Startup to IPO: An Entrepreneur’s Reflections

This last week I’ve been thinking about what the IPO milestone means to me as an entrepreneur.

Those already familiar with the story are aware that when I started TriNet in 1988, my vision was not to grow a big company.

Like most first time entrepreneurs (especially pre-dotcom), I was only seeking to be an independent businessman who could move away from the big company world to gain a bit more control over my destiny.

Driving the business concept were the same motivators that powered me through college and the workplace as a Human Resources Manager for 11 years before starting TriNet: figuring out how I could have an impact on quality of life in a work place.

In retrospect, that lens provided a framework for the classic entrepreneurial motivator of knowing enough about a particular problem that led me to envision a path for business opportunity few others could see at that time – a means to bring quality HR to the small business workplace.

Other starting goals included the idea of creating something that might last a long time. Maybe even survive me.

This meant not just a successful business, but a team committed to the HR impact and longevity vision who would also find fun, satisfaction and reward by working together.

Not knowing much about business models back then, we were still in the early struggles for survival when awareness began sinking in about how the very nature of what TriNet does was eventually going to put us on a collision course with future competitors who I realized would be large corporates, rather than the startups in our space – many of whom were growing much faster than us.

These big companies (e.g. ADP) already had massive scale advantage, but at that time were oblivious to the opportunity TriNet’s then very different operating model presented.

So while still clawing for early revenue, we shifted our entire focus towards a strategy of building growth by becoming best in class for a narrowly defined vertical market (VC backed tech companies) and simultaneously began the journey of securing equity capital.

This was an inflection point as I jettisoned the original “grow a successful small business” plan in favor of a sprint to build scale.

Taking on Equity Investors Changed Everything

Our first angel round was in June 1990 and we raised a total of $50,000. By today’s standards not much at all, but for where we were then, this was the difference between success or going into the trash heap.

It wasn’t just the cash infusion, but with that decision to take on shareholders came the defining commitment to find a way to deliver meaningful return for the trust investors placed in me by investing. Five subsequent rounds of equity financing further upped that ante.

Right along side that was the same commitment to bring liquidity to team members who were taking below market salaries in exchange for then worthless stock options in our cash bleeding startup.

Both of these commitments could only be fulfilled with growth. Ever increasing, high volume growth. At a pace that challenges every aspect of building a company. And resulting pressures that create stress at every level on the team.

An Entrepreneurs’ Reward

In crossing the IPO finish line 26 years from the starting gun, I can’t help but feel that it has been a long, difficult and yet fun journey. And with today’s high bar to just execute a successful IPO, the milestone itself does bring some satisfaction of accomplishing something well understood to be difficult.

Repaying investors and team members for the risks they took when TriNet’s future was so less certain is indeed something that means a lot to me as founder. The size of the equity rewards made that long wait worthwhile for all.

Yet the more meaningful reward for me is realizing that my original founding principles are still intact even though I stepped down as CEO almost six years ago.

As the next generation of leadership has so capably demonstrated, TriNet is:

  • touching lives with meaningful impact well beyond the nearly quarter million work site employees we service today;
  • a company where our team works hard, is highly committed to the mission and still finds ways for the journey to be fun and fulfilling; and
  • is poised to keep growing amidst many challenges, adapting to changing market conditions with the clear intent to be around a long time.

These are things that I dreamed about as a rookie entrepreneur. So while our scale is far different than originally envisioned, my greater reward for the IPO is seeing how far we’re advancing towards that goal of creating a lasting institution that embodies these founding principles.

For Entrepreneurs, our Canvas is the Business

In the arts, most people understand the intrinsic satisfaction that can come from starting with nothing more than an idea to create a painting, song, movie etc. that has appeal to a broad audience. Having that appeal last for more than a generation is even harder.

Less talked about is the application of that principle to creating a business. Starting and nurturing a company for 25+ years, including through a transition to new leadership, is a comparable creative challenge.  Especially when the business is creating a new category and in our case, having to balance fiduciary responsibilities in representing the interests of all shareholders – not just a founder’s vision or desires.

So yes, I’m a very lucky guy to have gotten this far in realizing my entrepreneurial ambition. Knowing it happened because of my good fortune in finding the right people who believed what was possible and worked so hard together to turn dreams into reality.

With so much running room yet to go, evolving to show staying power as an enduring company is even harder than executing an IPO – keeping an entire team invigorated for the challenges ahead.

8 Responses to “Startup to IPO: An Entrepreneur’s Reflections”

  1. I appreciate the many congratulatory notes received over the last week. Support from so many team members, partners and friends over the years is what made building TriNet possible.

    In writing this Reflections post, my hope would also be to encourage comments from team members (past and present) who have specific recollections of their own from the journey as well as entrepreneurs and others working with startup teams who are thinking about their own long term vision.

    Your recollections and/or observations about a company’s ambition for the longer term are rich topics for dialogue – far more interesting than my own musings about the past.

  2. Your comments inspire. The money is nice, but the accomplishment of making a difference is greater. Our goal was to help families that could not get a fair shake. We now create the same private client experience for the masses inside the retirement space. The money is good, working for the greater good is better.

  3. Great post Martin and congrats to you and your team again on all of your hard work on this incredible journey!!!

  4. It was great meeting you at the EO event, your story inspired me, reading your blogs are inspirational as well. Thank you for sharing and congratulations to you and your team on this amazing journey!

  5. Congratulation Martin! I appreciate your journey. I have pleased to read the entirety of the post as mentioned above in detail. I am late but still, I am finding some inspiration through your posting. Thanks and keep posting more!


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