(Contributed by Jason Cohen, Capital Factory Partner)
Marketo filed for IPO with impressive 80% year-over-year growth in 2012, with almost $60m in revenue. Except, they lost $35m. WTF?
It’s not impressive when you spend $1.60 for every $1.00 of revenue, force-feeding sales pipelines with an unprofitable product. Don’t tell me this is normal for growing enterprise SaaS companies. I know the argument: The pay-back period on sales, marketing, and up-start costs is long, but there’s a profitable result at the end of the tunnel. Just wait!