First Principles Part 1: Aneesh Reddy of Capillary Tech on his wins, mistakes and a breakout SaaS model
Jan 25, 2024
Aneesh Reddy, the Co-founder and CEO of Capillary Technologies, shares his inspiring journey from corporate life to leading a global SaaS company specializing in customer loyalty. He discusses the ups and downs of building a tech giant, including strategic pivots and battling economic downturns. Aneesh provides insights into how they foster brand loyalty through focused solutions and the critical role of team dynamics in a startup's evolution. Hear about the challenges of retaining talent and the importance of company culture in navigating growth.
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Co-founder Conflict and Coaching
- Aneesh was shocked when co-founder KK said he was too stressful to work with and wanted to quit.
- A board member suggested Aneesh get a coach to help him manage the leadership challenge at age 28.
Bouncing Into SaaS Model
- Capillary did not start as a SaaS business but 'bounced' into SaaS during the 2008 recession due to customer demand for subscription pricing.
- They initially offered monthly charges instead of upfront server purchases, helping them survive the recession.
Rule of 40 Before IPO
- Listing as a public company is best done when growth plus free cash flow (rule of 40) exceeds 40% for stock stability.
- Capillary aims to reach 10% free cash flow before pursuing the IPO again.