2022 Startup Exit Awards: Jim Eberlin completes a 'hat trick' in St. Louis' startup economy
Story By: Nathan Rubbelke - St. Louis Inno editor
Posted On: July 28, 2022, 01:30pm CDT
Original Article: www.bizjournals.com/jim-eberlin
Startup Exit Awards: Winner - Lifetime Achievement Award
As a teenager, inspired by the stories of some of America’s top technology entrepreneurs, Jim Eberlin began to be interested in launching companies of his own. He was motivated by the likes of Bill Gates of Microsoft, Apple’s Steve Jobs and Larry Ellison of Oracle Corp.
Decades later, Eberlin has created a story of his own that can inspire other nascent entrepreneurs.
In 2021, Eberlin completed a "hat trick" with the sale of his startup TopOPPS to San Jose-based software firm Xactly Corp. It marked the third time that a St. Louis-born technology startup founded by Eberlin reached a major exit. The other companies to reach exits include customer success firm Gainsight and Planful (formerly Host Analytics), which provides financial planning and analysis software. TopOPPS, which was founded in 2014 and has rebranded to Xactly Forecasting, provides sales pipeline management and forecasting software.
In addition to launching his own companies, Eberlin, 59, has been a champion of St. Louis’ startup economy. He’s worked with groups like Arch Grants and OPO Startups to help early stage companies, has personally mentored local entrepreneurs and invested in startups.
How did you begin your entrepreneurial career? I started a few tech companies and my first one that stuck was a consulting company. That gave me the idea and the financing to start my first product company, Host Analytics (now called Planful).
What do you consider to be the biggest achievements of your career? There were multiple highs that came along during my career. As an entrepreneur, the wins are more satisfying when you are the underdog, which is what I was most of my career. Some include:
At Host Analytics, beating Oracle to win Procter & Gamble as a customer with the help of my partners Sreedhar Peddineni and Ric Ratkowski.
Raising venture capital from top Silicon Valley firms such as Battery Ventures, Trident Capital and ATV.
Seeing all three companies successfully acquired.
Seeing your investors and key employees with successful outcomes as a result of acquisition.
Seeing key people in the companies become super successful.
Who have been the biggest mentors in your career? The people that gave me the most helpful and memorable advice on a regular basis are:
Brian Matthews, co-founder and general partner of St. Louis venture capital firm Cultivation Capital.
Cliff Holekamp, co-founder and general partner of Cultivation Capital.
Chris Cabrera, founder and CEO of Xactly.
John True, general partner at Cultivation Capital.
A lot of the Cultivation Capital partners.
Robert Brooks,CEO of Brooks Fiber before he sold it to Worldcom.
A number of very smart venture capitalists that were on the boards or advisory boards of all three of my companies.
How has St. Louis’ entrepreneurial economy changed since you launched your first company? Back in the early 2000s there were hardly any investments in St. Louis tech companies. Local investors and institutions from the Bay Area had little appetite for midwestern tech. As a result, I had to bootstrap Host Analytics from the sale of my consulting company, but had to drive sales to get us to break even within that runway. But in order to remain competitive for market leadership within that market, I had to raise funds. Our main competitor from the Bay Area raised $20 million.
After establishing a relationship with someone from JMP Securities in Silicon Valley, I received two term sheets from his introductions in early 2008 from top Silicon Valley venture capital firms, Trident Capital and ATV. In my next big venture, Gainsight (at the time called JBara) I received my Series A round from Battery Ventures in 2013. These venture capital firms were willing to invest in the vision of these companies and had the limited partnerships to rapidly grow the companies. St. Louis was not there yet at the time to provide this kind of support to tech startups.
It was about 2011 and 2012 that the current tech community and the funding scene was born in St. Louis. The unique and innovative funding from Arch Grants and Missouri Technology Corporation and the funding and mentoring of St. Louis’ first tech incubator, Capital innovators, sparked the beginning of a healthy tech startup community. Now what was needed within the community was a variety of funding for startups that could make it beyond initial product/market fit and into the growth stage. Brian Matthews, Cliff Holekamp and team started Cultivation Capital and Tom Hillman started Lewis & Clark Ventures which were the first authentic venture capital firms for this purpose. That’s when things really started rolling for the entrepreneurial community.
What’s been the biggest challenge during your career as an entrepreneur and how did you overcome it? There were so many challenges I had, but I found that it kept things exciting for me. I had to find the right team members, replace key functions within the team, find the right kind of funding and drive the growth of the company to keep the value for stakeholders. I was blessed to have a team that could make an impact over all three companies. My deep personal faith has always helped me with the confidence to get through these challenges.
What made last year the right time to sell TopOPPS and what made Xactly the right buyer? After challenges with competitors that had a funding advantage over me I adjusted the strategy to partnerships, which evened the playing field. One of the partners, Xactly, started a joint venture with TopOPPS that evolved into an acquisition offer which brought about a competing offer from another partner. After discussions with board members and investors we went with Xactly, which turned out to be a great decision and very successful for TopOPPS, now called Xactly Forecasting.
What’s your advice to young entrepreneurs who are starting companies today in St. Louis? Do whatever it takes to keep the passion personally and on your team. Those that don’t have great passion won’t make it and will harm the startup. I heard the phrase “Don’t be a know-it-all, be a learn-it-all,” which is good, but recruit other co-founders or team members that are awesome specialists at product, engineering, sales and marketing. Focus hard on product/market fit and don’t start your sales and marketing big push until you see very real benefits to your targeted buyer (that has an authorized budget). Remember, there’s always a way.
How can the St. Louis region improve as a place for startups and entrepreneurs? Stay the course in these areas:
Education on key functions of the startup by stage. Entrepreneurs need to know more about anticipated growth, different team members and specialties required at each stage. The founder/CEO has to adjust at each stage.
Create an environment that works for all entrepreneurs and investment institutions — success begets success.
Specialization is great, but don’t limit ourselves. Great ideas and successful startups can come from everywhere.
Outside of the companies you’ve launched, how have you helped grow St. Louis’ startup ecosystem? My current passions have been helping Arch Grants and OPO Startups with Randy Schilling. Each has a different focus on helping early stage startups. I am mentoring several young startup founders and meet on a regular basis with others just looking for advice. I invested in some and will continue to increase my time spent with startup founders.
With the sale of TopOPPS, you’ve launched three companies with significant exits. Will there be a fourth company at some point? My goal is to get more startups with successful outcomes for the ecosystem. I will concentrate more time with some that have a chance to become that rocket ship. We have a few real opportunities now and I want our ecosystem to continue to grow. That’s where I’ll be spending my time for the foreseeable future.
For links to profiles of winners and finalists in the 2022 Fire Awards and Startup Exit Awards, go here:
