DemandBase Revenue Growth

One of Demandbase's core technologies is real-time visitor intelligence for ABM.
One of Demandbase’s core technologies is real-time account-level visitor intelligence for ABM.

Nathan Latka interviewed Demandbase CEO Chris Golec back in Q4. Demandbase is growing rapidly and now employs 300. In November, Golec said the firm was likely to achieve 50% or greater growth in 2017. 2016 revenue was around $75 million and the firm was above a $100 million run rate in November. Average revenue per customer is around $20,000 per month. Small customers may select a single module for $2K to $3K per month but then add multiple solutions as they grow. Net revenue retention is around 110%.

The firm has between 50 and 60 quota carrying reps, 20 to 25 marketers, and 10 to 15 administrative staff, with two thirds of the company focused on data, R&D, engineering, and other functions

The firm has 400 to 600 customers with top customers spending a couple million dollars per annum.

Golec expects the firm to be cash flow break-even during the first half of this year.

Demandbase, founded in 2007, was an early and forceful proponent of Account Based Marketing. For several years, they had a monopoly on the positioning, but ABM caught fire as a B2B sales and marketing process with several enterprise software firms including Marketo and Salesforce now offering ABM solutions.

“ABM as a category – the interest level has reached the investment community and so as investors do their research they discovered that Demandbase is the largest and pioneered the category itself.  So we had a lot of inbound interest.  At the same time, we started developing some new innovations using AI and massive data that we’re sitting on. So it really unfolded into a whole new level of innovation.”

  • DemandBase CEO Chris Golec

DemandBase has already received $156 million in funding, including a $65 million round last May. Both Salesforce and Adobe have taken investment stakes in Demandbase.

While some MarTech firms are struggling with revenue growth and churn, that has not been an issue at Demandbase. “ABM is more of a business process and our position is much more of a platform where we’re helping customers throughout the whole lifecycle of attracting, updating, engaging, converting, and upselling them.”

The firm has ten staff in London helping grow European sales. “ABM adoption in the UK and Western Europe is really starting to pick up.”

Source: Nathan Latka SoundCloud Interview of Chris Golec

CrunchBase Launches Marketplace Partner Ecosystem

SimilarWeb Web Traffic Analysis within Crunchbase Pro.
SimilarWeb Web Traffic Analysis within Crunchbase Pro.

Crunchbase unveiled their long-planned Crunchbase Marketplace partner ecosystem.  Crunchbase signaled plans for the ecosystem a year ago when it announced an $18 million funding round.  Partner datasets are available via an “app store” connected to their subscription Crunchbase Pro data service.

“We see this as the next step in building the master database for companies online. We don’t feel like a single company can go out and get all the information that there is to get, which is why we have decided to partner.”

  • Crunchbase CEO Jager McConnell

Crunchbase has signed 13 data partners: SimilarWeb, Apptopia, BuiltWith, Siftery, IPqwery, Bombora, Owler, Financial Content, TradingView, Enigma, Wayback Machine, Aberdeen, and Wikipedia.  The span of partners is fairly broad and includes technographics, intent data, web traffic, app installs, government filings, and stock quotes.

The following datasets are live:

  • Crunchbase Pro – Funding data available for $29 / user / month
  • SimilarWeb – Web traffic and engagement (free)
  • Siftery – Tech Stack data for $49 / user / month
  • BuiltWith – Tech Stack data for $49 / user / month
  • Apptopia – Mobile app analytics for $49 / user / month

“We’re super excited about these partnerships because they are bringing up a ton of new data that we’ve never seen before,” McConnell added. “We think this is the first time that someone has taken all this data and put it all into one place. Looking further out we think that all enterprise software will be built on large data sets, and we think that we can be the trusted source for all that company information on the internet.”

Crunchbase is looking to increase the number of registered and Pro users on its site, so only registered users will have access to the marketplace.  Last year, Crunchbase had 40 million unique users, many of whom were anonymous.

Current licensors of third-party datasets do not have free access to the content via the Marketplace.  However, Crunchbase is evaluating a voucher system for dual licensors.

Crunchbase said it is unsure whether the current $49 per month fee will be modified.  For example, they are open to building solution bundles by function which support multiple datasets.  However, such a model has yet to be explored.  They are also considering a freemium model with in-app purchases of additional data beyond a limited number of free records.

Crunchbase will continue to focus on its strength: – the collection of funding data.  “Logo, name, address, funding, founding and investor data: we’ll always own that node,” McConnell told TechCrunch. “This is the reason why most come to us today and we don’t want to jeopardize this.”

Crunchbase would like to build out to one hundred partners over the next year.

Dun & Bradstreet CEO Robert Carrigan Steps Down; Q4 Earnings

DNB Hoov Company Profile of DNB
Dun & Bradstreet’s company profile displayed within their D&B Hoover’s product.

Last week, Dun & Bradstreet CEO Robert Carrigan resigned as CEO, board member, and Chairman.  In his absence, Thomas Manning has been appointed Chairman and interim CEO.  Manning has been a board member since 2013 and Lead Director since 2016.  He previously served as the CEO of Cerberus Asia Operations & Advisory Limited, CEO of Capgemini Asia, and CEO of Ernst & Young Consulting Asia. He was also a senior partner with corporate strategy firm Bain & Company where he led the global IT practice in Silicon Valley and Asia.

No reason was given for Carrigan’s departure beyond that it was a mutual decision.

“Over the last four years we have made progress transforming this company. We’ve improved our data and analytics, developed solutions and capabilities to serve new customer use cases, and modernized our products and platforms.  The Board is confident in the strategic direction of the Company, and fully believes that this business can deliver sustainable mid-single digit revenue growth and expanding margins.  Our number one priority is accelerating value creation for shareholders.”

  • Dun & Bradstreet Chairman and interim CEO Thomas Manning

However, the company is not growing revenue and profits quickly enough.  To address the slow growth, the firm engaged McKinsey & Company two months ago in a strategic and operational review “to help us find ways to speed up the time to realize value,” said Manning.  “The first phase of their work validated our strategy and identified barriers to growth and cost opportunities. The next phase of their work will include a full portfolio and business assessment and we are open to considering all options for value creation that may be identified.”

McKinsey validated the basic DaaS strategy around premium company, contact, and risk data.  McKinsey’s primary concern was the “breadth of our offerings and distribution channels” which increased the level of operational complexity.  The updated strategy will look to “simplify and streamline the business.”

Dun & Bradstreet is also looking to “apply more specialization to our selling activities as we go deeper into the sales and marketing space,” said Manning.  “As we expand our sales and marketing value proposition from being primarily a static data supplier to becoming a dynamic player in the digital sales, marketing and advertising space, we are working to make sure that our organization, go-to-market strategy and processes are aligned with that goal.”

The firm hired David Godfrey, who previously ran Global Sales at Gartner, to oversee go-to-market strategy and execution.  He will be reporting into Manning.

James Fernandez, new Lead Director of the Board, said, “As Dun & Bradstreet continues its work to drive sustainable growth, the Board believes now is the right time to transition the Company’s leadership. We are pleased to have a leader of Tom’s caliber and experience to step in as interim CEO. The Board will continue to support the Company, and lend our expertise to the organization and Tom during this transition period as we conduct our search for a permanent successor.”

Q4 Earnings

Q4 earnings increased 3%, but only 1% organically, to $527 million.  Total revenue hit $1.75 billion in 2017 with 83% in the Americas.  The firm maintained expense discipline resulting in a ten-basis point improvement in margins while investing $40 million on initiatives which “transform our technology platforms in order to meet our customers’ modern-day needs,” said CFO Richard Veldran.  “Modernizing delivery of our solutions is a critical component of our strategy.”

Data-as-a-service delivery continues to increase.  Nearly 30% of Americas revenue came via as-a-service solutions “which makes our data stickier and more useful for our customers and drives higher-value revenue.”

Amongst the 2017 initiatives were upgrades to D&B Credit and new D&B Optimizer solutions for Salesforce and Microsoft.

Deferred revenue was up 3% year over year before M&A activity and currency adjustments.  Growth was attributed to D&B Credit, D&B Hoovers Q4, and the D&B Direct API.  President and COO Josh Peirez noted that the D&B Credit Suite revenues were no longer declining and that the company is well-positioned in D&B Credit, D&B Hoovers, and D&B Direct.

“We think we’re well-positioned to address the competitive challenges.  We’re also pleased that McKinsey has validated that opportunity and that strategy and helping us to make sure that we are packaging and bundling these things properly.”

  • Dun & Bradstreet President & COO Josh Peirez

Taxes, which were 31.4% in 2017, are expected to drop to the mid-20s due to the US corporate tax reforms.  The reforms will also allow the firm to repatriate $265 million to reduce debt levels.

No guidance was provided as the firm is beginning their operational review.  Veldran promised more details on the Q1 call.

Dun & Bradstreet raised its quarterly dividend by two cents to $0.5225 per share.

The market reacted very positively to the announcements, driving Dun & Bradstreet’s stock price up nearly 8% after the earnings call.

Segment Growth

Sales & Marketing Solutions (S&MS) rose 4% in the Americas to $240.1 million in Q4.  Growth was led by Sales Acceleration products which rose 9% to $84.3 million.  For the full year, Sales Acceleration grew 10% to $288.4 million in the Americas with the Avention acquisition contributing twelve points of growth.  Legacy Hoover’s drove down organic Sales Acceleration revenue with traditional Hoovers revenue declining by mid-single digits.

Revenue for the new D&B Hoovers service (Dun & Bradstreet content delivered through the Avention platform) increased in 2017.  However, the decline in revenue from the partnership will result in a decline in 2018 Sales Acceleration revenue. generated around $50 million in revenue in 2017 with the firm continuing to sell through August 2017, resulting in a flat year.  Veldran projects a $15 million decline in revenue.  Dun & Bradstreet is looking to recapture some of that decline as new D&B Hoovers and D&B Optimizer for Salesforce contracts.

Peirez is quite pleased with the trajectory of the D&B Hoovers business.  “We think our products are far better than anything else in market. We continue to see the overwhelming majority of customers that are buying our D&B Hoovers product buying the higher level of the product with the integrations to CRM, so that’s extremely encouraging for us.”

The firm is also moving to migrate its Hoover’s customer base over to D&B Hoovers.  In Q4, more than ten percent of the legacy base moved to the new platform as Dun & Bradstreet “started to move very aggressively in getting the customers upgraded,” said Peirez.  While the D&B Hoovers Suite grew low-single digits in its first year, Peirez expects growth to accelerate in year two.  The company has told users that the legacy platform will be phased out at the end of the year.

Advanced Marketing Solutions grew 2% in Q4 to $155.8 million in the Americas.  For the full year, growth was 2% to $383.9 million.  While revenue was up mid-single digits in H2, the product line was weighed down by H1 weakness.

Outside the Americas, S&MS grew 17% to $16.9 million in Q4.  For the year, S&MS non-Americas revenue rose 18% to $60.4 million.  Growth was driven by Sales Acceleration products, including the acquired Avention product line.  Sales Acceleration products jumped up 24% to $7.5 million in the quarter and 39% to $27.7 million for the year.

The D&B Hoovers Suite rose 26% to $42.6 million in the Americas in Q4 and 22% to $166.5 million.  Outside of the Americas, D&B Hoovers Suite rose from $0.6 million to $5.3 million in Q4 and $3.1 million to $16 million.  While the classic Hoover’s product line had little overseas sales, the new D&B Hoovers product line, built on the Avention platform, benefited from a longstanding presence in the UK, Singapore, Australia, and India.

EMM LeadPorte Global Contact Prospecting

Email address compiler Every Market Media (EMM) announced the “early access launch” of its B2B list tool LeadPorte. The Build a List service provides access to 55 million US and 7 million international contacts. All of the records have emails and a subset have direct dials. The service, which is nearing the end of its beta period, has already delivered 7,500 counts and over 2,000 CSV file downloads to over a dozen beta customers.

Users have access to global company and contact screening via standard filter variables such as job function, job level, SICs, size, location, domain, and title keyword search. Advanced features include deployed technologies; email, domain, and past download suppression lists; SOHO business suppression; and maximum downloads per company, domain, or website.

Leads are ranked by quality with the option to filter leads by quality strata:

Leadporte quality strata allow users to select high-quality data specific to their primary outreach channel.
Leadporte quality strata allow users to select high-quality data specific to their primary outreach channel.

When the max records per company field is selected, LeadPorte selects records based upon job level and data quality.

Max downloads combined with suppression list functionality allow outbound call centers to pull records on an as needed basis instead of pulling bulk files which quickly begin to decay.

A data rebate is in place to encourage a positive quality feedback loop. “We were having trouble getting feedback on our data outside of our OEM channel partners.” said EMM CEO Rick Holmes. “LeadPorte connects us to the feedback of the final user of our product. With hundreds of thousands of records a week being fed back to us from top telemarketing and email firms we’re improving and adding new data in a tremendous way.”

Domain and company name downloads support ABM campaigns focused on best-fit companies. According to Holmes, “Strong ABM campaign case studies often use referral outreach to other stakeholders in the business at companies that have a good fit for your product. That’s why we want to get ‘supporting cast’ contacts we can ask for referrals to the right person in the organization who makes decisions about our product. Successful organizations lever this strategy using different messaging than to a direct prospect, generally asking for a referral to the person who handles the decision.”

Company data is sourced from several companies and combined with EMM’s own data. Content is blended at the field level subject to a vendor hierarchy. A company-level data module will be available shortly.

Administrative features include a search-only restriction, the ability to pull team saved searches, and visibility into monthly data consumption.

LeadPorte is priced on a volume basis with significant discounts for large call centers. At 2,000 records per month, contacts cost $0.15 each, but fall to $0.01 at 250,000 records per month. Additional discounts are available for annual purchases. Unused records are rolled forward on annual accounts but not monthly subscriptions.

LeadPorte volume-based pricing provides significant savings for large call centers.
LeadPorte volume-based pricing provides significant savings for large call centers.

Roadmap features include their first sales enablement connector, machine learning, and social login.

While a number of tier one SalesTech vendors have been acquired this year, it is refreshing to see some of the data vendors such as EMM, HG Data, and Oceanos step into the void with cloud-based data services for sales and marketing.

Oceanos for Salesforce (Beta)

Oceanos ListOptimizer supports quarterly batch updates to account, contact, and lead records.
Oceanos ListOptimizer supports quarterly batch updates to account, contact, and lead records.

Contact data management vendor Oceanos is working with Datarista to bring an SFDC-based contact service to the market.  The Oceanos ListOptimizer service, currently in in beta, will be generally available in Q1.  Sales Operations can run counts, perform company and contact searches, and ensure ongoing data integrity.

The service supports standard company and contact list building with running counts as variables are selected.  New execs may be added as lead records or accounts and contacts.  Duplicate checking is performed.

Batch Salesforce updates are performed quarterly.  In 2018, the updates will run every other month with contact changes updated weekly.

Oceanos offers best-in-class contact records from over a dozen vendors.  When records are deployed to customers, they are subject to real-time reverification against FreshAddress, FullContact, and Pipl.

Contact management services are purchased on a credit basis with custom pricing plans based upon volume and intended usage.

In other news, Oceanos recently inked a deal to deliver its ContactAPI to The Big Willow intent data platform. “Targeting prospects before the market even knows they exist provides our customers a first mover advantage,” said Big Willow CEO Charlie Tarzian.  “With the Oceanos ContactAPI, we provide our users targeted contacts for intent-qualified opportunities that accelerates engagement.  With 15 years in the space, they’ve earned a stellar reputation and we’re thrilled to take this next step in our partnership.”

Along with connectors and APIs, Oceanos offers free data health checks and a team of data consultants to assist with data hygiene and analytics initiatives.

The Fog of Corporate Battle

Churchill's WWII Map Room (Source: Creative Commons)
Churchill’s WWII Map Room (Source: Kaihsu Tai / Creative Commons)

Information is a key asset on the battlefield which provides a competitive advantage to the side with better information and communication systems.  While the “Fog of War” continues to be an issue, real-time information sharing helps improve military decision making and reduces the risk of both collateral damage and friendly fire accidents.  Nevertheless, information remains imperfect and mistakes continue to happen.

In the corporate world, there is also a fog of corporate battle, but much of it is self-induced.  We build systems that don’t talk to each other or which use different conventions for standardizing information and identifying customers and contacts.  Furthermore, information is not validated and enriched as it is obtained, resulting in weak information sets.

While this lack of data synchronization creates headaches across the company, I will be focusing on sales and marketing platforms for purposes of brevity.  Inaccurate and incomplete marketing information causes problems within marketing platforms such as weak segmentation, poor scoring, bad targeting, and misallocated marketing resources.  Bad and missing fields are then propagated to downstream systems.  If information is bad when received and there are no mechanisms for validating, standardizing, and enriching the information in its system of origin, misinformation flows to other platforms resulting in an increasingly expensive set of problems and remediation costs.  It is much easier and less expensive to resolve a problem at its source.

Furthermore, once leads are enriched with firmographic and biographical details, the intelligence is available to downstream platforms; and if the enrichment includes a company identifier (e.g. European Registration Number, Ticker, D-U-N-S Number), then maintaining data accuracy in downstream systems and linking the platforms is much easier.

The cost of islands of information is high for B2B firms.  A few examples:

  • Marketing departments generate a broad set of leads through multiple channels and systems.  Some of this information is anonymous and some is tied directly to contacts.  How confident are you that you aren’t generating duplicate (or triplicate or quadruplicate…) information?  Are you matching and enriching information as it is gathered from web forms, uploaded tradeshow spreadsheets, and purchased lists, or are you loading data “as is” with little verification or enhancement?  By focusing on data quality at the outset, you are ensuring that richer and more accurate information is shared across your platforms.
  • Marketing invests large sums in generating marketing qualified leads (MQL) which are then frequently ignored or cherry picked by sales.  Some of this disconnect is a lack of agreement on what constitutes a good lead but some is also a lack of front-end intelligence being applied by marketing.  A lead may be considered as marketing qualified but lack key information to pass muster with sales (e.g. how big is the company? What industry are they in? What is the job function and level of the contact? What technologies do they use? Will they be approved by credit after I’ve invested months in landing the deal?)  Knowing that a lead downloaded a whitepaper earlier in the day signifies interest in a topic, but not the ability or authority to make purchasing decisions.  Furthermore, it provides a thin reed upon which to base a sales conversation.
  • Channel conflicts are introduced when bad or missing information results in a lead being directed to the wrong sales rep.  Leads which lack accurate firmographics and linkage information are likely to be routed to the wrong team or rep.  Thus, a lead generated at a subsidiary or branch location of a major firm may be routed to a territory rep instead of a named account rep, resulting in both channel conflict and a greater likelihood that the lead will be ignored.  Of course, if the lead was poorly routed, it also is likely that the lead was improperly scored and assigned to the wrong segments for targeting and analytics.

Finally, the lack of standards and cross-platform communication make it difficult to obtain a unified view of the customer.  An October 2015 survey of global executives by Forbes Insights found that 63% believed that a more complete/unified view of the customer would result in more accurate predictions of customer needs and desires.  Other benefits included improved customer experience/service (60%), greater feedback for product/service innovation (55%), and a greater ability to target and optimize for specific customers (50%).

For decades, technology strategists have warned about the problems of creating data islands across one’s IT platforms.  If systems are unable to speak with each other or data lacks consistency across systems, then it is impossible to develop a holistic view of one’s business and customers.  And while the problem seems large today, it will only grow in scope with the advent of the Internet of Things.  So if you think the fog of corporate battle is difficult in 2017, failing to address it will only make the problem many-fold more difficult to tackle in the years to come.

RampedUp Account Scoring

RampedUp Profiles now include account based scores (zero to five stars).
RampedUp Profiles now include account based scores (zero to five stars).

Sales Intelligence vendor RampedUp added account scoring to their platform. Other new features include saved searches for leads and trigger events, lead and trigger event downloading to CSV files, importing corporate URLs into searches, and the auto-population of decision makers and preferred technologies.

The new scoring doesn’t employ predictive analytics, but rates accounts on a zero to five basis, with a star awarded for each of five conditions:

  • One of top 5 industries based on the client roster
  • One of top 5 market segments based on client employee count
  • Installed Technology based on products important to the client’s sales process
  • Contacts present with preferred title based on selected buying committee
  • Recent trigger event article showing activity over the last 90 days

“Two things that have always set RampedUp apart from other sales intelligence platforms have been the tailored nature of the data we provide,” said CEO Scott Miller. “Our customers are exposed to contacts that are unique to their buying committee. We also share look-alike customer data based on a sync that pulls customer data into our platform in near real-time. RampedUp also tracks triggering events and installed technology used by companies to help sellers understand their prospects better. All this information is used to create our unique scoring methodology.”