It takes a lot to build a successful business. You have to identify a customer need—a real one, not just something you think they might want—figure out the technology, decide on a product, get your timing correct, hire a great team and get it into place, and create a profitable business model. Getting all these things right is a formidable challenge, and more than a few startups have failed because they didn’t.

But even when a business successfully makes it through all these challenges, there’s one more thing that will ultimately make the difference between success and failure: execution.

In many ways, your startup has powerful advantages over the incumbents in your industry. You bring fresh insights into how the market can be served, new capabilities to build a compelling product, and the agility to make and implement decisions more quickly. But even so, you have to overcome the incumbents’ distinct advantages, including profit pools, technology capabilities, and the strategy and motivation to compete. The way to do this? Execution.

Let’s take a look at how one company in the Next47 portfolio, Verkada, executed its way to tremendous success in a startup context.

The Founding Team

Verkada is a provider of cloud-based enterprise security solutions, and it’s seen tremendous success over the past 7 years. Founded in 2016, Verkada grew from 38 customers in 2017 to more than 20,000 today, it has developed and fielded numerous product lines and the company has a current valuation of $3.2 billion. We led the Series A funding round in 2018, and I joined the board at that time. This position has given me a unique perspective on what has made Verkada a success.

The company was founded by Filip Kaliszan, Ben Bercovitz, James Ren, and Hans Robertson. While this founding team did many things right to get to where they are today, I am convinced that the company’s success was—and continues to be—in great part due to the team’s ability to execute.

I had already seen Hans Robertson in action at Meraki, a mesh Wi-Fi networking company that he co-founded in 2006 and that was acquired by Cisco in 2012 for $1.2 billion. I was impressed with Hans’s intensity, his skill for building strong teams, and his ability to consistently attract and retain talent—A+ players with great attitudes. He was tapped to serve as Verkada’s executive chairman.

When I met CEO Filip Kaliszan, I could immediately see that he brought the same intensity and skills. In 2007, while he was still at Stanford studying computer science, he cofounded CourseRank, a startup based on a class project. The founding team steadily grew the business and it was acquired by Chegg in 2010. Clearly, the ability to focus on what to do and how to get it done was embedded deep in his DNA.

Together, Verkada’s founding team showed that if you can execute, you don’t need a magical advantage over the competition. Relentless execution is key to success.

The Opportunity

Verkada’s founders had two fundamental requirements for their new company. The first was to start a company that would allow them to build products that would keep them interested and engaged. The second was that the market would have to be big and meaningful. They wanted to make an impact.

Uniquely, the team gave themselves plenty of time to explore the many different opportunities that fit these two requirements. There was no rush to just check the box and move forward—they wanted to find the best opportunity. Says Filip:

One of the best things we did that contributed to Verkada’s success was we told ourselves that we would take a period of up to 12 months to explore different ideas without starting a company. But we worked very hard every day to build things and prototype them until we found an idea that met those two requirements that we felt good about and that we wanted to chase. Filip Kaliszan

As it turned out, they didn’t need the full 12 months to settle on an opportunity—it took just 6. The decision was to focus on developing video security products, and within six months after that, Verkada had developed its first prototypes.

While you may think that there’s not much room for a startup to grow in the physical security industry, that turned out not to be the case at all. When the founders dug into the opportunity, they discovered that the incumbents were very old school, and the technology they relied on hadn’t seen much innovation in many years. Because of these and other reasons, the market opportunity for a cloud-based product that would reduce on-premises for customers was tremendous.

As they built the foundations of their new company, the team asked, “Do we have a shot at building something that is as awesome as something that Google or Apple built?” Of course, both Google and Apple had giant teams of employees and nearly unlimited resources. With only a fraction of those people and resources, there was no way Verkada would be able to build as many great products as those companies could. However, the founders were convinced that if they could just identify one or two experiences where they could do a better job at first, then that would set up Verkada for success.

And while their first product wasn’t perfect out of the gate, the team showed it could execute, iterate quickly, learn, and quickly improve. Says Filip,

Our first-ever product was missing many features…but there were a couple aspects of this product that we got very excited about making better than what anyone else was doing. And those little touches made our product win. Any of our competitors could have done them, but they didn’t. We did them, and we did them to a very high level of execution. And that’s what got customers excited. Filip Kaliszan

Verkada had the right opportunity, the right product, and was on the right track.

Execution—The Beating Heart of the Business

Any company that grows quickly is bound to make mistakes along the way—Verkada is no exception. Like every startup, the company has hit some bumps on the road to success. What has made this particular team excel, however, is that when they encounter a challenge, they lean on their execution skills to learn, course correct, and make the kinds of good decisions that have kept the company on a steep growth trajectory.

Long-term success requires having fully engaged, high-performing people who are able to identify mistakes, take corrective action, and then never repeat them again. If someone on your team isn’t executing, then you need to quickly identify the problem and take action. How you handle these kinds of decisions will have a big impact on your team’s ability to execute, and along with that, their performance.

The ability to make good decisions is at the very heart of execution. The faster and better you are able to make key decisions, the faster and better your company can execute. According to Filip, decision-makers most often deal with two distinct categories of problems: those that are urgent but not important and problems that are important. To execute well, you have to be able to identify and separate the two and act upon them appropriately. Otherwise, the problems that are urgent but not important will become the quicksand that holds you back from doing the important things. Filip explains:

It’s important for every executive to dedicate their time where it really matters most. And in my case, it’s focusing on the things that are important, not urgent. I have hired people in different areas that I think of as better than me—people I can trust and delegate a lot of the urgent problems to. That frees me up to focus my time and energy on the things that make the greatest difference over the company’s long term. Filip Kaliszan

Filip uses the example of long-term product execution versus near-term sales execution to illustrate his point. As he says, “If I was in every deal call, I think we could move the needle by maybe 20, 30, or maybe even 40 percent the next two quarters. And is that urgent? Sure, that’s urgent because many of our investors would get excited if we made more money tomorrow. But is that where I should focus my time? I don’t think so.”

He goes on to explain that he would rather focus on thinking about how to build a product that the company will launch up to 18 months in the future, and how that product will integrate with everything else. If he spent the same amount of time making an incremental increase in sales, he might be able to gain maybe $10 million in the next quarter. “But if I focus my time on the new product,” Filip continues, “I might actually create the kernel or foundation of something that becomes billions of dollars of market opportunity or value over the long term. That’s where I need to focus my time, and that’s where I personally execute.”

I am inspired by the entire team at Verkada, and their ability to execute with passion and precision every day. Without a doubt, it is the execution that has put Verkada on a trajectory to be a category leader in physical security far into the future. And by executing with passion and precision—every day—I am convinced you can do the same.