CEO Kyle Porter attributes SalesLoft’s revenue growth to a strong company culture.
SalesLoft CEO Kyle Porter announced that his sales engagement firm hit $50M in ARR while maintaining a 4.9 Glassdoor rating. 96% of employees would recommend SalesLoft to a friend, 99% approved of the CEO, and 96% had a positive business outlook.
Porter
equated SalesLoft’s success with respect for his employees:
“Our owners and exec team loves on our employees so they love on you (our customers and soon to be customers). Here’s to keeping healthy as you scale.”
Porter had been advised by a founder / CEO that maintaining such a high-level of employee respect would be increasingly difficult with growth.“I remember a slight tinge of fear when they said this because organizational health is the most important focus area for me as CEO,” said Porter. “But…this team has channeled that fear and delivered. So take that naysayers! :)”
SalesLoft is holding its Rainmaker Conference in Atlanta March 11 – 13. Coincidentally, one of their top competitors, Outreach, is holding its Unleash Conference in San Diego March 10 – 12.
TechTarget’s new Confirmed Project details are collected by their research assistants.
TechTarget added a set of Confirmed Projects to their Priority Engine service. Projects include company information, project location, project contact name, purchase criteria, and purchase details. Purchase criteria include top purchase drivers, product feature criteria, and vendors under consideration.
Purchase
details include capabilities being considered, key factors in choice of
vendor(s), deployment method, departments where the purchase will be used, and
anticipated benefits.
“The integration of Confirmed Project intelligence within the platform provides an expanded view of the Total Buying Team as well as new deal insights and angles – all in one place – to help Sales teams win more meetings, opportunities and deals. The addition of Confirmed Project data provides a much deeper layer of intelligence on project criteria, specific vendor shortlists and key purchase drivers which enriches and expands insights available within Priority Engine to give sales teams more points of entry into live deals.”
TechTarget Press Release
Confirmed
Projects are displayed alongside TechTarget intelligence including Owler
company overviews, TechTarget buying teams, DiscoverOrg contacts, and HG Data
installed technologies.
TechTarget Confirmed Projects are displayed within Salesforce Account i-frames.
Confirmed
Projects are collected by TechTarget’s “team of skilled in-house research
assistants who are responsible for calling active prospects from high-ranking
Priority Engine accounts.” Prospects exchange project intelligence in
exchange for TechTarget research.
TechTarget intelligence is accessible from “any browser and imported directly into Salesforce.”
“We saw rapid growth in the use of Priority Engine to fuel inside sales efforts in 2018 as more and more of our customers’ sales teams are using the insights we provide into prospect interests, research focus, vendor considerations, and tech installs. Using this data, leading sales teams have seen up to a 4x increase in opportunity conversion. The addition of Confirmed Projects within Priority Engine will fuel this growth even more.”
TechTarget SVP of Products Andrew Briney
Priority Engine raised revenues 29% in Q4 year-over-year and “bookings remain strong.” The firm signed an additional 32 customers in Q4 and the firm raised Priority Engine prices by 10% in January 2019 after raising them 20% in January 2018. The price increase was across all Priority Engine solutions. As price increases are recognized over the life of contracts and renewals are overweighted to Q4, much of the 2018 price increase will show up in 2019 revenues.
“People that
signed up prior to the beginning of the year were protected in their previous
year’s pricing, but then we added other add-on bundles and solutions,
because…we are integrating a lot of our branding lead generation offers into
Priority Engine,” said CEO Mike Cotoia. “So there is an up-sell
capability and opportunity for our customers to…create a greater share of voice
percentage within the markets they care about.”
“Our customers continue to increase their commitment to becoming data-driven sales and marketing organizations. This is creating opportunities to strengthen our partnerships with our customers by further embedding our purchase intent data into their systems to make their sales and marketing efforts more intelligent, competitive and efficient.”
TechTarget Shareholders Letter, February 6, 2019
TechTarget admitted that the data subscription business differs significantly from their traditional quarterly marketing campaigns. Over the past two years, they have learned that service requirements vary greatly by size. Larger firms “who have sophisticated systems and ample resources” can immediately leverage intent data for awareness campaigns and fueling sales outreach. Enterprise accounts have revenue renewal rates “well over 100%.” However, smaller firms require more handholding and renew at less than 100% of revenue. To assist SMBs, TechTarget has assembled a unified customer success team to offer post-sales service and support. “We believe over time that this will increase our revenue renewal rates with this customer segment. “
TechTarget described a strong IT spending environment with multiple catalysts for growth: AI, security, data analytics, and cloud migrations. In the US, accelerated depreciation of capital expenses through 2022 gives “companies a short window to invest in technology with favorable tax treatment.”
DiscoverOrg continued its blistering growth. It acquired RainKing at the end of August 2017 so only four months ($13 million est.) of RainKing revenue was included in DiscoverOrg’s 2017 revenue. Another $26 million (est.) will show up in DiscoverOrg’s 2018 revenue. The CAGR and revenue data was sourced from the 2014 through 2018 Inc. 5000 lists.
DiscoverOrg made the Inc 5000 list for the eighth straight year with three-year revenue growth of 184%. The revenue was boosted by the acquisition of RainKing last August, but the firm would have made the list even without the acquisition. Over the past six years, DiscoverOrg posted a compound average growth rate (CAGR) of 60%, growing revenue from $5.5 million in 2011 to $91.9 million in 2017.
“For 10 years, our singular focus has been on how to fuel our customers’ pipeline and revenue growth with the best B2B data available anywhere,” said Henry Schuck, DiscoverOrg CEO. “Being named to the Inc. 5000 list for the eighth consecutive year–and especially at the size and scale we are now–demonstrates our continued unwillingness to settle for anything less than excellence.”
Last year, DiscoverOrg more than doubled its database and increased its headcount by 50%. DiscoverOrg’s Annualized Recurring Revenue (ARR) was over $130 million at the end of the year, indicating the firm was in a strong position to make the list again in 2019. DiscoverOrg only recognized around $13 million in 2017 RainKing revenue over the final four months, so approximately $26 million in additional subscription revenue will hit their books in 2018.
2017 organic revenue growth was around $19 million.
“Out of the nearly seven million private companies moving the economy forward every day, only a tiny fraction have demonstrated such remarkably consistent high growth. DiscoverOrg’s eighth Inc. 5000 honor truly puts the organization in rarefied company.”
James Ledbetter, Inc. Editor-in-chief
What is even more impressive is that DiscoverOrg passed InsideView and Avention (now D&B Hoovers) in revenue with a service that focused on the technology space while the broader sales and marketing intelligence services target the technology space, business services, professional services, and financial services.
A broad set of CRM, MAP, Sales Engagement, and Browser connectors.
“Great data is magic,” tweeted the firm.
Or course, DiscoverOrg wasn’t the only B2B Sales Intelligence, Sales Engagement, or DaaS company to make the list. I will cover Zoominfo, SalesLoft, and these other firms tomorrow.
TechTarget, which offers both IT media sites and technology sales and marketing intelligence, posted $31.5 million in Q2 earnings, up 18% year-over-year. Growth was driven by their Priority Engine Technology Sales Intelligence service which grew revenues 60% year-over-year. The firm noted that “revenue growth continues to be driven by our leadership position in purchase intent data and our customers’ transition to becoming data driven sales and marketing organizations.”
IT Deal Alerts revenue was up 21% to $14 million as the customer base grew from 500 to 600 clients. The firm also signed more than 40 new Priority Engine clients in the quarter (to approximately 250).
The new Priority Engine enhancements, which were released in early May, have been “well received in the market place.” New features included improvements to the user experience, a new Salesforce widget, persistent URLs, list assignments, user roles, and improved topic filtering.
Furthermore, Priority Engine is shifting the firm to a recurring revenue model with 34% of revenue now attributable to longer-term contracts. Approximately 80% of subscription revenue comes from medium and large firms and 20% from smaller firms, “typically VC-backed start-ups.” The revenue renewal rate for medium and large customers is “well over 100%,” said the firm in its earnings press release. “Those customers are finding great value in our purchase intent data and are renewing and buying more from us at high rates.”
However, TechTarget has a higher churn rate on smaller customers due to common issues inherent to smaller firms such as “changing go-to-market priorities, budget or funding reductions, personnel turnover, etc.” The issue of small customer churn exists for both their core services and longer-term contracts. To reduce churn, the firm is taking three steps: improving the ease of use of products; expanding their Customer Success team which owns customer on-boarding, training and monitoring; and building a dedicated sales team responsible for renewing and upselling. Splitting sales into hunters and farmers will allow the “existing sales team to hunt for new opportunities.”
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.”
Salesforce Maintained its growth trajectory in Q4 2018 (Source: Saleforce.com).
Salesforce announced another “beat and raise” quarter last week with strong revenue growth across all of its clouds and regions. Their Q4 earnings hit $2.85 billion, up 24% year-over-year (21% in constant currency). For the full year, revenues rose 25% (24% in constant currency) to $10.48 billion. SFDC has a three-year compound average growth rate (CAGR) of 25% with revenue nearly doubling over the period. Growth has been so rapid that their Q4 2018 revenue was more than their full FY 2014.
Salesforce claims it was the fastest enterprise software company to reach $10 billion in revenue and will be the fastest to hit $20 billion.
CEO Marc Benioff attributed ongoing growth to a number of factors including its sales team which drove a “blowout quarter,” lauding the “performance of that organization and their acuity.” Other factors included a growing set of CEO-level relationships, an “incredible increase in investment activity” fueled by the recent US corporate tax cuts, and digital transformation:
It doesn’t matter if they’re a consumer product goods company CEO or financial services or retail or any industry or any geography. Every CEO is thinking about their digital transformation. And I think you and I know that every digital transformation begins and ends with the customer.
This is very powerful. And it’s why we have so much activity in our company. Of course, we’re the number one customer company in the world. No other company in the history of the software industry has been as focused on customer-relationship management, but how companies can have a customer transformation at Salesforce.
And this, and this alone, focus, has accelerated our growth. You can see that in the numbers. So certainly, how we finished our year in fiscal year 2018 is not where we thought we would start. We raised guidance I think almost in each and every quarter, and yet we still ended up above that. And that’s why we’ve raised again here $150 million. This is the most we’ve ever raised in the history of the company, because we’re just ahead of where we thought we would be
So, we are, obviously $10 billion is now behind us, and $20 billion is ahead of us. And it’s our dream, we’re going to be the fastest to $20 billion.
But when you have $20 billion already on and off the balance sheet, you know that that is – we’re a huge step on the way there. So that’s what I couldn’t be more excited about the position the company is in, its competitiveness, its ability to perform, the quality of its customer relationships, the quality of the products, the integration of the acquisitions, the culture, Fortune number 1 best place to work. All of these things have come together in just a really beautiful way, and I’m extremely grateful.
Salesforce has several other factors fueling its growth: The annual Dreamforce event drew 170,000 attendees last year, the firm has a clear social mission that resonates well with millennial employees (and now decision-makers), and it was an early mover into cloud computing, mobile-first design, IoT, partner ecosystems (AppExchange), and artificial intelligence.
Finally, being cloud-only, the firm does not have to fight a rear-guard action to retain enterprise clients as they migrate to the cloud. So while SAP and Oracle must fight to retain their customer base as companies make the leap to the cloud, Salesforce is there to poach their new clients.
