Linear, the startup that was profitable before it was famous
Linear is Reviving the Art of Software Development by Redefining Productivity and Team Management. Let’s find out how.
Dear Enthusiasts,
This week on Soul Startup, we uncover Linear's extraordinary rise. Inspired by Lenny Rachitsky's insights, we explore how Jori Lallo, Tuomas Artman, and Karri Saarinen led Linear to profitability within a year, maintaining a negative lifetime burn and exceeding their fundraising in cash reserves.
About Linear
Linear is more than just a tool; it's the preferred way to develop software. It began as a simple Issue Tracker but has evolved into a system that streamlines the entire product development process, hence the name "Linear."
Linear follows the Linear Method, prioritizing simplicity, efficiency, and quality in software development. It focuses on user-centric project management, promotes opinionated software, and emphasizes individual productivity. With a user-friendly interface and automation features, Linear excels in bug tracking, code management, and planning, making it reliable for rollout strategies.
What truly sets Linear apart are its unconventional practices, including the absence of dedicated product managers, reliance on project-based teams, a singular company-level metric goal, preference for taste and opinions over A/B testing, the incorporation of paid work trials for job candidates, and a fully remote team, which has been the core of its operational model.
Linear targets engineering and product organizations, with an initial focus on small tech startups and later expanding to larger enterprises. Their customer base includes over 60 large software companies, such as Vercel, Ramp, and Retool. Competing with JIRA, Monday.com, and Gitlab.
Linear offers a freemium SaaS model with Free, Standard (priced at $8-$10 annually or monthly), and Plus tiers ($14 per user per month).
Funding and Valuation
Linear, a software company, boasts a significant cash reserve exceeding the total funding it has received from venture capitalists.
With a total funding of $52.2 million across three rounds, their latest Series B round on September 14th raised $35 million, led by Accel with participation from 26 investors.
Linear counts 7 institutional investors and 42 angel investors among its supporters.
Impressively, Forbes has valued the company at a staggering $400 million.
Founders
Co-founders Jori Lallo, Tuomas Artman, and Karri Saarinen, originally from Finland, met through the Helsinki startup community. They worked in senior roles at tech giants like Coinbase, Uber, and Airbnb before founding Linear in 2019.
Inspired by their frustrations with software management tools, they started Linear as an issue-tracking system for small companies. It grew in popularity for its speed and design, eventually evolving into a comprehensive tool for teams of all sizes.
Conclusion
Linear is streamlining Agile workflows by simplifying onboarding, prioritizing design and speed. They aim to reshape product development, engage engineers, and become a key factor in talent attraction. However, the risk of cost-cutting in software expenses remains a challenge. Tracking Linear's progress and cultural integration can be done through their changelog.
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