Radius Intelligence Merges with Leadspace

Radius graphic highlights the complementary assets of the two firms (Source: Radius Intelligence)
Radius graphic highlights the complementary assets of the two firms

On Monday, Leadspace and Radius Intelligence announced their merger.  The two firms were early entrants into the predictive analytics space, but the market for standalone predictive intelligence services has not developed as predicted.  Thus, VCs and private equity companies are sitting on large bets that have yet to pay out.

The merged company will continue under the Radius brand as the “leader in B2B data intelligence.”  Leadspace CEO Doug Bewsher will take over as the CEO of the merged firm while Radius founder Darian Shirazi will assume the role of Chairman.  The two positioned the merger as a coming together of firms with complementary assets across company (Radius) and people (Leadspace) intelligence.

“Radius and Leadspace as one company will deliver a standout go-to-market platform with the best data, artificial intelligence and integrations at its core… What’s truly exciting is that our mission remains the same. Radius will be the nucleus that powers data and intelligence across all B2B applications, channels, and users — now built on The Global Network of Record.”

  • Radius Intelligence Statement to Customers

Both Leadspace and Radius have edged closer to prospecting and data enrichment than other predictive vendors.  Leadspace has long offered contact enrichment and prospecting, even appearing in a 2015 SiriusDecisions report on Contact Data Management.  Meanwhile, Radius has built its own database of US company and contact data which it named “The Network of Record” and positioned as the “single source of truth for account data.”  The Radius database spans 18 million US companies and 25 million contacts with verified emails and direct dials.  Radius also offers digital ad targeting.

Radius is positioning itself as being at the center of B2B predictive analytics, B2B Audience Management, and B2B data management. However, several of the data solution vendors also offer advertising solutions including Infogroup and Dun & Bradstreet. (Source: Radius Intelligence)
Radius is positioning itself as being at the center of B2B predictive analytics, B2B Audience Management, and B2B data management. However, several of the data solution vendors also offer advertising solutions including Infogroup and Dun & Bradstreet. (Source: Radius Intelligence)

The new Radius will help sales and marketing teams “find the right data on the right buyers, and reach those buyers across any channel.”  Revenue teams will have access to the “industry’s most comprehensive data intelligence solution.”  Features include account and people targeting, data management, ABM execution, and integrations with Salesforce, Microsoft Dynamics, Marketo, Eloqua (Oracle Marketing), and Pardot (Salesforce).

Shirazi is positioning the company as an Einstein competitor with expanded assets to compete against Salesforce.  “We’re excited about this because it will create the largest number of customers, largest revenue base and really provide a company that is at scale in B2B data and intelligence,” said Shirazi.  “The only other major player in this space we believe is Salesforce Einstein, and we’re excited to really give them a run for their money.”

Shirazi provided the following list of planned enhancements to be rolled out over the next year:

Master Data. Master Growth

  • Extend reach and accuracy as The Network of Record unites with Leadspace’s proprietary, real-time virtual database sourcing
  • Take complete control of data governance with added data dashboard functionality
  • Enhance data matching and append for contacts, as well as lead-to-account matching features

Real Intelligence. Real Buyers

  • Strengthen targeting on individual decision makers in both the U.S. and international markets
  • Access enhanced segmentation, scoring, and insights on contacts
  • Leverage features from two effective sales intelligence tools

Scale Channels. Scale Revenue

  • Expand audience reach with the largest deterministic reach of any platform
  • Source more contacts with even higher accuracy and contactability rates
  • Connect more channels with more seamless integrations and partners 

Shirazi describes Radius as the next “backbone go-to-market platform.”  The combined assets “will enable marketing, sales, revenue ops, and customer insights teams to finally address their data gaps and conquer their targeting challenges. We will create a standout solution in a crowded, fragmented space of point-solutions where customers are forced to stitch together multiple products or change vendors every year.”

Back in 2015, Radius Intelligence had a market value of $500 million and funding of $107.6 million.  Leadspace never disclosed a valuation, but it received $59 million in funding with a $21 million Series C in December.

LinkedIn lists 100 Leadspace employees and 160 Radius employees.

The merged company has over 200 customers including Sam’s Club, Hewlett Packard, Microsoft, Comcast, MetLife, and American Express.  Both firms maintain “innovation centers” in San Francisco and Israel.



Part 2: Predictive Analytics Is Losing Steam as AI Becomes Prevalent across SalesTech & MarTech

Pitchbook Expands European Coverage

Pitchbook CRM tabs cover companies, people, deals, investors, advisors, and news.
Pitchbook CRM tabs cover companies, people, deals, investors, advisors, and news.

Company profile vendor Pitchbook added 171,000 European company profiles along with financial data and M&A transaction details to their public and private company dataset.  The new profiles cover France, UK, Germany, Benelux, Ireland, Sweden and Norway.  Pitchbook also backfilled 35,000 European companies with financial data.

“Our customers require a holistic view into global financial market activity to make informed business decisions, which is the key driver behind PitchBook’s aggressive push to increase coverage of Europe’s financial ecosystem,” said Doug Trafelet, Managing Director at PitchBook. “The new companies and financials included in this dataset expansion provides unmatched visibility into company health and industry fluctuations, which simply cannot be found elsewhere. Continuing to add and refine our coverage of the European market will remain a key priority in 2018 and beyond, especially as PitchBook asserts its presence in region, both in terms of data collection and corporate footprint.”

The Pitchbook Platform is approaching one million global companies with profiles of nearly 900,000 private companies, 80,000 public companies and 800,000 transactions. Pitchbook data is delivered via browsers, mobile, data feeds, Excel, and CRM.  The Excel plug-in supports custom charting and twenty pre-built models for comps, tear sheets, and valuation.

Pitchbook has over 2,000 clients who “use PitchBook regularly to follow and analyze the flow of capital across the entire private and public markets.”  The firm is a subsidiary of Morningstar and has over 600 employees.

The firm did not disclose whether they directly gathered the European private company data or licensed it from a third party.  However, as the expanded country coverage matches CreditSafe’s recent expansion, it is likely that CreditSafe is providing the company financials.

Pitchbook also recently added a Chrome Browser extension which allows subscribers to right-click on a company to view a company profile.

The Pitchbook Chrome Connector provides immediate access to Pitchbook company intelligence.
The Pitchbook Chrome Connector provides immediate access to Pitchbook company intelligence.

 

Ignite Technologies acquires Infer

Infer Account Based Behavior Score
Infer Account Based Behavior Score

ESW Capital completed the acquisition of predictive analytics vendor Infer and will be rolling it into Ignite Technologies. Infer offers predictive lead and account scoring. Use cases include TAM identification, segmentation, account selection, demand generation, lead scoring, opportunity scoring, and upsell/cross-sell. In a September 2016 report, Gartner said that Infer pricing starts at $30,000 and increases based on the number of models. There are also charges for net-new contacts.

This summer, ESW also acquired company intelligence vendor FirstRain and rolled it into Ignite as well.

The Ignite Prime program offers clients access to additional enterprise technology once they have signed a contract for one of the Ignite Technology solutions. For example, Infer customers would have access to additional enterprise software solutions such as First Rain, ThinkVine, and Placeable equal to the value of their Infer contracts.

“We’ve been continually impressed by Ignite throughout this acquisition process. They have a strong leadership team and the right strategy that’s in line with where the future of sales and marketing solutions are going, where there’s a need to converge multiple products into a cohesive platform to drive true, full-circle customer intelligence. We’re confident this is the platform that our amazing customers will want to build on and grow, and are excited for the Infer solutions to be a part of Ignite’s Prime Program which will help customers drive 2x ROI.”

  • Vik Singh, Infer’s CEO

Infer was founded in 2010 and is headquartered in Mountain View, California. Infer focuses on predictive solutions for the technology sector and lists AdRoll, Cloudera, New Relic, Tableau, Xactly and Zendesk as clients. As of Q3 last year, Infer reported over 140 customers. Deal size was not disclosed.

SaaS Market Valuations

Venture Capital and Private Equity firms place a higher valuation on companies with recurring revenues. In Q1, software companies with a SaaS model received multiples of seven times revenue while other software companies received a multiple of 6.1.

“Any firm with recurring revenue is extremely attractive to investors,” said Rohit Kulkarni, head of research at SharesPost. “The subscription model translates to greater visibility of revenues, less volatility.”

According to PitchBook Data, Software-as-a-Service deals grew 217% between 2010 and 2016.

“SaaS is a more predictable and reliable revenue stream than if you had to go out and sell the software — the perpetual license model,” said Peter Fair, managing director at Golub Capital LLC.

Michael Larsen of Cambridge Associates said that SaaS models provide a “better measuring stick” as “these companies are moving toward more attractive, more readily transparent ways of selling products and they have attractive, meaningfully recurring revenues.” Employing a SaaS model does not prevent firms from failing but “it creates a more intensely analytical and measurable way of determining how a company is doing.”

For example, subscription firms that employ discounted offers to lure new customers may suffer from churn and see their business model unravel quickly. Subscription length needs to be carefully factored into valuing a firm and estimating its viability.

DueDil Posted Strong 2016 Turnover Growth; Positions Itself for European Expansion

DueDil's new credit risk filter allows users to filter prospects by the degree of trade credit risk.
DueDil’s new credit risk filter allows users to filter prospects by the degree of trade credit risk.

European private company information platform DueDil recently filed its 2016 financials with Companies House. Revenue increased from £1.21M to £2.25M. The startup continues to run in deficit (£6.17M), but that should be anticipated for an information services startup that is rapidly expanding its content and functionality. DueDil averaged 75 employees last year, up from 46 in 2015.

DueDil’s losses expanded last year as it pursued the European company intelligence market which it believes is becoming more hospitable.

“In the last 12 months, our competitive landscape has changed dramatically, Bureau Van Dijk got sold for $3.3 billion to Moody’s, and Dun & Bradstreet divested its Benelux division. This, along with our much better unit economics, gave our board and management team a clear signal to grow the product and the team and start to compete directly with them. The higher costs are the result of growing our product coverage from the UK and Ireland to pan-European, soon to cover 100 million+ companies.”

  • CEO Damian Kimmelman

Because subscription services are ratable, growth in revenue lags billings. Although enterprise sales grew 100% last year, much of this growth won’t show up in the top line until 2017. DueDil had its best quarter in Q1 and then grew 60% in Q2.

“Over the last 6 months, we have grown sales 5% week over week and are continuing to do so,” said Kimmelman.

To fund growth until its next equity round, the firm recently issued a £900,000 convertible note and plans to issue a £1.1 million convertible note. “I think you can assume that we wouldn’t be so bullish on a convertible if there hadn’t been an immediate liquidity event in sight,” Kimmelman told Business Insider. “I am not trying to be coy but that is all I can say.”


In product news, DueDil added Credit Risk and Ownership filters to its list building module. Sales and Marketing can employ the credit risk filter to remove prospects that are unlikely to pass credit checks or to target higher risk companies. The filter can also be used by credit risk and procurement teams during the onboarding process allowing them to streamline the processing of low-risk companies.

Ownership search filters assist with targeting firms with concentrated shareholdings which are “ripe for takeover.”  New Ownership screens include Total Shareholding Count, Individuals Count, Companies Count, and Shareholder Name.

Along with credit scores and ownership filters, DueDil supports a broad set of financial screening filters spanning 40 million companies in the UK, Ireland, France, Germany, Benelux, Norway, and Sweden with additional European countries in queue.

DueDil added four new shareholder filters for identifying firms "ripe for takeover."
DueDil added four new shareholder filters for identifying firms “ripe for takeover.”

2016 North American Market Size

2016 North American Sales Intelligence Market Sizing Model (Excel)

The Market Size of North American Sales Intelligence Vendors. Includes vendor product features, market share, and notes. GZ Consulting Copyright 2017.

$500.00

Price Reduced ($750 ⇒ $500)

For the past few years, I have been sizing the North American Sales Intelligence Market.  This is the largest of the markets as Europe and AsiaPac are more fragmented (the UK is the only other mature market with Bureau van Dijk, Avention UK, Artesian Solutions, and DueDil offering full solutions).

In 2016, I estimated the market at $770 million with LinkedIn Sales Navigator as the top vendor.  While new firms continue to enter, the top ten firms (now eight following the 2017 acquisitions of Avention and RainKing) earn seven of every eight dollars in the industry.

I am making my market model available for license (See PayPal button at top) as an Excel spreadsheet.  It includes revenue numbers by company along with market share, key features, and notes.

The LinkedIn Market Share Section of the 2016 North American Sales Intelligence Market Sizing
The LinkedIn Market Share Section of the 2016 North American Sales Intelligence Market Sizing

I have also broken out two sub-categories: Predictive Analytics and Tech Sales Intelligence.  Predictive Analytics vendors continue to scuffle in the marketplace.  Last September, Gartner sized the global market at between $100 and $150 million.  I have gone back and forth on whether to include them in the larger sales intelligence space, but several of the sales intelligence vendors have added light predictive tools (e.g. Avention, DiscoverOrg, RainKing) while the predictive analytics companies have moved to add enrichment and provide more insights to sales reps.  As such, I see the two product categories moving towards each other so chose to include Lattice Engines, Leadspace, and similar firms.

The Tech Sales Intelligence category (e.g. DiscoverOrg, RainKing, Aberdeen, Corporate360) continues to show strong growth and makes up just over 15% of the market.  Both DiscoverOrg and RainKing have posted remarkable growth over the past few years and merged their efforts last month.  Post acquisition, they are the number three vendor in the space and may hit $120 million in 2017 revenue.  The new powerhouse has 4,000 customers and is looking to expand beyond technology sales to become a general purpose sales intelligence solution.

Acquiring RainKing should move DiscoverOrg well past Data.com (Salesforce) which will likely see declining 2017 revenue.  Salesforce has dropped the ball on Data.com.  They overpromised and under-delivered for years, relying on their ability to bundle the offering with other SFDC products.  As of last month, they are no longer able to deliver Dun & Bradstreet content (D&B WorldBase, Hoovers, and First Research) to new customers (legacy customers retain access).  Unless Data.com has a major content partner announcement at Dreamforce, it is likely to see significant revenue declines in 2017 and 2018 as customers switch to D&B Hoovers for Salesforce and other offerings.

Dun & Bradstreet re-established itself as the #2 vendor in the space with the January 2017 acquisition of Avention and the rebranding of Avention OneSource as D&B Hoovers.  Both companies have struggled to grow revenue with Avention growing slowly over the past few years and Hoovers declining.  However, infusing Avention products with Dun & Bradstreet content both reduces the underlying cost structure of Avention offerings and improves the depth and quality of the content.  Furthermore, Dun & Bradstreet has a much larger sales force which previously has lacked a credible global sales intelligence offering.  Hoovers classic generated nearly all of its revenue in the United States.  Over the next two years, expect to see significant revenue shift from Hoovers Classic to D&B Hoovers.

Three-Toed Sloth By Stefan Laube (Tauchgurke) - Public Domain.
Three-Toed Sloth By Stefan Laube (Tauchgurke) – Public Domain.

Finally, LinkedIn Sales Navigator has established itself as the clear number one vendor in market revenue.  The product didn’t exist five years ago and its competitors still tend to dismiss this gorilla in their midst.  How can they be missing the #1 vendor in the space?  Easy — the gorilla is well camouflaged and appears to be more of a three-toed sloth sleeping in the forest canopy.  Sales reps all use the freemium version of LinkedIn so give little thought to delve further when they ask “how are you obtaining your account intelligence today?” and the response is LinkedIn.  Thus, they enter LinkedIn as the competitor into their CRM, not Sales Navigator.  A few months later when they lose the opportunity, the rep then enters “no decision” into the CRM instead of recognizing a competitive loss.  I have been warning vendors in the space for years about this phenomenon, but they have failed to understand the threat of a gorilla that looks like a three-toed sloth.


N.B. Three-toed sloths inhabit Central and South America and gorillas Central Africa.  This is a metaphor.

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Unomy Acquired by WeWork

Unomy B2B Prospecting spans 6M companies and 50M contacts.
Unomy supports both B2B company and contact prospecting

I was going to address the Unomy acquisition yesterday, but DiscoverOrg acquired RainKing so Unomy was bumped to today.  This is the fourth deal in the news this week (Moody’s acquisition of Bureau van Dijk closed at the beginning of the month and Zoominfo was acquired by PE company Great Hill Partners.

The WeWork acquisition of Unomy is an out of left field deal.  WeWork has been using Unomy for the past year to assist with their sales process.  The firm is looking to integrate Unomy into its workflows to improve both close rates and pipeline velocity for their co-working offices.  WeWork views Unomy as a key dataset for expanding enterprise sales.  While the firm provides office space for companies of all sizes, they would like to expand enterprise sales beyond 30% of their monthly revenue and 20% of their membership.

“Their B2B intelligence layer will be able to help us enrich our data sets when we’re driving sales in the enterprise market,” said WeWork SVP for Digital Product Ron Gura.

For WeWork, Unomy’s platform will become the backbone of our growing internal sales platform. The Unomy software will be integrated into WeWork’s current systems and the Unomy team – now part of our Sales & Marketing and Digital Products groups – will work with our enterprise sales team to help them go to market most effectively and improve their targeting capabilities, conversion rates, and productivity. More broadly, the Unomy team will also help streamline sales processes, build robust sales intelligence infrastructure, and close member prospects for our enterprise and regional sales teams around the world.

  • Ron Gura, WeWork SVP for Digital Product

WeWork will be retaining Unomy’s staff of twenty which will operate out of a Tel Aviv office.

WeWork did not indicate whether Unomy would be available to their tenants as a free or discounted service.  WeWork offers a services store to its tenants with over forty sales and marketing partners.  Amongst the firms with partnership discounts are Salesforce, CrunchBase, and RelPro.  However, WeWork does not plan on continuing the commercial product and will phase out the Unomy service, helping to transfer clients to other sales intelligence solutions.

Unomy’s database covers 17 million global companies and over 100 million executives.