Ryan Smith has purchased a majority stake in the Utah Jazz, valuing the team at $1.6 billion.
The part you didn't know?
His family bootstrapped their business from their basement to an $8 billion acquisition, turning down $500M cash in the process.
Time for a thread 👇👇👇
The part you didn't know?
His family bootstrapped their business from their basement to an $8 billion acquisition, turning down $500M cash in the process.
Time for a thread 👇👇👇
1) Let's start in 2002 — Ryan Smith, a student at BYU, gets call from his father, Scott, while working an internship for Hewlett Packard in Los Angeles.
“I’ve got cancer, and it doesn’t look good.”
With doctors giving his dad six months to live, Ryan headed home immediately.
“I’ve got cancer, and it doesn’t look good.”
With doctors giving his dad six months to live, Ryan headed home immediately.
2) After quitting his internship, Ryan Smith arrived back in Utah with no real plan.
"I just wanted to sit and be with my dad, but he had a lot of downtime between radiation and chemo."
How'd they fill the downtime?
"We started working on this idea that became Qualtrics.”
"I just wanted to sit and be with my dad, but he had a lot of downtime between radiation and chemo."
How'd they fill the downtime?
"We started working on this idea that became Qualtrics.”
3) Ryan's dad, a researcher by nature, realized companies had no effective way to survey, conduct market research, and communicate with customers and employees.
The solution?
Qualtrics — an online software platform that allowed companies to survey and communicate effectively.
The solution?
Qualtrics — an online software platform that allowed companies to survey and communicate effectively.
4) Within a couple months Ryan and his father had a product ready to go.
The only problem? They needed customers.
Given his fathers background, they started with colleges that conducted field research.
First up — Kellogg School of Management, who took a year to onboard.
The only problem? They needed customers.
Given his fathers background, they started with colleges that conducted field research.
First up — Kellogg School of Management, who took a year to onboard.
5) Fast forward a few years and Qualtrics had 250 universities across the country signed up.
The best part?
As students graduated, their penetration into universities worked as a feeder system into corporations.
"Someone took us from Kellogg to Heineken."
Sales accelerated.
The best part?
As students graduated, their penetration into universities worked as a feeder system into corporations.
"Someone took us from Kellogg to Heineken."
Sales accelerated.
6) As the company grew, Ryan convinced his brother Jared to leave Google and run the technical team at Qualtrics — "which increased productivity 7x."
That wasn't even his biggest contribution.
Despite being pitched 50x a month, Jared was adamant they didn't take venture capital
That wasn't even his biggest contribution.
Despite being pitched 50x a month, Jared was adamant they didn't take venture capital
7) In 2012, now doing around $50M in annual revenue, the Smith family got an offer that was tough to refuse.
A "legendary Silicon Valley VC" offered the Smith family $500M cash to buy the company.
Believing it could be a multi-billion dollar business, they declined.
A "legendary Silicon Valley VC" offered the Smith family $500M cash to buy the company.
Believing it could be a multi-billion dollar business, they declined.
8) Shortly after turning down $500M, now 10-yrs into the business, Ryan and Jared finally agreed to take outside funding.
"We started to see investors as more than just deep pockets."
The two accepted a $70M Series A investment from Accel Partners and Sequoia Capital.
"We started to see investors as more than just deep pockets."
The two accepted a $70M Series A investment from Accel Partners and Sequoia Capital.
9) From 2013 to 2018, Qualtrics kept growing — going from 5,000 customers to 8,000.
With growth north of 50%, the business cash-flow positive, and almost $1B in annual revenue — Ryan & Jared decided it was time to go public.
But SAP had other ideas…
With growth north of 50%, the business cash-flow positive, and almost $1B in annual revenue — Ryan & Jared decided it was time to go public.
But SAP had other ideas…
10) Knowing the Qualtrics IPO would be oversubscribed, SAP tried to stop them from going public.
Ryan Smith declined, insisting the road show would go on and gave SAP 7 days to make them an offer they couldn't refuse.
SAP came back with $8B.
This time, the brothers accepted.
Ryan Smith declined, insisting the road show would go on and gave SAP 7 days to make them an offer they couldn't refuse.
SAP came back with $8B.
This time, the brothers accepted.
11) Despite becoming a billionaire through SAP's $8 billion cash acquisition, Ryan Smith has remained CEO of Qualtrics.
When asked why he feels the need to continue working, Smith references a work ethic he would like to pass down to his kids:
"My kids need to see me grind.”
When asked why he feels the need to continue working, Smith references a work ethic he would like to pass down to his kids:
"My kids need to see me grind.”
12) After having success in business, Ryan Smith is now able to fulfill a childhood dream of his.
“I dreamed of playing for the Jazz and that didn’t work out.”
Instead, he'll own the team — purchasing a majority stake in the franchise at a $1.6 billion valuation.
“I dreamed of playing for the Jazz and that didn’t work out.”
Instead, he'll own the team — purchasing a majority stake in the franchise at a $1.6 billion valuation.
13) In the end, there are plenty of ways to build a business — the Smith's did it their way and built an $8 billion giant.
Ryan's best advice?
"Trust your gut, learn to be scrappy, tune out the noise, and play the long game."
BTW, Ryan's dad is now cancer-free :)
Ryan's best advice?
"Trust your gut, learn to be scrappy, tune out the noise, and play the long game."
BTW, Ryan's dad is now cancer-free :)
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