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Sales scheduling platform Chili Piper raises $33M Series B funding led by Tiger Global
Chili Piper, which has a sophisticated SaaS appointment scheduling platform for sales teams, has raised a $33 million B round led by Tiger Global. Existing investors Base10 Partners and Gradient Ventures (Google’s AI-focused VC) also participated. This brings the company’s total financing to $54 million. The company will use the capital raised to accelerate product development. The previous $18 million A round was led by Base10 and Google’s Gradient Ventures nine months ago.
It’s main competitor is Calendly, started 2 1/2 years previously, which recently achieved a $3 billion valuation.
Launched in 2016, Chili Piper’s software for B2B revenue teams is designed to convert leads into attended meetings. Sales teams can also use it to book demos, increase inbound conversion rates, eliminate manual lead routing and streamline critical processes around meetings. It’s used by Intuit, Twilio, Forrester, Spotify and Gong.
Chili Piper has a number of different tools for businesses to schedule and calendar accountments, but its key USP is in its use by “inbound SDR Sales Development Representatives (SDR)”, who are responsible for qualifying inbound sales leads. It’s particularly useful in scheduling calls when customers hit websites and ask for a salesperson to call them back.
Nicolas Vandenberghe, CEO, and co-founder of Chili Piper said: “When we started we sold the house and decided to grow the company ourselves. So all the way until 2019 we bootstrapped. Tiger gave us a valuation that we expected to get at the end of this year, which will help us accelerate things much faster, so we couldn’t refuse it.”
Alina Vandenberghe, CPO and co-founder said: “We’re proud to have so many customers scheduling meetings and optimizing their calendars with Chili Piper’s Instant Booker.”
The husband-and-wife-founded company was fully remote from day one, with 93 employees in 81 cities and 21 countries, long before the pandemic hit.
John Curtius, partner at Tiger Global said: “When we met Nicolas and Alina, we were fired up by their product vision and focus on customer happiness.”
TJ Nahigian, managing partner at Base10 Partners, added: “We originally invested in Chili Piper because we knew customers needed ways to add fire to how they connected with inbound leads. We’ve been absolutely blown away with the progress over the past year, 2020 has been a step-change for this company as business went remote.”
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Saltbox raises $10.6M to help booming e-commerce stores store their goods
E-commerce is booming, but among the biggest challenges for entrepreneurs of online businesses are finding a place to store the items they are selling and dealing with the logistics of operating.
Tyler Scriven, Maxwell Bonnie and Paul D’Arrigo co-founded Saltbox in an effort to solve that problem.
The trio came up with a unique “co-warehousing” model that provides space for small businesses and e-commerce merchants to operate as well as store and ship goods, all under one roof. Beyond the physical offering, Saltbox offers integrated logistics services as well as amenities such as the rental of equipment and packing stations and access to items such as forklifts. There are no leases and tenants have the flexibility to scale up or down based on their needs.
“We’re in that sweet spot between co-working and raw warehouse space,” said CEO Scriven, a former Palantir executive and Techstars managing director.
Saltbox opened its first facility — a 27,000-square-foot location — in its home base of Atlanta in late 2019, filling it within two months. It recently opened its second facility, a 66,000-square-foot location, in the Dallas-Fort Worth area that is currently about 40% occupied. The company plans to end 2021 with eight locations, in particular eyeing the Denver, Seattle and Los Angeles markets. Saltbox has locations slated to come online as large as 110,000 square feet, according to Scriven.
The startup was founded on the premise that the need for “co-warehousing and SMB-centric logistics enablement solutions” has become a major problem for many new businesses that rely on online retail platforms to sell their goods, noted Scriven. Many of those companies are limited to self-storage and mini-warehouse facilities for storing their inventory, which can be expensive and inconvenient.
Scriven personally met with challenges when starting his own e-commerce business, True Glory Brands, a retailer of multicultural hair and beauty products.
“We became aware of the lack of physical workspace for SMBs engaged in commerce,” Scriven told TechCrunch. “If you are in the market looking for 10,000 square feet of industrial warehouse space, you are effectively pushed to the fringes of the real estate ecosystem and then the entrepreneurial ecosystem at large. This is costing companies in significant but untold ways.”
Now, Saltbox has completed a $10.6 million Series A round of financing led by Palo Alto-based Playground Global that included participation from XYZ Venture Capital and proptech-focused Wilshire Lane Partners in addition to existing backers Village Global and MetaProp. The company plans to use its new capital primarily to expand into new markets.
The company’s customers are typically SMB e-commerce merchants “generating anywhere from $50,000 to $10 million a year in revenue,” according to Scriven.
He emphasizes that the company’s value prop is “quite different” from a traditional flex office/co-working space.
“Our members are reliant upon us to support critical workflows,” Scriven said.
Besides e-commerce occupants, many service-based businesses are users of Saltbox’s offering, he said, such as those providing janitorial services or that need space for physical equipment. The company offers all-inclusive pricing models that include access to loading docks and a photography studio, for example, in addition to utilities and Wi-Fi.
Image Credits: Saltbox
Image Credits: Saltbox
The company secures its properties with a mix of buying and leasing by partnering with institutional real estate investors.
“These partners are acquiring assets and in most cases, are funding the entirety of capital improvements by entering into management or revenue share agreements to operate those properties,” Scriven said. He said the model is intentionally different from that of “notable flex space operators.”
“We have obviously followed those stories very closely and done our best to learn from their experiences,” he added.
Investor Adam Demuyakor, co-founder and managing partner of Wilshire Lane Partners, said his firm was impressed with the company’s ability to “structure excellent real estate deals” to help them continue to expand nationally.
He also believes Saltbox is “extremely well-positioned to help power and enable the next generation of great direct to consumer brands.”
Playground Global General Partner Laurie Yoler said the startup provides a “purpose-built alternative” for small businesses that have been fulfilling orders out of garages and self-storage units.
Saltbox recently hired Zubin Canteenwalla to serve as its chief operating officer. He joined Saltbox from Industrious, an operator co-working spaces, where he was SVP of Real Estate. Prior to Industrious, he was EVP of Operations at Common, a flexible residential living brand, where he led the property management and community engagement teams.
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How our SaaS startup improved net revenue retention by more than 30 points in two quarters
There’s certainly no shortage of SaaS performance metrics leaders focus on. While all SaaS companies do, and must, home in on acquisition metrics, there’s also massive revenue potential within your current customer base.
I think NRR (net revenue retention) is without question the most underrated metric out there. NRR is simply total revenue minus any revenue churn plus any revenue expansion from upgrades, cross-sells or upsells. The greater the NRR, the quicker companies can scale. Simply put: the power of compound math!
One of the biggest and most impactful changes we made was to move new business, retention and account management all under our chief revenue officer.
Over the course of two quarters, Terminus grew its NRR by more than 30 points, opening up incredible new levels of growth opportunities.
To boost our NRR for the better, I focused on three core pillars within our organization.
People
We took a holistic look at the organization and our org structure. One of the biggest and most impactful changes we made was to move new business, retention and account management all under our chief revenue officer. At the end of the day, it just makes a ton of sense to have acquisition and retention living under the same roof — why bother acquiring new customers if you can’t retain them?
We also rolled out a surround-sound team (around three or four people per customer) who onboard and help customers with their account from day one. In total, we have about a quarter of our company dedicated to this 24/7 support and hands-on guidance to ensure we’re enabling customers immediately.
Process
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Argentina’s Digital House raises over $50M to help solve LatAm’s tech talent shortage
Digital House, a Buenos Aires-based edtech focused on developing tech talent through immersive remote courses, announced today it has raised more than $50 million in new funding.
Notably, two of the main investors are not venture capital firms but instead are two large tech companies: Latin American e-commerce giant Mercado Libre and San Francisco-based software developer Globant. Riverwood Capital, a Menlo Park-based private equity firm, and existing backer early-stage Latin American venture firm Kaszek also participated in the financing.
The raise brings Digital House’s total funding raised to more than $80 million since its 2016 inception. The Rise Fund led a $20 million Series B for Digital House in December 2017, marking the San Francisco-based firm’s investment in Latin America.
Nelson Duboscq, CEO and co-founder of Digital House, said that accelerating demand for tech talent in Latin America has fueled demand for the startup’s online courses. Since it first launched its classes in March 2016, the company has seen a 118% CAGR in revenues and a 145% CAGR in students. The 350-person company expects “and is on track” to be profitable this year, according to Duboscq.
Digital House CEO and co-founder Nelson Duboscq. Image Credits: Digital House
In 2020, 28,000 students across Latin America used its platform. The company projects that more than 43,000 will take courses via its platform in 2021. Fifty percent of its business comes out of Brazil, 30% from Argentina and the remaining 20% in the rest of Latin America.
Specifically, Digital House offers courses aimed at teaching “the most in-demand digital skills” to people who either want to work in the digital industry or for companies that need to train their employees on digital skills. Emphasizing practice, Digital House offers courses — that range from six months to two years — teaching skills such as web and mobile development, data analytics, user experience design, digital marketing and product development.
The courses are fully accessible online and combine live online classes led by in-house professors, with content delivered through Digital House’s platform via videos, quizzes and exercises “that can be consumed at any time.”
Digital House also links its graduates to company jobs, claiming an employability rate of over 95%.
Looking ahead, Digital House says it will use its new capital toward continuing to evolve its digital training platforms, as well as launching a two-year tech training program — dubbed the the “Certified Tech Developer” initiative — jointly designed with Mercado Libre and Globant. The program aims to train thousands of students through full-time two-year courses and connect them with tech companies globally.
Specifically, the company says it will also continue to expand its portfolio of careers beyond software development and include specialization in e-commerce, digital marketing, data science and cybersecurity. Digital House also plans to expand its partnerships with technology employers and companies in Brazil and the rest of Latin America. It also is planning some “strategic M&A,” according to Duboscq.
Francisco Alvarez-Demalde, co-founder & co-managing partner of Riverwood Capital, noted that his firm has observed an accelerating digitization of the economy across all sectors in Latin America, which naturally creates demand for tech-savvy talent. (Riverwood has an office in São Paulo).
For example, in addition to web developers, there’s been increased demand for data scientists, digital marketing and cybersecurity specialists.
“In Brazil alone, over 70,000 new IT professionals are needed each year and only about 45,000 are trained annually,” Alvarez-Demalde said. “As a result of such a talent crunch, salaries for IT professionals in the region increased 20% to 30% last year. In this context, Digital House has a large opportunity ahead of them and is positioned strategically as the gatekeeper of new digital talent in Latin America, preparing workers for the jobs of the future.”
André Chaves, senior VP of Strategy at Mercado Libre, said the company saw in Digital House a track record of “understanding closely” what Mercado Libre and other tech companies need.
“They move as fast as we do and adapt quickly to what the job market needs,” he said. “A very important asset for us is their presence and understanding of Latin America, its risks and entrepreneurial environment. Global players have succeeded for many years in our region. But things are shifting gradually, and local knowledge of risks and opportunities can make a great difference.”
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Following acquisition, Episerver rebrands as Optimizely
After acquiring Optimizely last fall, content management company Episerver is adopting the Optimizely name for the entire organization.
CEO Alex Atzberger told me that the company will be rolling out new branding in the next coming months, as well as renaming its entire product suite to reflect the Optimizely brand.
“We believe it’s no longer just about personalizing the experience or driving recommendations,” Atzberger said. “The brand and word Optimizely really signifies optimal performance. Companies today of any size, any scale [need to be] much more sophisticated in terms of how they digitally connect with their customers. It’s a never-ending story.”
At the same time, he emphasized that Episerver is making the change from “a position of strength,” with the combined company seeing double-digit revenue growth last year and going live with more than 250 new customers.
Asked whether adopting the Optimizely name was always part of the post-acquisition plan, Atzberger replied, “When we acquired Optimizely, we knew that we would be acquiring not just a great product, not just a great customer base, but also acquiring a very well-known brand. We had not yet decided on [rebranding], but it was certainly something that, for me, was part of the consideration.”
In addition to announcing the new company name, Episerver/Optimizely is also announcing a new platform that it’s calling Optimization-as-a-Service, which integrates aspects of Optimizely and Episerver products to offer web targeting, testing and recommendations. As Atzberger put it, this new platform allows customers to determine “who to show something to, what content to show and how to actually show this content.”
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End-to-end operators are the next generation of consumer business
At Battery, a central part of our consumer investing practice involves tracking the evolution of where and how consumers find and purchase goods and services. From our annual Battery Marketplace Index, we’ve seen seismic shifts in how consumer purchasing behavior has changed over the years, starting with the move to the web and, more recently, to mobile and on-demand via smartphones.
The evolution looks like this in a nutshell: In the early days, listing sites like Craigslist, Angie’s List* and Yelp effectively put the Yellow Pages online — you could find a new restaurant or plumber on the web, but the process of contacting them was largely still offline. As consumers grew more comfortable with the web, marketplaces like eBay, Etsy, Expedia and Wayfair* emerged, enabling historically offline transactions to occur online.
More recently, and spurred in large part by mobile, on-demand use cases, managed marketplaces like Uber, DoorDash, Instacart and StockX* have taken online consumer purchasing a step further. They play a greater role in the operations of the marketplace, from automatically matching demand with supply, to verifying the supply side for quality, to dynamic pricing.
The key purpose of being end-to-end is to deliver an even better value proposition to consumers relative to incumbent alternatives.
Each stage of this evolution unlocked billions of dollars in value, and many of the names listed above remain the largest consumer internet companies today.
At their core, these companies are facilitators, matching consumer demand with existing supply of a product or service. While there is no doubt these companies play a hugely valuable role in our lives, we increasingly believe that simply facilitating a transaction or service isn’t enough. Particularly in industries where supply is scarce, or in old-guard industries where innovation in the underlying product or service is slow, a digitized marketplace — even when managed — can produce underwhelming experiences for consumers.
In these instances, starting from the ground up is what is really required to deliver an optimal consumer experience. Back in 2014, Chris Dixon wrote a bit about this phenomenon in his post on “Full stack startups.” Fast forward several years, and more startups than ever are “full stack” or as we call it, “end-to-end operators.”
These businesses are fundamentally reimagining their product experience by owning the entire value chain, from end to end, thereby creating a step-functionally better experience for consumers. Owning more in the stack of operations gives these companies better control over quality, customer service, delivery, pricing and more — which gives consumers a better, faster and cheaper experience.
It’s worth noting that these end-to-end models typically require more capital to reach scale, as greater upfront investment is necessary to get them off the ground than other, more narrowly focused marketplaces. But in our experience, the additional capital required is often outweighed by the value captured from owning the entire experience.
End-to-end operators span many verticals
Many of these businesses have reached meaningful scale across industries:
Image Credits: Battery Ventures (opens in a new window)
All of these companies have recognized they can deliver more value to consumers by “owning” every aspect of the underlying product or service — from the bike to the workout content in Peloton’s case, or the bank account to the credit card in Chime’s case. They have reinvented and reimagined the entire consumer experience, from end to end.
What does success for end-to-end operator businesses look like?
As investors, we’ve had the privilege of meeting with many of these next-generation end-to-end operators over the years and found that those with the greatest success tend to exhibit the five key elements below:
1. Going after very large markets
The end-to-end approach makes the most sense when disrupting very large markets. In the graphic above, notice that most of these companies play in the largest, but notoriously archaic industries like banking, insurance, real estate, healthcare, etc. Incumbents in these industries are very large and entrenched, but they are legacy players, making them slow to adopt new technology. For the most part, they have failed to meet the needs of our digital-native, mobile-savvy generation and their experiences lag behind consumer expectations of today (evidenced by low, or sometimes even negative, NPS scores). Rebuilding the experience from the ground up is sometimes the only way to satisfy today’s consumers in these massive markets.
2. Step-functionally better consumer experience versus the status quo
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Soci raises $80M for its localized marketing platform
Soci, a startup focused on what it calls “localized marketing,” is announcing that it has raised $80 million in Series D funding.
National and global companies like Ace Hardware, Anytime Fitness, The Hertz Corporation and Nekter Juice Bar use Soci (pronounced soh-shee) to coordinate individual stores as they promote themselves through search, social media, review platforms and ad campaigns. Soci said that in 2020, it brought on more than 100 new customers, representing nearly 30,000 new locations.
Co-founder and CEO Afif Khoury told me that the pandemic was a crucial moment for the platform, with so many businesses “scrambling to find a real solution to connect with local audiences.”
One of the key advantages to Soci’s approach, Khoury said, is to allow the national marketing team to share content and assets so that each location stays true to the “national corporate personality,” while also allowing each location to express a “local personality.” During the pandemic, businesses could share basic information about “who’s open, who’s not” while also “commiserating and expressing the humanity that’s often missing element from marketing nationally.”
“The result there was businesses that had to close, when they had their grand reopenings, people wanted to support that business,” he said. “It created a sort of bond that hopefully lasts forever.”
Khoury also emphasized that Soci has built a comprehensive platform that businesses can use to manage all their localized marketing, because “nobody wants to have seven different logins to seven different systems, especially at the local level.”
The new funding, he said, will allow Soci to make the platform even more comprehensive, both through acquisitions and integrations: “We want to connect into the CRM, the point-of-sale, the rewards program and take all that data and marry that to our search, social, reviews data to start to build a profile on a customer.”
Soci has now raised a total of $110 million. The Series D was led by JMI Equity, with participation from Ankona Capital, Seismic CEO Doug Winter and Khoury himself.
“All signs point to an equally difficult first few months of this year for restaurants and other businesses dependent on their communities,” said JMI’s Suken Vakil in a statement. “This means there will be a continued need for localized marketing campaigns that align with national brand values but also provide for community-specific messaging. SOCi’s multi-location functionality positions it as a market leader that currently stands far beyond its competitors as the must-have platform solution for multi-location franchises/brands.”
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UK on-demand supermarket Weezy raises $20M Series A led by NYC’s Left Lane Capital
Weezy — an on-demand supermarket that delivers groceries in as fast as 15 minutes — has raised $20 million in a Series A funding led by New York-based venture capital fund Left Lane Capital. Also participating were U.K.-based fund DN Capital, earlier investors Heartcore Capital and angel investors, notably Chris Muhr, the Groupon founder.
Although the company hasn’t made mention of a later U.S. launch, the presence of U.S. investors would tend to suggest that. Weezy is reminiscent of Kozmo, the on-demand groceries business from the dot-com boom of the late ’90s. However, it differs from Postmates in that it doesn’t do pickups.
The cash injection will be used to expand its grocery delivery service across London and the broader UK, and open two fulfillment centers across London. Some 40 more U.K. sites are planned by the end of 2021 and it plans to add 50 new employees in the next four months.
Launched in July 2020, Weezy uses its own delivery people on pedal cycles or electric mopeds to deliver goods in less than 15 minutes on average. As well as working with wholesalers, it also sources groceries from independent bakers, butchers and markets.
It has pushed at an open door during the pandemic. In Q2 2020, half a million new shoppers joined the grocery delivery sector, which is now worth £14.3 billion in the U.K., according to research.
Kristof Van Beveren, co-founder and CEO of Weezy, said in a statement: “People are no longer happy to wait around for deliveries, and there is strong demand for a more efficient service.”
Weezy’s co-founders are Kristof Van Beveren and Alec Dent. Van Beveren is formerly from the consumer goods world at Procter & Gamble and McKinsey & Company, while Dent headed up operations at U.K. startup Drover and business development at BlaBlaCar.
Harley Miller, managing partner, Left Lane Capital, commented: “Weezy’s founding team have the right balance of drive, experience and temperament to lead in e-commerce innovation and convenience within the UK grocery market and beyond.”
Nenad Marovac, founder and managing partner, DN Capital, said: “Even before the pandemic, interest in online grocery shopping was on the rise. The first time I ordered from Weezy, my delivery arrived in seven minutes and I was hooked.”
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How to convert customers with subscription pricing
The lure of subscription pricing is the guarantee of recurring revenue for your business. Once a customer flips the switch to turn on your subscription, it’s easy money:
- Easy to recognize your revenue.
- Easy to determine your margins and profits.
- Easy to enhance your product and extend that revenue out for months, even years.
While that’s true, converting a subscription customer isn’t as simple as flipping a switch. You can build a platform, launch with fanfare, offer all sorts of incentives and trials to attract potential customers — and watch as they disengage and lapse into limbo.
Contrary to popular belief, subscription pricing doesn’t work because of the lower price point that a monthly installment allows.
That’s the actual guarantee that comes with subscription pricing, which will happen unless you cultivate a funnel that catches potential subscribers as soon as they learn about your product and follows them until their very last sign-in.
I built my first subscription-model product in 1999. I’m currently in early-access on my latest, and I’ve launched a bunch more along the way.
While the customer dynamic has changed over the last 20 years, the conversion process has not. In fact, it’s actually gotten easier to convert and retain customers through the subscription funnel.
Here’s what I’ve learned.
Why subscription pricing works
Subscription pricing is a hot trend in just about every business in every industry. Pay-as-you-go is the new normal from software to retail to service.
In my mind, the major shift occurred when mobile phones started pricing unlimited usage per period instead of fixed or cost per minute. Once usage limits were removed, use cases exploded and the promise of a truly mobile computer was finally realized.
Makers of all stripes learned that lesson: From razors to video streaming to accounting software, pricing models have emerged that focus on time periods instead of units.
But contrary to popular belief, subscription pricing doesn’t work because of the lower price point that a monthly installment allows. It’s effective because a subscription reorients each customer’s mind from product function to value proposition.
I don’t care what kind of German engineering went into my razor blades, as long as I have working blades when I need them.
As an entrepreneur, you probably use at least one digital subscription service to build your own product and company, if not several. In fact, just to get to the MVP of my new project, I subscribed to AWS, MailChimp, Zapier and Bubble. I’m still on the free tier of a few more services for some lower-priority features. There’s a few more I quit or never tried.
Thus, you know that value prop plays a big part of whether the customer will pay and stay. So reinforcing your value proposition should play a big part in every level of your customer funnel.
You must catch and track customers to be effective
A subscription-pricing model without an ability to track the steps in the conversion funnel will result in all the headaches of subscription pricing without any of the benefits.
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Boost ROI with intent data and personalized multichannel marketing campaigns
Coronavirus is causing large and small businesses to drastically cut marketing budgets. In Forrester’s self-described “most optimistic scenario,” the analysts project a 28% drop in U.S. marketing spend by the end of 2021. Even Google is cutting its marketing budget in half. As marketers move forward, Forrester predicts marketing automation platforms will grow despite an overall decline in marketing technology investment.
Automation platforms help marketers scale their communications. However, scaling communications is not a substitute for intimacy, which all humans crave. Because of the pandemic, it is harder than ever to get attention, let alone make a connection. More mass email blasts from your marketing automation platform are not going to get you the connections with prospects you crave. So how should marketers proceed? Direct mail captures 100% of your audience’s attention. It provides a sensory experience for your prospects and customers, and that helps establish an emotional connection.
Winning marketers are strategically merging automation and digital data with the more intimate channel of direct mail. We call this tactile marketing automation (TMA).
TMA is the integration of direct mail or personalized swag with a marketing automation platform. With TMA, a marketer doesn’t have to think about creating direct mail campaigns outside of digital campaigns. Rather, direct mail experiences are already fully integrated into the pre-built customer journey.
TMA uses intent data to inform content, messaging and the timing of direct mail touchpoints that maximize relevancy and scalability. Multichannel campaigns including direct mail report an ROI 18 percentage points higher than those without direct mail. Plus, 84% of marketers state direct mail improves multichannel campaign performance.
Read on to see how you can merge digital communications and direct mail to deliver remarkable experiences that spark a connection.
Incorporate intent data
Personalization is a key ingredient of a remarkable experience. Many marketers automate processes by introducing marketing software and then call it personalization. But, oftentimes it’s just quicker batching and blasting. Brands can’t just change the first name on a piece of content and call it “personalized.” Real personalization is necessary and vital for real results. Our consumers expect more. The best way to introduce real personalization within a marketing mix is to use intent data and trigger-driven campaigns.
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