Posted on Friday, Apr 24th 2015
A new report by BI Intelligence suggests that social media ad spending in the US will grow from $6.1 billion in 2013 to $14 billion by 2018. The growth in this ad spend is creating a big need for players like Billion Dollar Unicorn club contender Hootsuite that help companies manage their social media marketing better.
Vancouver-based Hootsuite was founded in 2008 by Ryan Holmes who saw an opportunity to create a better social media experience for businesses. Prior to setting up Hootsuite, Holmes had set up Invoke Media, an online digital agency that specialized in social media and mobile app marketing. As part of Invoke’s founding team, Holmes realized that there was a need to simplify the problem created by the presence of multiple Twitter accounts and profiles for their clients. Hootsuite was spun-off of Invoke Media as they focused on this need of better managing these multiple social media accounts.
Hootsuite’s platform allows their customers to engage with people across all of their accounts on a single and secure dashboard. The dashboard provides detailed analytics while letting users assign messages, create workflows, and streamline communications with collaborators and clients. They have simplified the process of social marketing by allowing customers to post to multiple social media accounts through a single click, schedule posts, find targeted content using Google, Google Maps, and Yelp and even reply to a social comment using the browser window.
They continue to add to their offerings and in 2014 announced the acquisition of social telephony company Zeetl. The two-person startup Zeetl integrates telephony with social media so that brands can manage customer support better. They allow users to send a single-use link to a recipient via social media that lets the recipient call a support phone number either by phone (toll-free), browser, or Skype. Hootsuite is integrating this voice technology into their social platform.
Hootsuite operates on a freemium model. The basic platform is available for free and allows users to manage up to three social profiles and provides basic analytics and messaging capabilities. The premium small business version is available at a price of $69 per month and allows up to 100 social profiles, enhanced analytics, security, dashboard set-up, and technical support. For consultants and practitioners, Hootsuite’s premium version is available for $9.99 a month.
The company does not disclose its financials, but it has seen rapid market adoption since inception. Within a year of setting up, they reached 200,000 accounts and now they have more than 10 million users in over 175 countries.
After initially being bootstrapped from Invoke, Hootsuite has been venture funded so far. They have raised $250 million in funding from investors including Fidelity Investments, Silicon Valley Bank, OMERS Ventures, Insight Venture Partners, Accel Partners, Hearst Ventures, Blumberg Capital, Millennium Technology Value Partners, Geoff Entress, Leo Group LLC, Blumberg Capital, Hearst Ventures, and Geoff Entress. Their last round of funding was held in September 2014 when they raised $60 million at a valuation estimated at $800 million. Given the company’s rapid acceleration, they are surely going to enter the Billion Dollar Unicorn club soon. They are planning on an IPO within the next year.
More investigation and analysis of Unicorn companies can be found in my latest Entrepreneur Journeys book, Billion Dollar Unicorns. Unicorns will also be discussed with some special guests during our 1M/1M Roundtable programs over the next few weeks. To be a part of the conversation, please register here. The term Unicorn was coined in a TechCrunch article by Aileen Lee of Cowboy Ventures.
This segment is a part in the series : Billion Dollar Unicorns
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