When do you know you’ve got a vertical market to pursue?

Answered by: Tien Tzou, CEO, Zuora

Category: Product Development

To frame it a little differently, I think you try to find as you build a startup is what is the learning that's different than what people conventionally teach you. For example, in business school and in big companies, the way a decision is made is you think about how do we make this better. Then, someone does the analysis and you put together a proposal. It's still a gamble at that point but you're taking the best guess as you can. You're going to deploy infrastructure and employ people and you want a structured way of thinking about things. As a startup, you don't have that luxury. You say I think the auto industry is going to work or newspapers which is a better example because we saw it early in 2011. We were in board meetings and talking about something going on with newspapers. Our board was pushing back saying, "Are you kidding?

The newspaper industry is going to die. Are you sure?" And then for our whole media sector that we announced in the earnings call came to about 13 percent of our revenues. So it's not an insignificant call. It's a healthy board discussion. And so the question becomes, how do you bootstrap these decisions?