In a galaxy not so far away, and what feels like an eternity ago, we raised a Seed round for Sentry. While the landscape has changed quite significantly since then, it’s always interesting to reflect on past times.
At the beginning of 2015 I moved on from Dropbox. As most companies of it’s size it had become frustrating to someone like me - someone who aims to cut through the bullshit and just wanted to build. It certainly helped that by that point Sentry had become a full time job on its own, and two stress mongers are certainly worse than one. Fortunately that year my co-founder Chris and I had finally gotten Sentry to a point where it was generating a reasonable degree of revenue. We could pay ourselves a livable salary (albeit less than a new grad makes in 2022), and we even had enough cash to rope in our first hire - my friend Armin Ronacher - to start this endeavor.
The first few months were filled with dreams. We’d build this great lifestyle business. It’d be a business made of many various projects, all bootstrapped and profitable, all open source. We were going to build a company that we wanted to work at. Those thoughts quickly came grinding to a halt when we looked around at our opportunities. Several other companies in the space were already somewhat well-funded, well-staffed, and the reality was starting to set in that we had to choose what kind of future we actually wanted. So we threw that dream away and instead decided we would build something significant out of Sentry. We didn’t know what, but it’d be the biggest thing we were capable of building.
The first thing you do when building a business in these modern times is go raise venture capital - or at least that’s what we assumed. We hadn’t a clue about how this process worked, didn’t have a network of friends in VC, but we did have a couple handfuls of cold outreach investor emails to build upon. We figured that would make it easy - lots of people already showing interest. We’d just show up, explain the product and business, and they’d write us a check. Within a couple of weeks we had a full partner pitch at a now-unknown VC firm. I vividly remember during that process I was asked if we’d sell the company for $200 million. I said absolutely, in a heartbeat. We had $600k in revenue. They turned down our funding ask because we were not ambitious enough. In hindsight, their loss, and maybe that kind of thinking is why their fund never went anywhere.
Over the next couple of months Chris and I met with more than a dozen other partners. Every single one asked silly trivia - trying to find some kind of slip up or way for you to disqualify yourself. Mostly they just threw silly anecdotes at us with what only could be described as a lack of critical thinking:
- “No one will pay for Sentry”
- “Amazon will just run Sentry because its Open Source”
- “Developers don’t buy software”
And then they feign interest and ghost you.
The worst part of this was many of their criticisms didn’t make sense. We had 2,000 paying customers. We had proven there was a business behind it. What we hadn’t proven, nor had many other Seed stage companies: what large scale commercialization could look like. It truly felt like the success we had so far was working against us in these conversations.
To say the least this process is demoralizing, and if you’ve ever been through it, I empathize with you. We were on the cusp of just saying fuck it, and continuing to run the company bootstrapped. After all, we had made it this far, maybe we’d be able to compete with those VC-backed companies after all? It was around then that an old colleague from Dropbox reached out. They had joined Accel recently, knew of me, and were interested in what Sentry was doing. That led to Dan Levine and Accel leading our Seed round.
These days things look somewhat different. Developer-first businesses are no longer the scary anti-pattern. Open Source is treasured as a defensible model. Market share-based companies are the dream of many, albeit attainable only by the few. I’d like to believe that Sentry played a small part in opening up the ecosystem of developer tools, and enabling a collective of founders who want to solve the problems they’ve faced in their day-to-day.
Sometimes it just takes one person to believe in the vision, and finding that right person is often hard, but it only takes one.