Koan, a startup founded by former Jive Software executives, has raised $3 million to build software that helps business leaders keep their teams on track. The company plans to use the money to hire talent and grow its platform.
The round was led by Uncork Capital with participation from Crosslink Capital and brings the startup’s total financing to $5 million. The Portland, Ore.-based startup is also backed by Yahoo chairman Maynard Webb’s Webb Investment Network and other angel investors.
The vision of Koan is to make a company’s objectives a tangible team effort. Its platform lets teams track their progress toward big-picture goals, which often takes the form of objectives and key results (OKRs).
“Small, positive behaviors done repeatedly lead to a big impact,” Koan CEO Matt Tucker said in an interview. “We apply that directly to how teams and companies check in and manage their goals. We’re essentially trying to drive a structured collaboration process.”
To accomplish this, Koan encourages employees to adopt the regular practice of reflecting on progress with a dashboard for tracking goals, providing feedback, and other people-management tools. Tucker thinks this process can replace status meetings and weekly reports.
Regularly assessing goals leads to what Tucker calls the “Karate Kid principle.” In the movie The Karate Kid, Daniel asks Mr. Miyagi to teach him karate — what he gets is a list of chores that include waxing the car and painting the fence. After an epic training montage, Daniel realizes that the chores were Mr. Miyagi’s way of teaching him martial arts.
“[Daniel has] essentially been building mastery by doing. And that’s exactly what we’re trying to build into software,” said Tucker.
Koan emerged from stealth mode last year and already counts 130 companies as customers, including Carta, Iterable and Vacasa. The startup recently launched a partner program for management consultants to implement business changes using its software.
“Leaders in competitive sectors know how important it is to engage every team with the company’s strategy through OKRs and other processes. Now is the time to move these critical behaviors out of spreadsheets and off whiteboards and into a specifically designed product that users love,” Uncork’s Andy McLoughlin said in a statement.
Koan is similar to Ally, a Seattle startup that also helps companies track OKRs and raised $8 million in August. Other competitors include 15Five, BetterWorks, Khorus and Workboard
Tucker co-founded Jive Software and worked there with Scott Campbell, who now serves as Koan’s chief revenue officer. Jive went public in 2011 and was acquired by private equity group Aurea in 2017.
The name of the 10-person company is drawn from Zen Buddhism. Koan’s are short anecdotes or questions meant to inspire deep reflection, such as: “What is the sound of one hand clapping?”
“We liked that as an analogy for what great leaders do, which is: ask great questions and then discover and improve through this process of reflection,” Tucker said.