By Henry Huang (Partner) and Jay Bartot (CTO) of Madrona Venture Labs
Our team at Madrona Venture Labs (MVL), working in close collaboration with Madrona Venture Group, focuses heavily on identifying big opportunities to solve complex business challenges with Intelligent, Data-driven Applications. UpLevel and Zeitworks are two exciting MVL startups that fit the bill, and Stratify, led by founder and CEO, Brian Camposano, is our latest. Stratify is revolutionizing enterprise financial software by intelligently joining multiple data sources with machine learning and deep domain expertise. At MVL, we share Madrona Venture Group’s mission to partner with founders from Day One. In addition to Brian, our collaboration with Steve Singh, Managing Director at Madrona, and former founder and CEO of Concur, began at the inception of the idea, even before Stratify was formed and incorporated. Steve’s own experiences with broken corporate finance processes laid the foundation of the vision of the company, and the technology and product solution that supports it.
Last week, Stratify announced that they raised a $4.9 million seed investment led by Madrona Venture Group with participation from Coatue, to transform financial planning and analysis (FP&A) by connecting operational data siloed within systems of record (i.e., Customer Relationship Management Software, Human Resource Information Systems, Accounts Payable Automation Systems, etc.), applying ML to identify performance gaps, quantify future financial impacts, and automatically create revised forecast scenarios. Corporate finance processes that once took weeks if not months to execute, can now be done automatically and continuously.
In early stage investing, the backgrounds and relevant experiences of the founder(s) are key to ensuring early and long-term success for a startup. At MVL, we refer to this as “founder, idea fit,” and for us, it is one of the most important elements of an exciting investment opportunity. The importance of “founder, idea fit” is even more pronounced when building a company in a highly specialized, arcane field, such as corporate finance, where a compelling vision needs to come from deep experience with the domain. Brian Camposano, former CFO of Docker and former corporate finance executive at SAP and Concur, has lived the pains and constraints of existing FP&A software for nearly two decades. He is the customer.
Brian’s domain expertise combined with MVL’s technical, product, and operating expertise in the areas of data and ML formed the genesis of Stratify’s initial product and vision. This melding of skills and backgrounds was more critical than we could have imagined. When we met Brian for the first and only time in February, we recognized right away that he was the right founder for Stratify. What we didn’t know was that due to Covid19, we would be incubating a company together remotely. Everything from getting to know each other, concept validation with customers, product planning, design reviews, product development with our internal MVL and offshore teams, sales calls, recruiting, and investor conversations occurred entirely on Zoom and phone calls. We leaned heavily on our belief in Brian’s “founder, idea fit” and his understanding of the customer, and he had to trust our experiences as former founders and operators, in order to collectively build the best foundation for Stratify.
As we transition Stratify from incubation to a fully funded startup, there are milestones worth mentioning that are consistent across all MVL companies, and representative of our process and our commitment to founders, including: the development of the company’s first technology prototype, recruiting and hiring an experienced team of technologists, signing the first pilot customers, and securing the first institutional capital to fuel the company’s next phase. Stratify accomplished these milestones in five short months, in the midst of a pandemic!
As we reflect on the most important aspects that made Stratify possible, a few key elements stand out. First, our learnings from incubating many intelligent business applications such as UpLevel and Zeitworks helped us to quickly identify data and ML challenges, and risks, allowing us to fast track the right solutions and resources. Second, strong “founder, idea fit” enabled our team to hone in on customer pain points expeditiously, narrow the scope of our MVP, and achieve a highly executable product roadmap with immediate benefits to customers (e.g. product market fit or “PMF”). Third, our team of experienced founders and operators, including Jason Flateboe, Ishani Gujral, Maria Hess, and Samuel Sunderaraj, was able to quickly adapt our processes to meet the new demands of remote working.
We’re thrilled to see Brian and the growing Stratify team take their next steps towards transforming the world of corporate finance. And, we would be excited to work with you to uncover new opportunities to build intelligent, data-driven applications for the enterprise. If you have an idea, let’s talk!