The Relentless Drive of Christina Cacioppo

Building Vanta into a $1.6B category-creator

Author

Justin Gordon
March 26, 2023

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Chistina Cacioppo

Christina Cacioppo - Vanta

Christina Cacioppo is a rarity in the startup world as one of the few founders who has truly created a new category.

Her company, Vanta, was last valued at $1.6B after a Series B round of funding in 2022, a particularly difficult time for many companies to raise capital, and since starting the company in 2016, she’s raised more than $200M to make her vision of securing the internet into a reality.

Previously, I wrote about how Iman Abuzeid and her company, Incredible Health, allow hospitals to hire nurses in a couple of weeks instead of a few months - Vanta is similar in the massive value it provides.

Through Vanta, companies are able to automate compliance and scale their security practices, saving them months of time and thousands of dollars.

Hold on one minute though.

Compliance?

Security?

Admittedly, I did not expect to be writing about these.

As I’ve dug deeper into Christina’s story and what Vanta is doing, two things stand out.

First, it’s clear how important compliance and security are for businesses of all sizes, especially for B2B software companies.

Second, Christina’s journey to get to this point is remarkable in more ways than one, and you’re about to discover why.

Let’s get to it.

Early Days

Christina grew up in Columbus, Ohio, and, while I was trading sports cards I’d eventually sell on eBay in my youth, she was selling Beanie Babies and her old toys at the age of 11.

It’s clear from a young age Christina was a problem-solver and an article about her demonstrated just that:

And while Cacioppo took a roundabout path to becoming an internet security CEO, the challenge of securely transacting business online began dogging her in her first Beanie Baby hustle. “I didn’t have a credit card, and I was too afraid to steal my mom’s,” Cacioppo says. She did, however, have access to a Kroger. To keep her entrepreneurism secret, she managed payments through money orders bought at the nearby grocery store. “I was showing up on my bike with like $8.42 and sliding it across the counter,” Cacioppo says. It was her first time solving problems as an entrepreneur.

Sequoia Capital

Her parents were both academic researchers and this undoubtedly had an impact on Christina who, like many of the founders I’ve studied so far, is a voracious reader, keeping a list of hundreds of books she’s read since 2009.

In 2004, she started college at Stanford, where she’d end up getting a master’s degree as well.

Her internships every summer during that time are indicative of her wide-ranging interests and desire to do something impactful.

She would do an internship in Rwanda at a human rights organization, Thailand at the United Nations, Uganda writing about technology in a local newspaper, and also spend a summer at Google.

While in school, Christina switched her major multiple times before landing on economics and, after getting her master’s degree the year after, she would take a role at a company that would shape her views on startups, breaking the narrative that you had to be a “Mark Zuckerberg type of person” to build a world-changing company.

Union Square Ventures

Immediately after graduating from Stanford, Christina worked as a management consultant, a job she described as “not the life I thought I was promised.”

LOL.

Moving boxes on slides in a large corporate tower in NYC wasn’t quite for her.

So, after seeing a USV job post on Fred Wilson’s blog for an analyst position, she was intrigued.

It was a position where you needed to apply by showcasing your online presence, something a bit different back in 2010, and Christina almost didn’t even try:

But she did apply, got the role, and beat out 358 other applicants. This already should give you a hint of just how special she is.

During her 2 years at USV, she’d meet with 10 founders per week, learning about different businesses and types of founders, all the while building her own confidence in starting a business.

In fact, while at USV, she made $30,000 with her own company charging businesses to list jobs on a career website she had made for people looking to get jobs in VC and at startups.

Looking back, it’s obvious Christina was meant to be an entrepreneur.

While she liked early-stage venture capital and was learning a lot, she wanted to be the person on the other side of the table building a company and, as she would describe, she wanted to “go do things.”

Furthermore, Christina couldn’t code and this bothered her. She needed to make a change.

In November 2012, she left USV, with her bonus and savings as runway to allow her to go do things.

Projects on Projects

So, what exactly did Christina do after leaving USV?

She spent the next two years learning to code and working on a number of projects in the process. It certainly wasn’t easy:

Many of her 30+ projects wouldn’t see the light of day, but she did have one of them, Hoot, which was an android app she’d describe as “Snapchat, but worse, and themed with owls,” that did get some traction.

She started Hoot with Matt Spitz, a Stanford alum, working on the project for a number of months and getting a few thousand users before they both realized it wasn’t going anywhere.

They went out to sell the app, with Christina pitching potential buyers, one of them being Dropbox, which ended up offering them jobs. Matt took the job, but Christina wasn’t ready to give up her dream to build a company. They ended up selling Hoot for $20,000 to a teenage entrepreneur and Christina was on to her next project, a coding education platform.

This latest project, which involved her tutoring high school students, she realized didn’t map to her ambitions - the market for what she was doing wasn’t big enough.

She joined Dropbox not long after, a role that would lead to her starting Vanta.

Dropbox

In December 2014, Christina started at Dropbox, working on Dropbox Paper, their equivalent to Google Docs.

She was working as a product manager on a 10-person team and it was her first real professional experience managing other people. This team would grow to 80 before she left and prove valuable later on.

While working on Dropbox Paper and wanting to roll it out to Dropbox users to spark growth, she was met with resistance, as Dropbox Paper didn’t meet the strict security standards that Dropbox itself enforced.

One of those, SOC 2, is worth explaining.

To do so, I consulted with good ole ChatGPT:

Better?

I thought so.

Worth mentioning, it’s not like you just get SOC 2 certified overnight. At the time Christina first heard about it at Dropbox, the process would take about a year and involve significant company resources to get it done.

This experience stuck in Christina’s mind.

Starting Vanta

When Christina left Dropbox in October 2016, a string of events and a macro trend piqued her curiosity enough to make her want to explore this compliance problem further.

There was the email leak of the 2016 election, the personal information of Uber drivers and customers that leaked, and, later on in 2017, the Equifax data breach.

On a macro level, the trend of internet security seemed important to Christina, and all of these factors contributed to her wanting to solve this puzzle.

In 2017, working with a former colleague of hers from Dropbox, Erik Goldman, Christina started researching the problem.

One of the goals was to figure out how she could take this manual process, where companies had to talk with a consultant and learn about 100 different things they had to do to be SOC 2 compliant, and automate it with software.

The first thing she tried to do was standardize the list of tasks companies needed to do, but she was told she couldn’t do that because it’d be different for each company.

She interviewed people at three different companies, Figma, Segment, and Front, to learn how they handled compliance and security requirements.

An article from Sequoia Capital shared her breakthrough:

It wasn’t until she interviewed an engineer at Figma that Cacioppo encountered protocols that seemed substantial: laptop-management solutions, cloud infrastructure monitoring, quarterly pen tests, and more. When she asked why, she learned that Google mandated this rigor as a prerequisite for partnership. Cacioppo spotted a need for a tool that not only managed all of these protocols, but automated them. But she realized her idea wouldn’t just be useful to people who want to collaborate with Google. She could design a tool that helped all software companies with all kinds of compliance needs.

Sequoia Capital

The very first version of Vanta was a spreadsheet that she gave to those companies, showing them where they were at a high level, the tasks they needed to get done, and how close they were to being compliant.

Christina purposely did NOT want to start coding a solution right away. The spreadsheet gave her infinite flexibility and lowered people’s expectations early on.

Of course, she did start writing code to start automating her solution, but it was much more manual behind the scenes:

So first version of Vanta was a simple two field form to put in your AWS credentials. We will scan your third word for it, you'll look at the configuration in your AWS account, and then generate a report. It was sort of like generating our spreadsheet basically. And so we're like, “Oh yeah, just put in the credentials and you know, the software is a little slow, so we'll send you the report tomorrow.”

Meanwhile, behind the scenes, it's not much software. So we would get the credentials. We would go look at the AWS configuration, splat out all the information. And then I would go through and read the big data blob and write the report. That was the V1 of software.

And then, send it to people, and be like, “Oh, sorry, yeah, we're just a little slow, but here's your thing.” And they mostly believed us. They didn't, I think, think too hard… But yeah, the first version is just totally manual.

Christina Cacioppo

From that spreadsheet and then her lightweight solution, Christina and her co-founder continued to get feedback from customers.

Christina sent Vanta to about 10 more friends, let them play around with the product for a couple of weeks, and ran them through a survey.

She’d ask them questions like:

  • What did I give you?

  • What is Vanta?

  • Was it useful? Why?

And then she’d dive deeper into pricing, asking them:

  • What is an expensive price?

  • What is a reasonable price?

  • What is a prohibitively expensive price?

The feedback she got was inspiring.

Not only did people explain Vanta how Christina hoped they would, but they said they’d pay $10,000 for the type of solution she was offering.

Christina described it as a “drop-the-phone moment,” and couldn’t believe people were willing to pay five figures for the janky website she showed them.

Armed with that knowledge, Christina and her co-founder joined the W18 batch of Y Combinator.

Y Combinator & Crazy Growth

Christina mostly stayed under the radar in YC, even after finishing her time in the accelerator at the end of March.

After YC, she raised a $3M seed round led by Pear VC and by June, Vanta had early signs of product-market fit and was growing:

By late 2018, however, they weren’t where they needed to be, at least compared with other companies coming out of YC.

A YC partner talked to Christina, telling her that most YC companies have $1M ARR 9 months after YC. At the time, Vanta was somewhere between $150K and $200k.

While Christina was a bit shaken by this, she didn’t like the arbitrary timeline:

I didn’t want the arbitrary timeline of raising money to be something that I obsessed over. Nor did I want to at that point walk into a VC’s office and pitch Vanta without the full confidence that the product, the team, and the idea deserved.

Christina Cacioppo

So what did she do?

She kept on building - talking to customers, selling the product, and growing conviction.

6 months later, in mid-2019, her revenue was where it was “supposed” to be and the growth only continued:

By May 2021, Vanta had more than 1,000 customers and passed $10M in ARR. Their customer base also is doubling every six months at this point. All of this without raising a Series A, which companies typically raise when they hit the $1M ARR mark.

How did they achieve this growth?

In the early days and up until this point, many of their customers discovered them by word of mouth, much like Tope Awotona with Calendly. It’s easy to see why. With a product saving companies months of headaches and thousands of dollars, they clearly had product-market fit very early.

Series A

2021 was a massive year in the story of Vanta.

In May 2021, after not raising capital for 3 years, Christina announced Vanta’s $50M Series A:

Andrew Reed, a partner at Sequoia Capital, led the deal, joining the board of directors, and YC also participated, valuing Vanta at a reported $500M.

And just how did Andrew get connected to Christina?

Through the first and only ever non-optin intro from Dylan Field, founder of Figma, which is a Sequoia portfolio company that sold for $20B to Adobe.

It was a good sign for Andrew that Christina was a founder worth meeting.

This was peak pandemic times, they met on a hike, and Sequoia committed to leading their round days later.

Series B & Beyond

In 2022, through two separate announcements, Vanta let the world know about their Series B, which ended up totaling $150M and valued the company at $1.6B.

Craft Ventures led the Series B with Sequoia, YC, CrowdStrike, and a number of other individual investors participating.

And how did Craft Ventures hear about Vanta?

Their portfolio companies.

In the announcement of their investment, David Sacks raved about Vanta:

While there has been market turmoil in recent months, we know that innovation doesn’t stop during a downturn, and we have continued to seek out the very best companies to invest in. Vanta is clearly one of those companies: it combines a top-tier growth rate with excellent capital efficiency, as reflected by a superb burn multiple. The best companies don’t have to spend a lot of money to grow fast. Recessions have a way of separating the wheat from the chaff. We believe Vanta has the discipline and business model to thrive in any environment.

David Sacks

Christina’s company has 350+ people at this point and more than 4,000 customers.

They continue to launch additional products, like the Vanta Trust Reports, and innovate in the industry.

And why do I think they’ll continue to lead the market they created?

This excerpt from an amazing piece by Mario Gabriele says it all:

Though its existing product is already robust and market-leading, the team relentlessly looks for ways to improve. Logvinksy pointed to this as a core characteristic. “I think we’ve built a culture that pushes harder on each other,” he said.

Interestingly, when I asked Cacioppo why she had gone with Sequoia for Vanta’s Series A, her answer rhymed. “They push,” she said, “And we always push ourselves.”

Mario Gabriele, Founder of The Generalist

Christina’s Wisdom

In each edition of the Just Go Grind newsletter, I like to include a few more quotes at the end from my research into the founder who is featured, sharing their wisdom.

On building her competitive advantage:

Twofold that I'll share out about, and it's a constant conversation internally at Vanta, as you might imagine. One is actually on the commoditization piece. Just, can we drop the cost of getting a SOC 2 generally? I think we have, maybe slightly less the dollar costs, but very much the time and effort costs and mental overhead piece. This is standardizing, standardizing what a SOC 2 is, how you prove it, what these pieces are. This helps us.

Also, I think it makes it easier for some competitors to build on. I think actually the important part is it is “Vanta standard way” and other people can totally use that.

Who is defining what the industry needs? That's Vanta, because that's what we've always done.

Back to the early days of "Here's a very rigid list of things to do." There's some amount of, like the Wizards of the Coast example always gets used here, but they standardized some of the game design pieces. Then there was a lot more game design.

Christina Cacioppo

On thinking critically about fundraising:

We often celebrate the big PR moments and it’s really fun to have your team’s photo in Forbes or have this record sales month or week because of your financing announcement, but at the end of the day, I think the most important part is building the business you want and your team wants and a business that you all are proud of. If a high-profile investor is proud of your business that’s great, truly, but they’re not in it day-to-day, you are.

Christina Cacioppo

On how you quality control decision-making:

Culture. And one of our values and actually we recently did something of a poll internally. Our most popular value is our most controversial one, which is frameworks thinking, which is basically have a framework for your decisions and articulate it.

And we're actually not prescriptive about which framework you use, but we are prescriptive in that you have one and it's articulated. And I think that mostly just has the effect of making the decision maker stop. And even if they're like, look, I know the answer is you have something on the homepage, it still makes them stop and write down why that is the right answer and that forces them to think through it. And so that I think is actually one of our better tools for that.

Christina Cacioppo

On what she’s a novice in, but thinks is important:

One, structuring relationships with other folks in our ecosystem. So whether it's audit partners or kind of adjacent vendors. I think coming from VC people think you're probably great at this stuff, but it was only two years. I was like mostly talking to people, right? I wasn't giving out term sheets. So that piece of just learning how to structure some of those relationships, so both sides are quite happy with them sort of gets at the discovery of what's actually important to you.

And I think the first answer is always revenue, but then you keep going and there's five more interesting answers that you can really build around there.

I think honestly brand marketing and just profile raising. We've been really quiet about Vanta for the last few years… And so just, how can we raise the profile of the company in what we're doing, where honestly, a lot of this stuff doesn't come super naturally to me. I am much more of a like, “I'll just go sit in the corner and work and emerge when you're done.” That's not quite the game on the field. And I think you do have to play the game on the field.

Christina Cacioppo

On what makes Vanta unique:

So in the early days, we talked about customers on a first name basis, talk about Dan. Here's how Vanta made Dan happy and sad. Everyone knew Dan is a real person. Everyone knew what Dan did was happy and sad.

And we talked about it in that way, which is in some ways really juvenile, but it was actually just like emotional and kind of purposely so because it was like, look, we're building software for millions of internet businesses, ideally, but also there's real people behind it and our decisions affect them.

And I think while we're past the stage of everyone knows who any given Dan is, there's very much that ethos. That is our version of customer centricity, where we are building software that affects real people. And again, it makes them happy and sad. We're going to do the best to take that kind of responsibility seriously.

Christina Cacioppo

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