Unpacking Jama Software’s $200 million round

Yes. $200 million. For a Portland startup. It’s really really easy to blanche at that number. I get it. It’s a big number. Especially for a homegrown Portland company in the software world. And were this earlier in the life of Silicon Florist, I could have easily focused on the number, cheered for a company raising that much, and moved along my merry little way.

But at some point in the last decade, I made a promise to Jive cofounder Bill Lynch that I would get out of the mode of celebrating fundraising for fundraising’s sake. And to look deeper into the subtext of funding rounds—how those rounds impact companies or our startup community or Portland. In other words, I’d focus on how the money will effect change in our community.

So when my phone lit up this morning with a bunch of stories about Jama Software raising $200 million, I knew I had a bunch of mulling ahead of me. And, while I haven’t quite got the bag of cats that is my brain wrapped around it, here’s where I am so far…

Homegrown company with dry powder

These days, homegrown Portland startups have a lot more competition for talent than they did back in the day. With all of the well funded regional offices—*cough* AWS *cough* Google *cough*—these homegrown companies need the ability to be competitive with wages and benefits. This funding helps Jama do that.

Late bloomer

Remember, Jama is among the oldest of this generation of Portland startups. Dating back to its founding circa 2006. And Jama played it smart by building a reputable business through bootstrapping. They’ve only dipped their proverbial toe—or in this case, dove headlong—into venture capital later in life. With a more thoughtful and intentional pursuit of outside capital, one hopes that this raise is a methodical and reasonable way of funding the company’s pursuits. And providing a new role model for how Portland companies can build businesses.

Madrona doubling down on Portland

When it comes to outside funds investing in Portland—First Round, Foundry, Madrona, and True, among others—I always view them as gamblers sitting around a roulette wheel, waiting for the ball to fall. And waiting for existing Portland bets to pay off before they put more chips on the table. Madrona, in particular, has been doubling down on Portland, lately. And for a fund cofounded by someone who made a risky bet on a small Seattle bookshop named after a Brazilian river, I have to respect their chutzpah.

More meager rounds give way to more massive rounds

With Portland startups like Vacasa and Jama raising three-figure rounds—or nine-figure if you spell it out… I mean, if you can spell out numbers—this marks a new trend for Portland startups, who are foregoing chasing multiple early rounds for taking on bigger rounds as necessary. Will that strategy pay off? We’ll have to wait and see. But you know me, fingers crossed.

For a town built on an ancient unicorn burial ground…

Yeah. Portland has managed to corral few modern day unicorns, if any. But given the amount of funding Jama has taken on, they’ll require an exit north of $2 billion to be deemed truly “successful.” And that puts them in the valuation of the, once fabled, unicorn company. Which, for the most part, remains truly rare for Portland.

Liquidity for early investors

An announcement from the Bend Venture Conference—which had invested in Jama in 2008—revealed that this round was an opportunity to exit for some of the early stage investors in Jama.

So that’s what I have so far. No doubt further mulling will result in a few other insights. But, let’s be honest, I don’t know that they’ll be terribly insightful. But rest assured, I’m tracking this and thinking about it a ton.