SalesLoft $50M Series C

SalesLoft supports email templates and cadences for managing multi-channel communications.
SalesLoft supports email templates and cadences for managing multi-channel communications.

Atlanta sales engagement vendor SalesLoft received $50 million in Series C funding this week, bringing their total funding to $75 million. Insight Venture Partners led the round and was joined by Emergence Capital, which had participated in previous rounds, and LinkedIn. Funds will be deployed to add another 200 employees in Atlanta, San Francisco, New York, and Europe.

While the market value was not disclosed, the Atlanta Business Chronicle reported the valuation at more that $200 million.

“Things have gotten very noisy for buyers these days. They are bombarded with sales activity via phone, email, social, and many other channels,” said CEO Kyle Porter. “When buyers are able to peel away from those distractions, they still have problems to solve — and an overwhelming range of solutions to sift through. Now more than ever, buyers really need sellers who can rise above all this noise and provide them with a better sales experience — through our product innovation and our people, it’s our mission to help sellers do just that.”

SalesLoft will soon be releasing its SalesLoft Assist artificial intelligence module “which is informed by more than 500 million sales interactions, providing users with dynamic and real-time suggestions.” The firm is also looking to expand its development and partner network.  The recently launched app partner directory already supports thirty partner solutions.

“SalesLoft is one of the most innovative companies in the sales engagement category and a leading provider on the Sales Navigator Application Platform.  SalesLoft has integrated Sales Navigator into their application in a way that provides great user value while protecting LinkedIn member data. We look forward to working with SalesLoft to create even more value for our joint customers in the future.”

  • Doug Camplejohn, VP of Product, Sales Solutions, LinkedIn

“We didn’t create the sales engagement category; our customers did,” noted Porter. “They weren’t satisfied with the tools their teams had to connect and engage buyers. They made their needs clear, and we listened. As a result, sales engagement has evolved from a point solution to the system of record for sales organizations. Users are spending more time within SalesLoft than any other technology, including their CRM. Our customers are leading the way in this exciting new category, which is really just a reflection of their efforts to serve their customers in new, authentic ways.

DiscoverOrg Backed By The Carlyle Group

DiscoverOrg has rolled out a broad set of partner integrations for CRMs, MAPs, Sales Development (ABSD) platforms, and Applicant Tracking Systems.
DiscoverOrg has rolled out a broad set of partner integrations for CRMs, MAPs, Sales Development (ABSD) platforms, and Applicant Tracking Systems.

The Carlyle Group, a global alternative asset manager, has taken a minority investment stake in DiscoverOrg.  22C also participated in the round.  TA Associates maintains a “significant equity stake” in the sales and marketing intelligence company with TA Associates and executive management retaining majority control.

“The DiscoverOrg team has built the industry-leading intelligence platform for sales and marketing teams across the globe.  Consistent revenue generation requires accurate and actionable data, and that is what DiscoverOrg delivers. We are delighted to partner with the management team to accelerate growth and foster innovation.”

  • Patrick McCarter, Co-Head of U.S. Buyout Technology, Media & Telecom and Managing Director, The Carlyle Group

Randall Winn, 22C Capital Managing Member and former CEO of Capital IQ, noted, “We are exceptionally pleased to have been involved in DiscoverOrg’s success over the last few years as the team has built a truly unique data platform and developed into a world-class company. We are excited to be in a position to continue to work with DiscoverOrg and invest in [CEO] Henry [Schuck]’s vision.”

Funds will be used to accelerate database growth and the pace of product innovation.  The money is non-restricted in its purpose “other than capturing our market opportunity more quickly,” said Chief Growth Officer Katie Bullard.

DiscoverOrg is coming off of another strong year of growth in revenue (ARR above $130 million), database coverage (124% increase in contacts), and employment (50% growth and the acquisition of RainKing).  The firm has grown to 470 employees with 35 job postings on their website.  According to Bullard, the firm is on pace to hit $160 million in revenue this year.

While Schuck has previously discussed an IPO, there have been “no specific conversations” concerning going public since, said Bullard.

Terms of the investment and market valuation were not disclosed.

Leadspace: Series C, AI, and ABM

LeadSpace Use Cases
LeadSpace Use Cases

Predictive Analytics and Audience Management vendor Leadspace completed its Series C.  The funding round was led by Arrowroot Capital and joined by JVP.  The $21 million round will be used “to grow our customer team in San Francisco and Denver, and our AI and data management product teams in Israel.”

The firm is assessing additional locations, including possible offices on the East Coast and Europe, “perhaps” London.

Arrowroot has taken a seat on Leadspace’s Board.  The firm wanted growth equity advisors instead of traditional VCs for Round C.  “At this point the investment is not just in the idea and the team, but also the underlying metrics and performance of the business,” said CEO Doug Bewsher.  “Once you have “Product/Market fit”, the kinds of questions investors ask are whether you are ready to scale; what are the opportunities for further growth; and apart from additional investment can we be an investment partner that can help you address these opportunities?”

Bewsher noted that marketing has been transformed over the past seven years since Leadspace was founded.  Firms are switching from tactical demand generation programs to targeted Account Based Marketing (ABM) communications.  “No longer is it OK to just send out blanket “nurture” emails to everyone and hope that will generate positive customer engagements. No longer can you rely on a single data source as the basis to know your customer. No longer is it enough for marketers to just think of leads — they need to market to accounts, and teams of people. Neither can marketers afford to ignore intelligence and information from external parties, and simply rely on the limited info they gather internally.”

Not only has the nature of B2B marketing been transformed, but “world class B2B sales and marketing organizations” need to become more like consumer companies with a deep understanding of the account at multiple levels.  Echoing Sirius Decisions, Bewsher said that B2B marketers need to “really know your customer at the account, demand unit and individual level, and then target and personalize your messaging to cut through the noise. And think customer-first.”

As an analytics company, Bewsher talks up the value of AI for sales and marketing as it begins to address specific problems and workflows:

AI is everywhere. While there is no doubt that it is going to change every corner of our life, both as private users and business people, I think we will start to move from the promise to the reality in 2018. In business-to-business sales and marketing in 2017, it was enough to say: “We have a ton of great data scientists who are working on new ways to better engage your customers.”

But in 2018 customers will look to see actual results — like the 90 percent increase in email connection rates we have seen from the deployment of AI to recommend the right way to engage a specific user. This will require a maniacal focus on specific use cases from the emerging area of AI.

One area where AI will improve revenue generation effectiveness is in ABM programs which has been limited by the human ability to consume information and the historical lack of data availability.  However, “AI is changing all this, with the ability to consume and understand unprecedented amounts of information and turn this into action at scale and in real time. So sales and marketing teams now have the opportunity to drive much more relevant and effective engagement programs for their entire potential target audience.”

According to Leadspace, they are trusted by over 130 B2B brands and seven of the top ten enterprise software companies.  Clients include Microsoft, Marketo, Oracle, and RingCentral.

 

Artesian: £3.5M in Expansion Capital to Focus on A.I.

Arti responds to "How many companies do you cover?"
Arti responds to “How many companies do you cover?”

British sales intelligence vendor Artesian Solutions announced that it received £3.5M in expansion capital from Columbia Lake partners. The funds will be used to refinance current debt obligations and provide working capital for “further growth and expansion.” The refinancing also provides better terms and business flexibility after the firm reached a profitability milestone in July.

Artesian has begun integrating artificial intelligence into its tools. Earlier this year, it launched Insight Agent, “the first step in a series of intelligent chat bots aimed at automating many of the tasks carried out by B2B professionals” along with Arti, the firm’s interactive digital assistant.

“This is an exciting milestone in our company’s history and positively reinforces the leadership position we have attained.  We are constantly looking at the ‘what next’ scenario, pushing boundaries to establish our business as one of the leading innovators in B2B software for commercial teams, this has paved the way for our new risk mitigation capabilities which will be released in the New Year.”

  • Artesian Solutions CEO Andrew Yates

The firm has recently shifted its positioning from social selling to “A.I. powered sales intelligence.”

“Social Selling sits at the heart of Artesian’s founding principles,” explained Yates. “But as sales best practice has evolved, so has Artesian. Our goal is to be at the forefront of technology evolution for enterprise B2B, delivering a suite of A.I.-powered tools to make prospecting, engaging and closing deals easier. As our forthcoming risk mitigation capabilities demonstrate, we will continue to evolve to ensure we remain a trusted partner of our enterprise customers and to maximise the impact of their business relationships”

Artesian offers products for both the British and American markets.

 

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.

Synthio Series B

Synthio Use Cases
Synthio Use Cases

Synthio, formerly known as Social123, closed on a $10.5 million equity round to expand its Customer Data Platform.  The Series B round was led by Fulcrum Equity partners, bringing its total funding to $18.5 million.  Other participants included current investors Vocap Investment Partners, Spinnaker VC Direct, LLC,  Bahns Stanley, Stanley Partners, Ellis Capital, Buckhead Investments, the AIM Group, and Silicon Valley Bank.  The round valued the firm at $33.5 million.

Synthio will be dedicating the funds towards platform and product enhancements along with “significantly” expanding their sales, marketing, and customer success teams.

Synthio is perfectly positioned to become the must-have solution for business-to-business enterprise marketers tasked with managing complex and rapidly changing customer data.  The new funding allows us to continue investing in our unique ability to synthesize 1st and 3rd party data into the highest quality contact, firmographic, and technographic profiles.  Our contact-centric approach to customer data is unique in the market and is an indispensable solution designed to address the major pain points hampering marketers’ productivity and performance.

  •  Synthio CEO Aaron Biddar

Synthio emphasized the need for high quality data to fuel Marketing Automation Platforms and ABM campaigns.

“High quality leads and prospects are the mined gold on which companies spend fortunes and today’s marketers and sales professionals require that this data be in pristine condition,” said Jim Douglas, Partner at Fulcrum.

Synthio has over 200 active subscription customers and made the last two Inc. 5000 lists.  According to Inc., the firm posted $2.8 million in revenue in 2015 with a 123% three-year Compound Average Growth Rate.  The firm claims to have doubled their revenue in both 2015 and 2016.

Outreach: $30 Million for Empowering Sales Reps

Outreach Workflow Intelligence combines Outreach prospect and process analytics with third-party company and contact information.
Outreach workflow intelligence combines Outreach prospect and process analytics with third-party company and contact information.

Account Based Sales Development (ABSD) vendor Outreach announced a $30 million Series C round led by DJF.  With the capital injection, Outreach raised its total funding to $60 million.  The valuation was not disclosed.  Other round participants included Four Rivers Group and existing investors Mayfield, MHS Capital, Microsoft Ventures and Trinity Ventures.  Funds will be deployed towards additional product development, staffing, and marketing.

“The future of selling will be machines helping sales reps by removing the barriers of what bogs them down and empowering them to do their best work,” blogged Outreach CEO Manny Medina.  “This round gives us the ability to make the required investments in machine learning and natural language processing. We’re doubling down in an area many in the market are talking about, but have yet to make a reality. With this investment, Outreach will continue to innovate to improve the day-to-day life of sales reps and their impact on the companies and communities they serve.”

Outreach helps automate, track, and analyze sales rep tasks across multiple communication channels including email, phone, and LinkedIn.  Activities are tracked and synchronized with Salesforce, Gmail, and Exchange.  Outreach supports over 1,200 sales teams including sales organizations at Adobe, Pandora, eBay, Marketo, and Zillow.  The firm supports the efforts of over 15,000 sales reps.

Like many industries, technology is transforming sales from an art to a science.  Sales is no longer about following up on inbound leads and hunting for a few big deals. It is about sales excellence – predictably executing the right selling activities at the right time.

  • Outreach CEO Manny Medina

The firm, founded in 2014, doubled its employment over the past year to 170.  Outreach is looking to grow its product and engineering group from thirty to fifty staff before the end of 2017.  Outreach is based in Seattle with offices in San Francisco and State College, PA.  They recently opened an office in Tampa, Florida which has hired some of the talent from recently shuttered competitor KiteDesk.

While I have not heard the specific rationale behind the KiteDesk shutdown, a former CxO at the firm suggested that they lacked the capital to compete against well-funded competitors such as Outreach and SalesLoft.

Along with the funding round, Outreach announced that DFJ Growth Partner Sam Fort has been added to Outreach’s Board. “The opportunity for a platform that simplifies and automates the sales process is massive and we are thrilled to have Outreach join our portfolio,” said Fort.