Why Underscore VC Invested in Coda
6 min read

The Future of Workplace Collaboration: Why We Invested in Coda’s $80M Series C

As much as I hate to admit it, at the start of 2020, the Underscore VC team was in what I’d call “systems hell.” Our growing team was working in siloed tools, building disconnected spreadsheets, and creating countless lone documents—all while tirelessly trying to hack them together to stay organized and boost our productivity.

We were trying to create our own version of a “neural network” of information and operations, but we missed the synapses—the connections—entirely.

On a quest to find a solution to our mounting challenge, we tested out dozens of collaborative work platforms. That’s when we found the answer: Coda.

Personally, I was wowed by the depth of Coda’s functionality. The best elements of tables, documents, and apps allowed our team to get work done quickly. And its flexibility enabled our teams—technical and non-technical—to build the connected systems needed to meet our unique needs.

Our firm’s synapses were finally firing!

Within a short time, key elements of investing systems were humming along on Coda. And as the Coda team regularly blasted out impressive product updates, it became clear to me: I needed to meet the founders behind this special product.

Meeting Coda’s co-founders, Shishir Mahotra and Alex Deneui, sealed the deal. We had to invest!

Shishir and Alex’s shared history, unique qualifications, and bold vision have put them on track to build a future of work that the Underscore team not only wants to live in, but invest in. That’s why we’re excited to announce our investment in Coda, contributing to their $80M Series C funding alongside Kleiner Perkins, Madrona Venture Group, NGP Capital, Hawk Equity, and Renegade Partners. With this investment, we join existing investors Greylock, Khosla Ventures, General Catalyst, and New Enterprise Associates.

The Future of Work: Docs as Powerful as Apps

Despite an explosion of business SaaS tools, most companies still run on one-off documents, spreadsheets, and siloed project management tools, i.e. “systems hell.” Coda is primed to change that and has set a solid foundation to shape the future of work.

Coda has ripped the traditional document down to the studs and created a new set of building blocks that bring words, data, and teams together, empowering anyone to make a doc as powerful as an app. By combining the best elements of docs, tables, and apps, Coda users don’t need to ping-pong between documents, spreadsheets, and niche workflow apps—they can track projects and get things done in one centralized location.

With customized views at the user level, you can work off the same data as your team, in your preferred way. Buttons, controls, formulas, and the ability to integrate tools through Packs, Coda’s version of plug-ins, make Coda programmably flexible. Plus, the Doc Gallery of free templates and tools extends best practices and expertise to anyone using Coda.

We’ve contributed our own template to the Doc Gallery—Game-Changing SMART Team Systems at Underscore VC—so interested users can quickly adopt (and adapt!) our team’s objective setting, check-in, and meeting agenda systems that we’ve refined over time.

Why Did Underscore VC Invest in Coda?

Honestly, Underscore had no right to invest in Coda. We’re a Seed to Series A investor focused on Boston, and Coda is a Silicon Valley startup at its Series C. Square peg, meet round hole. And yet, we had to invest. Here’s why:

Uniquely Qualified Founders With a Strong Vision

We are deep believers in investing in world-class people solving big problems. That’s easy to say and hard to find, but we found that in Shishir and Alex.

Shishir and Alex have roots in Boston, as former MIT classmates. They’ve been starting companies together ever since, each taking formative roles at prominent tech companies in between ventures. The two have built the last generations’ productivity tools at Microsoft (WinFS, Office) and Google (Docs, YouTube), earning them high industry praise.

They have a deep understanding of file and document architecture, are extremely product-centric, and have a passion for empowering the “Maker Generation” to create business apps. Combined, these qualities give us the conviction that they’ll win an important place in the business productivity market.

Alex DeNeui and Shishir Mehrotra (1)

A Large Future of Work Market Opportunity

Shaping the future of work and how teams collaborate is a big opportunity in the earliest stages of a major transformation. From a top-down perspective, it is estimated that the market for business productivity software is ~$100B. The TAM for the collaborative applications and project/portfolio management sub-segment alone is $23B, according to Forrester, with IDC expecting the TAM to grow to $31.5B by 2021.

If you’ve worked in a growing organization, chances are, you too have found yourself in “systems hell,” and it’s easy to understand why this prevalent and painful problem is driving such a large market.

In organizations that fully embrace Coda, like Uber, it becomes the single source of truth and delivers compounding value as teams continue to use the platform. At Underscore, we’ve experienced this first hand, and other Coda customers were similarly quick to share their product adoration during our diligence.

Customer Product Adoration

Coda customers—Underscore included—don’t just like Coda, they love it. Customer calls and case studies with Intercom, The New York Times, Spotify, and others indicate that Coda has set a strong product foundation. And the data backs this up—the product has earned meaningful customer growth and viral usage growth month-over-month.

As one customer put it, “Coda is the connective tissue of the organization.”

Another customer remarked that Coda had radically changed her work life for the better, and described working in the tool as “deeply satisfying and oddly fun.” Fun is not a word you usually hear associated with business productivity tools.

What Does The Future Hold for Coda?

The built-in virality of Coda’s product has delivered significant customer growth, but as they enter into their next business building chapter, they’ll supplement their existing growth drivers with a strong go-to-market motion. That’s where Underscore’s Core community has come in.

We invited several Core Members with go-to-market experience to invest alongside us in Coda: Paul English, Chris Comparato, Jono Bacon, Erica Brescia, Jeff Barnett, Christopher Litster, and Emily Green. In addition to these Core investors, we’ve begun to work with the Coda team to identify other members of our Core community that they wish to bring in as Core Partners and builders for the road ahead.

Coda Investors

Coda Investors

Everyone we talk to that’s touched Coda is convinced there’s a major opportunity for both the product and the company. We learned that Toast, in our own backyard, is experiencing Coda as a game-changer. That’s exactly why we invited their CEO, Chris Comparato, to invest alongside us. We’re excited to continue to expand the Coda network on the east coast and empower customers around the world as we create the future of work together.

Want to Learn More About Coda?

If you’ve found yourself in “systems hell,” it’s about time to look into Coda. Once you do, be sure to check out their DocGallery, now including Underscore’s Game-Changing SMARTY Team Systems template, and let us know what you will Coda!

We can’t wait to partner with you and Coda to grow your business, and bring order to system chaos for teams everywhere.