Which Metrics Truly Govern a Business

Alex Clayton is one of the clearest minds in growth-stage investing, the person elite founders turn to when the market is noisy and the stakes are high. A General Partner at Meritech Capital, Alex has built a reputation for breaking down complex businesses with uncommon clarity, from his legendary S-1 teardowns to his frameworks on power laws, secondaries, and AI-native growth. Before Meritech, he honed his craft at Spark Capital and Redpoint, backing breakout companies like Braze, JFrog, Outreach, Pendo, Duo Security, and RelateIQ. A former ATP tennis pro and Stanford team captain, Alex brings that same discipline, pattern recognition, and competitive fire to evaluating the next generational companies.

Discussed in this episode

• Why GAAP revenue and cash burn are the two metrics that quietly govern everything.
• How AI is changing growth rates, margins, and what “good” looks like in SaaS.
• The rise of secondaries, and why they now rival or exceed IPO volume.
• How to read an S-1 like a pro (and what Alex looks for first).
• Founder ownership, fund lifecycles, and how long companies really stay private.
• Why power laws in venture are getting even steeper in the AI era.
• How AI is reshaping pricing models from seats to usage and outcomes.
• Which iconic private companies are most likely to go public in the next 3 years.

Episode highlights

02:40 — Is the IPO window really back? 

05:10 — Secondaries quietly outpacing IPOs

08:10 — The only two metrics that matter

10:56 — AI growth that breaks SaaS mental models

26:20 — From “software” to “SaaS” to “AI”… and back again

29:25 — Seat-based pricing vs outcome-based AI pricing

34:55 — The capital tidal wave & longer private lives

44:00 — Bubble vs biggest opportunity of our careers

57:17 — What the rest of the 2020s look like

1:03:41 — Why GAAP revenue + cash burn still win

Brought to you by: AngelList

How did we build the GTMfund back office? Easy!

We leveraged AngelList’s Rolling Fund product for Fund I, which was the perfect vehicle to scale up GTMfund in its first iteration. This structure allowed us to build our network, and add revenue leaders while we raised and deployed capital simultaneously, which was crucial for getting early points on the board and building relationships with founders.

For Fund II, we transitioned to a traditional closed-end fund structure through AngelList. This time with institutional investor support. This model allowed us to be more intentional about our portfolio construction. We worked closely with the AngelList team throughout this process, and they were incredible — always there to support us and our LPs every step of the way.

If you’re raising a fund or are looking to migrate your fund, we highly recommend you check them out. You can do so at www.angellist.com/gtmfund.

Follow Alex Clayton

• LinkedIn: https://www.linkedin.com/in/aclayton
• X (Twitter): https://x.com/afc

Follow Max Altschuler (Host)

• LinkedIn: https://www.linkedin.com/in/maxaltschuler/

The GTMnow Podcast
The GTMnow Podcast is a weekly podcast featuring interviews with the top 1% GTM executives, VCs, and founders. Conversations reveal the unshared details behind how they have grown companies, and the go-to-market strategies responsible for shaping that growth.

Visit gtmnow.com for more episodes and other interesting content.