May
24
2021
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Invoca acquires DialogTech for $100M to expand its conversational intelligence tools

On the heels of expanding its marketing call analytics platform last year to provide more insights to help those in sales, e-commerce and customer experience, Invoca is making its first acquisition to widen the net of companies that it targets. The company has acquired DialogTech, a startup that builds tools for marketers to analyze inbound phone calls and other contacts, in what TechCrunch understands to be a $100 million deal.

As part of the transaction, Santa Barbara-based Invoca will be divesting Swydo, a company that Chicago-based DialogTech acquired in 2018. Swydo — originally from The Netherlands — will remain a partner of Invoca’s, the company said.

Invoca has up to now focused on larger consumer-facing enterprises — its customers include the likes of ADT, AutoNation, DISH, TELUS and The Home Depot — providing them with an AI-based platform that lets their marketing, sales and other teams analyze calls from consumer customers and provide call tracking, coaching and other insights in real time and in the form of post-call reports to help those teams do their jobs more easily.

Gregg Johnson, Invoca’s CEO and one of a growing pool of Salesforce veterans who are reinventing the marketing and sales technology landscape, described DialogTech as “complementary” to what Invoca does, but will specifically help Invoca better target mid-market companies.

The opportunity that both Invoca and DialogTech have identified is that, despite the growth of digital media advertising, social media and other channels for brands to connect to would-be customers, inbound calls remain a very key part of how companies sell goods and services, especially when the sale is of a complex item.

“About 40% to 80% of revenues come through contact centers,” Johnson said. “Brands can do all the retargeting they want but the same strategies in digital don’t work there.”

For those working at the other end of the line, the need for tools to do their jobs better became even more pressing in the last year, a time when customers stayed home and away from physical stores, shifting all of their interactions to virtual and remote channels. Subsequently, they demanded and expected better levels of service there.

“This move enables us to be an even better partner to enterprises and agencies looking to optimize their marketing and drive sales,” said DialogTech CEO Doug Kofoid, in a statement. “Together as Invoca, our combined company will deliver an unrivaled solution for conversation intelligence, with the most innovative technology, expertise, experience, and resources in our industry.”

The combined business will become one of the bigger “martech” startups focusing on conversational insights, with 2,000 customers, more than 300 employees and on track to make more than $100 million this year in revenue. This is, however, just the tip of the iceberg: The conversational intelligence market was estimated to be worth some $4.8 billion in 2020 and is expected to balloon to nearly $14 billion by 2025.

Given how many startups we’ve seen launch in the name of better sales intelligence, it’s likely that this will not be the last piece of consolidation in the area. Combining to expand the functionality of a platform, or to expand the scale and reach of a business, or simply to bring on interesting tech that is easier to acquire than build from scratch, are three areas that will likely drive more M&A.

Invoca last raised funding in October 2019, a $56 million round just ahead of the world shifting into COVID-19 pandemic mode. Johnson confirmed that Invoca — which has to date raised $116 million from Accel, Upfront Ventures, H.I.G. Growth Partners, Morgan Stanley, Salesforce Ventures and others — is in a strong enough position as a business not to need to raise more for this acquisition.

However, I suspect that scaling up like this will help it bid for bigger money and a bigger valuation when it does, as will the fact that peers in the market like Gong (which Johnson described to me as the “B2B version of Invoca”) have seen their valuations catapult in the last year, spurred by the changes in how customers interact with businesses, and sales and marketing can work to better serve them.

Mar
01
2021
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Martech company Zeta Global raises $222.5M in debt

Zeta Global, the marketing technology company founded by David A. Steinberg and former Apple CEO John Sculley, is announcing an additional $222.5 million in new debt financing.

The company has gone down the debt route before — a Series F raised in 2017 combined $115 million funding with $25 million in debt. BofA Securities served as lead arranger and bookrunner for the new financing, with participation from Barclays, Credit Suisse and Morgan Stanley Senior Funding.

“For this round, we were able to both refinance our debt and add in a large amount of capacity for current operations and future initiatives,” Steinberg (Zeta’s CEO) told me via email. “We were able to work with our syndicate to capture a low interest rate and take advantage of the strong credit markets.”

The company emphasizes its data-driven approach to marketing, combining companies’ first-party data with artificial intelligence and what it says are more than 2.4 billion customer identifiers. Steinberg said this approach has only become more crucial, with 2020 delivering “a five-year acceleration” as brands face the challenge of “digitally transforming their business structure to be data-centric.”

“Zeta’s capabilities are helping marketers engage customers across the entire digital ecosystem more intelligently and efficiently, with individualized messages, offers, and content by way of our identity-based data and predictive AI,” Steinberg continued. “Our challenge is to continue to keep up with our customers’ needs and maintain our competitive advantage around data and AI.”

The company’s funding announcement notes that previous loans have been used to finance acquisitions and integrations, including commenting platform Disqus and machine learning-powered marketing platform Boomtrain. Asked whether this new debt will also be used for acquisitions, Steinberg said the company continues to “organically innovate,” with a focus on its customer data platform and connected TV capabilities.


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Feb
24
2021
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Blueshift raises $30M for its AI-based, integrated approach to marketing

The concept of the “marketing cloud” — sold by the likes of Salesforce, Oracle and Adobe — has become a standard way for large tech companies to package together and sell marketing tools to businesses that want to improve how they use digital channels to grow their business.

Some argue, however, that “cloud”, singular, might be a misnomer: typically those tools are not integrated well with each other and effectively are run as separate pieces of software. Today a startup called Blueshift — which claims to offer an end-to-end marketing stack, by having built it from the ground up to include both traditional marketing data as well as customer experience — is announcing some funding, pointing to the opportunity to build more efficient alternatives.

The startup has closed a round of $30 million, a Series C that co-founder and CEO Vijay Chittoor said it will be using to expand to more markets (it’s most active in the U.S. and Europe currently) and also to expand its technology.

“The product already has a unified format, to ingest data from multiple sources and redistribute that out to apps. Now, we want to distribute that data to more last-mile applications,” he said in an interview. “Our biggest initiative is to scale out the notion of us being not just an app but a platform.”

The company’s customers include LendingTree, Discovery Inc., Udacity, BBC and Groupon, and it has seen revenue growth of 858% in the last three years, although it’s not disclosing actual revenues, nor valuation, today.

The round is being led by Fort Ross Ventures, with strong participation also from Avatar Growth Capital. Past investors Softbank Ventures Asia (which led its last round of $15 million), Storm Ventures, Conductive Ventures and Nexus Venture Partners also invested.

The concept for Blueshift came out of Chittoor’s direct experience at Groupon — which acquired his previous startup, social e-commerce company Mertado — and before that a long period at Walmart Labs — which Walmart rebranded after it acquired another startup where Chittoor was an early employee, semantic search company Kosmix.

“The challenges we are solving today we saw firsthand as challenges our customers saw at Groupon and Walmart,” he said. “The connected customer journey is creating a thousand times more data than before, and people and brands are engaging across more touchpoints. Tracking that has become harder with legacy channel-centric applications.”

Blueshift’s approach for solving that has been, he said, “to unify the data and to make decisions at customer level.”

That is to say, although the customer experience today is very fragmented — you might potentially encounter something about a company or brand in multiple places, such as in a physical environment, on various social media platforms, in your email, through a web search, in a vertical search portal, in a marketplace on a site, in an app, and so on — the experience for marketers should not be.

The company addresses this by way of a customer data platform (CDP) it markets as “SmartHub.” Designed for non-technical users although customizable by engineers if you need it to be, users can integrate different data feeds from multiple sources, which then Blueshift crunches and organises to let you view in a more structured way.

That data can then be used to power actions in a number of places where you might be setting up marketing campaigns. And Chittoor pointed out — like other marketing people have — that these days, the focus on that is largely first-party data to fuel that machine, rather than buying in data from third-party sources (which is definitely part of a bigger trend).

“Our mission is to back category-leading companies that are poised to dominate a market. Blueshift clearly stood out to us as the leader in the enterprise CDP space,” said Ratan Singh of Fort Ross Ventures in a statement. “We are thrilled to partner with the Blueshift team as they accelerate the adoption of their SmartHub CDP platform.” Singh is joining Blueshift’s board with this round.

Aug
04
2020
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Yotpo raises $75M for its e-commerce marketing cloud

“Marketing cloud” has become an increasingly popular concept in the world of marketing technology — used by the likes of Salesforce, Adobe, Oracle and others to describe their digital tool sets for organizations to identify and connect with customers. Now, a startup that is building its own take on the idea aimed specifically at e-commerce companies is announcing some funding after seeing a surge of business in the last few months.

Yotpo, which provides a suite of tool to help direct-to-consumer and other e-commerce players build better relationships with customers, is today announcing that it has raised $75 million in funding, money it will use to continue growing its suite of products, as well as to acquire more customers and build out more integration partnerships.

The Series E included a number of Yotpo’s existing investors, namely Bessemer Venture Partners, Access industries (the owner of Warner Music Group, among a number of other holdings) and Vertex Ventures (a subsidiary of Temasek), new investor Hanaco (which focuses on Israeli startups — Yotpo is co-headquartered in Tel Aviv and New York) and other unnamed investors.

It brings the total raised by the startup to $176 million, and while it’s not disclosing valuation, its CEO Tomer Tagrin — who co-founded the company with COO Omri Cohen — describes it as “nearly a unicorn.”

“I like to call what we’re building a flamingo, which is also a rare and beautiful animal but also a real thing, and we are a proper business,” he said in an interview, adding that Yotpo is on target for ARR next year to be $100 million.

The company had its start as an app in Shopify’s App Store, providing tools to Shopify customers to help with customer engagement by way of user-generated content, and while it has outgrown that single relationship — it now has some 500 additional strategic partners, including Salesforce, Adobe, BigCommerce and others — Yotpo’s CEO still likes to describe his company in Shopify-ish terms.

“Just as Shopify manages your business, we manage your customers end to end,” Tagrin said. He said that while it’s great to see the bigger trend of consolidation around marketing clouds, it’s not a one-size-fits-all problem. He believes Yotpo’s e-commerce-specific approach to that stands apart from the pack because it addresses issues unique to D2C and other e-commerce companies.

Yotpo’s services today include SMS and visual marketing, loyalty and referral services and reviews and ratings, which are used by a range of e-commerce companies, spanning from newer direct-to-consumer brands like Third Love and Away, to more established names like Patagonia and 1-800-Flowers. Some of these have been built in-house, and some by way of acquisition — most recently, SMSBump, in January. The plan is to use some of the funding to continue that acquisition strategy.

“Since our first investment more than three years ago, Tomer and Omri have executed flawlessly, expanding the product suite, serving a wider range of customers, and continually hiring strong talent across the organization,” says Adam Fisher, a partner at BVP, in a statement. “Yotpo is singularly focused on helping direct-to-consumer eCommerce brands solve the dual challenge of engaging consumers and increasing revenue, and with their multi-product strategy and innovative edge, they are uniquely positioned to dominate the eCommerce industry for years to come.”

Yotpo is built as a freemium platform, with some 9,000 customers paying for services, and a further 280,000 customers on its free-usage tier. Customer count grew by 250% in the last year, Tagrin said.

The COVID-19 pandemic has had a well-documented impact on internet use, and specifically e-commerce, as people turned to digital channels in record numbers to procure things while complying with shelter-in-place orders, or trying to increase social distancing to slow down the spread of the coronavirus.

E-commerce has been on the rise for years, but the acceleration of that trend has been drastic since February, with revenue and spend both regularly exceeding baseline figures over the last several months, according to research from digital marketing agency Common Thread Collective.

That, in turn, had a big impact on companies that help enable those e-commerce enterprises operate in more direct and personable ways. Yotpo was a direct beneficiary: It said it had a surge of sign-ups of new customers, many taking paid services, working out to a 170% year-on-year ARR and lower customer churn.

The bigger picture, of course, is not completely rosy, with thousands of layoffs across the whole tech service, and a huge number of brick-and-mortar business closures. Those economic indicators could ultimately also have a knock-on effect not just in more business moving online, but also a slowdown in spending overall.

That will inevitably have an impact on startups like Yotpo, too, which is definitely on a rise now but will continue to think longer term about the impact and how it can continue to diversify its products to meet a wider set of customer use cases.

For example, today, the company addresses customer care needs by way of integrations with companies like Zendesk, but longer term it might consider how it can bring in services like this to continue to build out the touchpoints between D2C brands and their customers, and specifically running those through a bigger picture of the customer as profiled on Yotpo’s platform.

This is a big part of our product in our meetings and debates,” Tagrin said about product expansions.

“I do think any celebration of growth and funding comes to me with something else: we need to be internalising more what is going on,” he said. “The world is not back to normal and we shouldn’t act like it is.”

Dec
11
2019
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Acquia nabs CDP startup AgilOne, which raised $41M

Acquia announced it has acquired customer data platform (CDP) startup AgilOne today. The companies did not disclose the purchase price.

CDPs are all the rage among customer experience vendors, as they provide a way to pull data from a variety of channels to build a more complete picture of the customer. The goal here is to deliver meaningful content to the customer based on what you know about them. Having a platform like this to draw upon makes it more likely that you will hit the target more accurately.

Acquia co-founder and CTO Dries Buytaert says he has been watching this space for the last year, and wanted to add this piece to the Acquia tool chest. “Adding a CDP like AgilOne to our existing platform will help our customers unify their data across various tools in their technology stack to drive better, more personal customer experiences,” he said.

In particular, he says he liked AgilOne because it used an intelligence layer while building the customer record. “What sets AgilOne apart from other CDPs are its machine learning capabilities, which intelligently segment customers and predict customer behaviors (such as when a customer is likely to purchase something). This allows for the creation and optimization of next-best action models to optimize offers and messages to customers on a 1:1 basis.”

Like most startup founders, AgilOne CEO Omer Artun sees this as an opportunity to grow his company, probably faster than he could have on his own. “Since AgilOne’s inception, our vision has been to give marketers the direct power to understand who their customers are and engage with them in a genuine way in order to boost profitability and create the omnichannel experiences that customers crave. Through this acquisition, Acquia will enable us to continue to deliver, and build upon, this vision,” he wrote in a blog post announcing the acquisition.

Tony Byrne, founder and principal analyst at the Real Story Group, has been watching the marketing automation space for some time, as well as the burgeoning CDP market. He sees this move as good for Acquia, but wonders how it will fit with other pieces in the Acquia stack. “This in theory allows them to support the unification of customer data across their suite,” Byrne told TechCrunch.

But he cautions that the company could struggle incorporating AgilOne into its platform. “The Marketing Automation platform they purchased targets mostly B2B. AgilOne is dialed in on B2C use cases and a fairly narrow set of vertical segments. It will take a lot of work to make it into a CDP that could adequately serve Acquia’s diverse customer base,” he said.

Acquia was acquired by Vista Equity Partners for $1 billion in September, and it tends to encourage its companies to be more acquisitive than they might have been on their own. “Vista has been supportive of our M&A strategy and believes strongly in AgilOne as a part of Acquia’s vision to redefine the customer experience stack,” Buytaert said.

AgilOne raised over $41 million, according to PitchBook data. Investors included Tenaya Capital, Sequoia Capital and Mayfield Fund. It had a post valuation of just over $115 million and was pegged as likely acquisition target by Pitchbook.

AgilOne customers will be happy to hear that Acquia plans to continue to sell it as a stand-alone product in addition to making it part of the Acquia Open Marketing Cloud.

Oct
23
2017
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ActionIQ nabs $30M led by A16Z to bring big data targeting to marketers

 The trend of using big data analytics to glean more targeted insights for your business continues to be democratized, with an increasing number of startups hitting the market to help those who are not data scientists nor engineers take advantage of these kinds of tools. In the latest development, a startup called ActionIQ — a marketing activation platform that gives marketers better… Read More

Jul
19
2017
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Jeremy Bloom’s Integrate raises $8 million for marketing software

 You may know Jeremy Bloom from his days as an Olympian on the U.S. ski team or from when he was a professional football player. These days, he’s busy running an enterprise software startup for marketers. With clients like Salesforce and Dell, Phoenix-based Integrate has raised $8 million in funding from Iron Gate Capital and existing investors. Read More

Apr
27
2017
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Marketing tech company Zeta Global raises $140M at a $1.3B valuation

 Zeta Global, the marketing tech company that has recently acquired the likes of eBay’s enterprise arm and Acxiom Impact, is preparing for another round of acquisitions and investments in its technology. To do so, the company today announced that it has raised a $140 million Series F round. Read More

Jan
22
2016
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FiveStars Gets $50M To Help Small Retailers Run Loyalty Programs Like Their Bigger Rivals

POS FiveStars, a five year-old startup that has built a platform and app to run loyalty programs and shopping analytics for small brick-and-mortar retailers, has received a reward of its own: the company has raised a round of $50 million, funding that it plans to use to continue its focus on “mom and pop shops” and building its brand and business across the U.S., CEO and… Read More

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