Mar
25
2020
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Espressive lands $30M Series B to build better help chatbots

Espressive, a four-year-old startup from former ServiceNow employees, is working to build a better chatbot to reduce calls to company help desks. Today, the company announced a $30 million Series B investment.

Insight Partners led the round with help from Series A lead investor General Catalyst along with Wing Venture Capital. Under the terms of today’s agreement, Insight founder and managing director Jeff Horing will be joining the Espressive Board. Today’s investment brings the total raised to $53 million, according to the company.

Company founder and CEO Pat Calhoun says that when he was at ServiceNow he observed that, in many companies, employees often got frustrated looking for answers to basic questions. That resulted in a call to a Help Desk requiring human intervention to answer the question.

He believed that there was a way to automate this with AI-driven chatbots, and he founded Espressive to develop a solution. “Our job is to help employees get immediate answers to their questions or solutions or resolutions to their issues, so that they can get back to work,” he said.

They do that by providing a very narrowly focused natural language processing (NLP) engine to understand the question and find answers quickly, while using machine learning to improve on those answers over time.

“We’re not trying to solve every problem that NLP can address. We’re going after a very specific set of use cases which is really around employee language, and as a result, we’ve really tuned our engine to have the highest accuracy possible in the industry,” Calhoun told TechCrunch.

He says what they’ve done to increase accuracy is combine the NLP with image recognition technology. “What we’ve done is we’ve built our NLP engine on top of some image recognition architecture that’s really designed for a high degree of accuracy and essentially breaks down the phrase to understand the true meaning behind the phrase,” he said.

The solution is designed to provide a single immediate answer. If, for some reason, it can’t understand a request, it will open a help ticket automatically and route it to a human to resolve, but they try to keep that to a minimum. He says that when they deploy their solution, they tune it to the individual customers’ buzzwords and terminology.

So far they have been able to reduce help desk calls by 40% to 60% across customers with around 85% employee participation, which shows that they are using the tool and it’s providing the answers they need. In fact, the product understands 750 million employee phrases out of the box.

The company was founded in 2016. It currently has 65 employees and 35 customers, but with the new funding, both of those numbers should increase.

Feb
19
2020
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SentinelOne raises $200M at a $1.1B valuation to expand its AI-based endpoint security platform

As cybercrime continues to evolve and expand, a startup that is building a business focused on endpoint security has raised a big round of funding. SentinelOne — which provides a machine learning-based solution for monitoring and securing laptops, phones, containerised applications and the many other devices and services connected to a network — has picked up $200 million, a Series E round of funding that it says catapults its valuation to $1.1 billion.

The funding is notable not just for its size but for its velocity: it comes just eight months after SentinelOne announced a Series D of $120 million, which at the time valued the company around $500 million. In other words, the company has more than doubled its valuation in less than a year — a sign of the cybersecurity times.

This latest round is being led by Insight Partners, with Tiger Global Management, Qualcomm Ventures LLC, Vista Public Strategies of Vista Equity Partners, Third Point Ventures and other undisclosed previous investors all participating.

Tomer Weingarten, CEO and co-founder of the company, said in an interview that while this round gives SentinelOne the flexibility to remain in “startup” mode (privately funded) for some time — especially since it came so quickly on the heels of the previous large round — an IPO “would be the next logical step” for the company. “But we’re not in any rush,” he added. “We have one to two years of growth left as a private company.”

While cybercrime is proving to be a very expensive business (or very lucrative, I guess, depending on which side of the equation you sit on), it has also meant that the market for cybersecurity has significantly expanded.

Endpoint security, the area where SentinelOne concentrates its efforts, last year was estimated to be around an $8 billion market, and analysts project that it could be worth as much as $18.4 billion by 2024.

Driving it is the single biggest trend that has changed the world of work in the last decade. Everyone — whether a road warrior or a desk-based administrator or strategist, a contractor or full-time employee, a front-line sales assistant or back-end engineer or executive — is now connected to the company network, often with more than one device. And that’s before you consider the various other “endpoints” that might be connected to a network, including machines, containers and more. The result is a spaghetti of a problem. One survey from LogMeIn, disconcertingly, even found that some 30% of IT managers couldn’t identify just how many endpoints they managed.

“The proliferation of devices and the expanding network are the biggest issues today,” said Weingarten. “The landscape is expanding and it is getting very hard to monitor not just what your network looks like but what your attackers are looking for.”

This is where an AI-based solution like SentinelOne’s comes into play. The company has roots in the Israeli cyberintelligence community but is based out of Mountain View, and its platform is built around the idea of working automatically not just to detect endpoints and their vulnerabilities, but to apply behavioral models, and various modes of protection, detection and response in one go — in a product that it calls its Singularity Platform that works across the entire edge of the network.

“We are seeing more automated and real-time attacks that themselves are using more machine learning,” Weingarten said. “That translates to the fact that you need defence that moves in real time as with as much automation as possible.”

SentinelOne is by no means the only company working in the space of endpoint protection. Others in the space include Microsoft, CrowdStrike, Kaspersky, McAfee, Symantec and many others.

But nonetheless, its product has seen strong uptake to date. It currently has some 3,500 customers, including three of the biggest companies in the world, and “hundreds” from the global 2,000 enterprises, with what it says has been 113% year-on-year new bookings growth, revenue growth of 104% year-on-year and 150% growth year-on-year in transactions over $2 million. It has 500 employees today and plans to hire up to 700 by the end of this year.

One of the key differentiators is the focus on using AI, and using it at scale to help mitigate an increasingly complex threat landscape, to take endpoint security to the next level.

“Competition in the endpoint market has cleared with a select few exhibiting the necessary vision and technology to flourish in an increasingly volatile threat landscape,” said Teddie Wardi, managing director of Insight Partners, in a statement. “As evidenced by our ongoing financial commitment to SentinelOne along with the resources of Insight Onsite, our business strategy and ScaleUp division, we are confident that SentinelOne has an enormous opportunity to be a market leader in the cybersecurity space.”

Weingarten said that SentinelOne “gets approached every year” to be acquired, although he didn’t name any names. Nevertheless, that also points to the bigger consolidation trend that will be interesting to watch as the company grows. SentinelOne has never made an acquisition to date, but it’s hard to ignore that, as the company to expand its products and features, that it might tap into the wider market to bring in other kinds of technology into its stack.

“There are definitely a lot of security companies out there,” Weingarten noted. “Those that serve a very specific market are the targets for consolidation.”

Jan
09
2020
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Sisense nabs $100M at a $1B+ valuation for accessible big data business analytics

Sisense, an enterprise startup that has built a business analytics business out of the premise of making big data as accessible as possible to users — whether it be through graphics on mobile or desktop apps, or spoken through Alexa — is announcing a big round of funding today and a large jump in valuation to underscore its traction. The company has picked up $100 million in a growth round of funding that catapults Sisense’s valuation to over $1 billion, funding that it plans to use to continue building out its tech, as well as for sales, marketing and development efforts.

For context, this is a huge jump: The company was valued at only around $325 million in 2016 when it raised a Series E, according to PitchBook. (It did not disclose valuation in 2018, when it raised a venture round of $80 million.) It now has some 2,000 customers, including Tinder, Philips, Nasdaq and the Salvation Army.

This latest round is being led by the high-profile enterprise investor Insight Venture Partners, with Access Industries, Bessemer Venture Partners, Battery Ventures, DFJ Growth and others also participating. The Access investment was made via Claltech in Israel, and it seems that this led to some details of this getting leaked out as rumors in recent days. Insight is in the news today for another big deal: Wearing its private equity hat, the firm acquired Veeam for $5 billion. (And that speaks to a particular kind of trajectory for enterprise companies that the firm backs: Veeam had already been a part of Insight’s venture portfolio.)

Mature enterprise startups have proven their business cases are going to be an ongoing theme in this year’s fundraising stories, and Sisense is part of that theme, with annual recurring revenues of over $100 million speaking to its stability and current strength. The company has also made some key acquisitions to boost its business, such as the acquisition of Periscope Data last year (coincidentally, also for $100 million, I understand).

Its rise also speaks to a different kind of trend in the market: In the wider world of business intelligence, there is an increasing demand for more digestible data in order to better tap advances in data analytics to use it across organizations. This was also one of the big reasons why Salesforce gobbled up Tableau last year for a slightly higher price: $15.7 billion.

Sisense, bringing in both sleek end user products but also a strong theme of harnessing the latest developments in areas like machine learning and AI to crunch the data and order it in the first place, represents a smaller and more fleet of foot alternative for its customers. “We found a way to make accessing data extremely simple, mashing it together in a logical way and embedding it in every logical place,” explained CEO Amir Orad to us in 2018.

“We have enjoyed watching the Sisense momentum in the past 12 months, the traction from its customers as well as from industry leading analysts for the company’s cloud native platform and new AI capabilities. That coupled with seeing more traction and success with leading companies in our portfolio and outside, led us to want to continue and grow our relationship with the company and lead this funding round,” said Jeff Horing, managing director at Insight Venture Partners, in a statement.

To note, Access Industries is an interesting backer which might also potentially shape up to be strategic, given its ownership of Warner Music Group, Alibaba, Facebook, Square, Spotify, Deezer, Snap and Zalando.

“Given our investments in market leading companies across diverse industries, we realize the value in analytics and machine learning and we could not be more excited about Sisense’s trajectory and traction in the market,” added Claltech’s Daniel Shinar in a statement.

Jan
09
2020
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Insight Partners acquires data management company Veeam for $5B

Last year Insight Partners invested $500 million in cloud data management company Veeam. It apparently liked the company so much that today it announced it has acquired the Swiss startup for $5 billion.

Veeam helps customers with cloud data backup and disaster recovery. The company, which has been based in Baar, Switzerland, says that it had $1 billion in revenue last year. It boasts 365,000 customers worldwide, including 81% of the Fortune 500.

Ray Wang, founder and principal analyst at Constellation Research, says that data management is an increasingly important tool for companies working with data on prem and in the cloud. “This is a smart move, as the data management space is rapidly consolidating. There’s a lot of investment in managing hybrid clouds, and data management is key to enterprise adoption,” Wang told TechCrunch.

The deal is coming with some major changes. Veeam’s EVP of Operations, William H. Largent, will be promoted to CEO. Danny Allan, who was VP of product strategy, will be promoted to CTO. In addition, the company will be moving its headquarters to the U.S. Veeam currently has around 1,200 employees in the U.S., but expects to expand that in the coming year.

New CEO Allan says in spite of their apparent success in the market, and the high purchase price, he believes under Insight’s ownership, the company can go further than it could have on its own. “While Veeam’s preeminence in the data management space, currently supporting 81% of the Fortune 500, is undeniable, this commitment from Insight Partners and deeper access to its unmatched business strategy [from its scale-up] division, Insight Onsite, will bring Veeam’s solutions to more businesses across the globe.”

Insight Onsite is Insight Partners’ strategy arm that is designed to help its portfolio companies be more successful. It provides a range of services in key business areas, like sales, marketing and product development.

Veeam has backup and recovery tools for both Amazon Web Services and Microsoft Azure, along with partnerships with a variety of large enterprise vendors, including Cisco, IBM, Dell EMC and HPE.

The company, which was founded in 2006, had a valuation of more than $1 billion prior to today’s acquisition, according to Crunchbase data. The deal is expected to close in the first quarter this year.

Jul
17
2019
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ContractPodAi scores $55M for its ‘AI-powered’ contract management software

ContractPodAi, a London-based startup that has developed what it describes as AI-powered contract lifecycle management software, is disclosing $55 million in Series B funding. The round is led by U.S.-based Insight Partners, with participation from earlier backer Eagle Investment.

Founded in 2012, ContractPodAi offers an “end-to-end” solution spanning the three main aspects of contract management: contract generation, contract repository and third-party review. Its AI offering, which uses IBM’s Watson, claims to streamline the contract management process and reduce the burden on corporate in-house legal teams.

“The legal profession has been historically behind the curve in technology adoption and our objective here is to support to digital transformation of legal departments via our contract management platform,” ContractPodAi co-founder and CEO Sarvarth Misra tells TechCrunch.

“Our business focuses on providing in-house counsel of corporations across the world with an easy to use, out of the box and scalable end to end contract management platform at a fixed fee SaaS licence model.”

With regards to ContractPodAi’s target customer, Misra says its solution is industry agnostic but is typically sold to large international businesses, including FTSE 500 and Fortune 2000 corporations. Customers include Bosch Siemens, Braskem, EDF Energy, Total Petroleum, Benjamin Moore and Freeview.

Armed with new capital, ContractPodAi says it plans to “significantly” scale up its product development, sales and customer success teams globally. The company already has offices in San Francisco, New York, Glasgow and Mumbai, in addition to its London HQ.

Adds Misra: “We believe the market for contract management solutions is fragmented with providers focusing one or two aspects of contract management functionality. ContractPodAi’s objective has been to provide one contract management ecosystem which covers all aspects of contract management functionality… This, along with our fixed, transparent pricing and ability to provide full implementation as part of the annual SaaS, differentiates us the from the rest of the providers.”

Jun
25
2019
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Showpad, a sales enablement platform for presentations and other collateral, raises $70M

Sales teams have long turned to tech solutions to help improve how they source leads, develop relationships and close deals. Now, one of the startups that helps out at a key point in that trajectory is announcing a round of growth funding to help fuel its own rapid growth. Showpad, a sales enablement platform that lets salespeople source and organise relevant content and other collateral that they use in their deals, has raised a Series D of $70 million.

The funding, which brings the total raised by Showpad to $160 million, is coming in the form of debt and equity. The equity part is co-led by Dawn Capital and Insight Partners, with existing investors Hummingbird Ventures, and Korelya Capital also participating. Silicon Valley Bank is providing debt financing. This is one of the first big investments out of Dawn’s Opportunities Fund that we wrote about last week.

The company is not disclosing its valuation but Pieterjan Bouten, the CEO who co-founded the company with Louis Jonckheere (currently CPO) and Peter Minne (CTO), confirmed that it has doubled since last year, and is seven times the valuation it had when it raised a $50 million Series C in 2016. The company is growing 90% year-on-year at the moment in terms of revenues.

And as a point of reference, another sales enablement player, Seismic, last December raised a Series E of $100 million at a $1 billion valuation.

Founded in Ghent, Belgium, Showpad today operates across two main headquarters, its original European base and Chicago. The latter was the homebase of LearnCore, a company that Showpad acquired last year that focuses on sales coaching and training. This became a strategic acquisition to expand Showpad’s primary product, a platform that acts as a kind of content management system for sales collateral. (Today, while Chicago is where Showpad builds its go-to market efforts and professional services, Ghent focuses on engineering and product, he said.) As it happens, Chicago is also the headquarters of Seismic.

As Bouten described in an interview, Showpad is part of what he considers to be the fourth pillar of the technology marketing stack: storage (the cloud services where you keep all your data), CRM, marketing automation and sales enablement, where Showpad sits.

While the first three are key to helping to manage a salesperson’s activities and work, the fourth is a crucial one for helping to make sure a salesperson can do his or her job more effectively.

Traditionally a lot of the content that salespeople used — presentations, white papers, other materials — to help make their cases and close their deals would be managed offline and directly by individual salespeople. Showpad has taken some of that process and made it digital, which means that now teams of salespeople can more effectively share materials amongst each other; and interestingly the material and its link to successful sales becomes part of how Showpad “learns” what works and what doesn’t.

That, in turn, helps build Showpad’s own artificial intelligence algorithms, to help suggest the best materials for a particular sales effort either to someone else in that team, or to other salespeople using the platform.

“To date there has been enormous innovation in automating the marketing and sales workflow. However, in the end, sales comes down to one person selling to another,” said Norman Fiore, General Partner at Dawn Capital and member of the Showpad Board, in a statement. “Historically, this has been an offline process that has been wildly inconsistent and opaque. Showpad’s suite of products succeeds in bringing this process online for the first time with data-rich feedback loops on the effectiveness of teams, managers, salespeople and even individual pieces of sales content.”

This is a crowded area of the market with a number of standalone companies building sales enablement solutions, but also other companies within the sales stack also adding on enablement as a value-added service.

For now, though, Bouten notes that these are more strategic partners than competitors. For example, Salesforce and Microsoft are partners, and, he adds, “We integrate with Salesloft to make sure sure emails that are sent out are using the right content. We become the single source of truth but also are being used for outreach.”

Today, the company has around 1,200 enterprise customers, including Johnson & Johnson, GE Healthcare, Bridgestone, Honeywell, and Merck. The plan going forward will be to continue building out the services that it offers around its sales enablement software, alongside the core product itself.

“You can equip sales people with the best content, but if they are not trained and coached in the right way, it goes nowhere,” Bouten said.

Apr
25
2019
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SalesLoft nabs $70M at around $600M valuation for its sales engagement platform

Artificial intelligence and other tech for automating some of the more repetitive aspects of human jobs continues to be a growing category of software, and today a company that builds tools to address this need for salespeople has raised a tidy sum to grow its business.

SalesLoft, an Atlanta-based startup that has built a platform for salespeople to help them engage with their clients — providing communications tools, supporting data and finally analytics to “coach” salespeople to improve their processes — has raised $70 million in a Series D round of funding led by Insight Partners with participation from HarbourVest.

Kyle Porter, SalesLoft’s co-founder and CEO, would not disclose the amount of funding in an interview, but he did confirm that it is more than double its valuation from the previous round — a $50 million Series C that included LinkedIn among the investors (more on that below) — but less than $1 billion. That round was just over a year ago and would have valued the firm at $250 million. That would put SalesLoft’s current valuation at more than $500 million, and a source close to the company notes that it’s around $600 million.

While there are a number of CRM and sales tools out in the market today, Porter believes that many of the big ones might better be described as “dumb databases or repositories” of information rather than natively aimed at helping source and utilise data more effectively.

“They are not focused on improving how to connect buyers to sales teams in sincere ways,” he said. “And anytime a company like Salesforce has moved into tangential areas like these, they haven’t built from the ground up, but through acquisitions. It’s just hard to move giant aircraft carriers.”

SalesLoft is not the only one that has spotted this opportunity, of course. There are dozens of others that are either competing on single or all aspects of the same services that SalesLoft provides, including the likes of Clari, Chorus.ai, Gong, Conversica, Afiniti and not least Outreach — which is seen as a direct competitor on sales engagement and itself raised $114 million on a $1.1 billion valuation earlier this month.

One of the notable distinctions for SalesLoft is that one of its strategic investors is LinkedIn, which participated in its Series C. Before Microsoft acquired it, LinkedIn was seen as a potential competitor to Salesforce, and many thought that Microsoft’s acquisition was made squarely to help it compete against the CRM giant.

These days, Porter said that his company and LinkedIn have a tight integration by way of LinkedIn’s Sales Navigator product, which SalesLoft users can access and utilise directly within SalesLoft, and they have a hotline to be apprised of and help shape LinkedIn’s API developments. SalesLoft is also increasingly building links into Microsoft Dynamics, the company’s CRM business.

“We are seeing the highest usage in our LinkedIn integration among all the other integrations we provide,” Porter told me. “Our customers find that it’s the third most important behind email and phone calls.” Email, for all its cons, remains the first.

The fact that this is a crowded area of the market does speak to the opportunity and need for something effective, however, and the fact that SalesLoft has grown revenues 100 percent in each of the last two years, according to Porter, makes it a particularly attractive horse to bet on.

“So many software companies build a product to meet a market need and then focus purely on selling. SalesLoft is different. This team is continually innovating, pushing the boundaries, and changing the face of sales,” said Jeff Horing, co-founder and MD of Insight Venture Partners, in a statement. “This is one reason the company’s customers are so devoted to them. We are privileged to partner with this innovative company on their mission to improve selling experiences all over the world.”

Going forward, Porter said that in addition to expanding its footprint globally — recent openings include a new office in London — the company is going to go big on more AI and “intelligence” tools. The company already offers something it calls its “coaching network,” which is not human but AI-based and analyses calls as they happen to provide pointers and feedback after the fact (similar to others like Gong and Chorus, I should note).

“We want to give people a better way to deliver an authentic but ultimately human way to sell,” he said.

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