joined Sysdig early on and worked with me on the initial version.

This segment is part 5 in the series : Building Two Open-Source Startups in a Row: Sysdig CEO Loris Degioanni
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