Keeping it in Colorado: Rally Software Files for IPO
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Well this is exciting.
Every other day there’s a story about great things happening in the startup scene along the Front Range. Last week, the Obama for America Engineering Dream Team came to town and over the course of a few days reinvigorated the entire tech community. The week before that, Denver-based Beatport was acquired for what many sources say was at least $50 million.
And now this . . .
Rally Software has filed for an initial public offering of $70 million of its stock. (Full disclosure: I have an investment interest in Rally Software through a venture fund in which I am a limited partner.)
I first met Ryan Martens, Rally Software’s Founder and CTO, in 2001 when we were both Entrepreneurs in Residence at Mobius. Ryan was intelligent, focused and determined to find his next big thing. I was impressed.
Almost ten years later, I had the chance to hear Ryan and Tim Miller, Rally’s Chairman and CEO speak about Rally’s formation. Throughout the talk they continued to reference a set of six principles that live at the core of Rally's company culture. Tim was kind enough to share these with me, and I want to share them with you:
1. Create Your Own Reality
2. Make and Meet Commitments
3. Theory Based Decision Making
4. Give Back
5. Work Life Balance
6. Respect
Tim pointed out that he wasn’t suggesting they should be everyone’s values. If you’re starting a company, you want your guiding principles to be your core values. What I love about this story is this: Rally has managed to get where it wanted to go by sticking closely to its core values.
This focus, that I first observed in Ryan Martens (and later in Tim Miller) permeates the company.
It has been too long since we’ve seen a technology company complete a successful IPO in Colorado, particularly an IPO. Significantly, the $70 million amount Rally plans to raise in its IPO does not represent the full market capitalization of the company. If this goes through as planned, we should all celebrate the notion that Rally could be a Colorado fixture for many years to come. With revenues exceeding $40 million last year and a worldwide team of nearly 300 people (many of them here in Colorado), it would be wonderful to think that Rally could remain here in Colorado, remain independent and continue to maintain its growth and leadership in the agile and lean development marketplace.
Keeping Rally Software in Colorado would be great for Colorado. The company ranks eighth on FORTUNE’s list of the best medium-sized workplaces, and Ryan Martens, Rally’s Founder and CTO, is also a founder and the current CEO of EFCO, Entrepreneurs Foundation of Colorado.
The Entrepreneurs Foundation of Colorado (EFCO) is a network of Colorado entrepreneurs whose companies share a common commitment to pledge a portion of founding equity or a portion of annual profits to the community. By creating a culture of corporate philanthropy from an early stage, EFCO member companies instill the values of community support into their organizations and into the communities in which they reside.
It should come as no surprise that Rally Software is a proud member of EFCO. This means that Rally has pledged a portion of its founding equity or a portion of its annual profits to the community, which promises to be a very good thing for Colorado.
Rally’s commitments to giving back to the community and to sustainability have been a core part of Rally’s culture. (More full disclosure: my company, Vokl, has pledged a portion of its founding equity to EFCO.)
Incidentally, if you run a company in Colorado and you haven’t looked into EFCO, please do.
I mentioned sustainability. Rally Software is a certified BCorporation. As part of its mission, it is committed to sustainability. What does this mean? Rally makes this pretty clear:
1. Making Rally a Sustainable Company
The first goal is to get our waste per employee benchmarked and compared to other companies and industries. The second goal is to drive the waste per employee at Rally down on a curve toward zero, like Interface. Our third goal is to leverage the right technical advances to accelerate our declining waste all the while sharing our stories, tools and path with our customers and industry.
2. Making the IT Industry Sustainable
Our first goal is to get the SaaS model of building, distributing, and selling software benchmarked against the old enterprise model of shipping software. Our second external goal is to start driving the waste per user of the Rally service down on curve toward zero. Our belief is that a high-tech industry driven by service can become one of the first truly sustainable industries. As a result, we should be in the right position to grow the size of our industry, while helping to develop the innovations necessary for other industries and consumers to become sustainable.
I am incredibly inspired by what Rally and its team have accomplished to date, and I look forward to a future in which Rally continues to be a key part of the community.