Sramana Mitra: What was the next inflection point?
Jason VandeBoom: Right as we were getting comfortable with SaaS, we were still very much similar to being a contact list management tool. We quickly realized that we don’t want to be an email marketing company. It didn’t follow any of our beliefs. It didn’t even follow a lot of the functionality in our product.
We were more about sending fewer messages at the right time and using intelligence to drive all that. There was a disconnect between branding ourselves as an email marketing company and what we truly thought we were. We decided to change again and recategorized ourselves as a marketing automation company. That involved some marketing.
Sramana Mitra: We’re talking 2013?
Jason VandeBoom: Yes.
Sramana Mitra: In 2013, there was already a ton of activity. There were major players like Marketo. What is the justification of coming up with another marketing automation company and what is the differentiation?
Jason VandeBoom: Basically you have these marketing automation companies people know of that all came up around the same time. They all went right to the mid-market and enterprise segements. It left this vacuum in this part of mid-market and SMB where very few people were operating.
You had companies like InfusionSoft operating in the SMB to mid-market but they were exclusively focused on sales and not on the actual product. It provided a really great opportunity from that. What we’ve seen from that is really focusing on being truly product-first. We’ve been able to take a ton of market share from InfusionSoft and we were able to graduate people off of classics email marketing companies.
At this point, the bigger players haven’t been innovating so we’re chipping away at them as well. There was this void in the market and we just filled that. That fueled a lot of growth.
Sramana Mitra: Can you give us a flavor of that growth? What kind of revenues were you doing with this product in the 2013 to 2016 timeframe? How did the business develop?
Jason VandeBoom: In 2014, our revenue was about $1 million or so. Then we started jumping to $5 million and $20 million. We’ll be approaching $40 million now. In the last 12 months, we’ve gone from 70 people to about 210 today. We’ve done that while remaining cash flow positive.
Sramana Mitra: You bootstrapped the company all the way?
Jason VandeBoom: We used the bootstrapping mentality the whole way. We’ve been cash flow positive this whole time. We did take an investment last year of $20 million. We didn’t have to deploy that capital to actually get this growth. It was purely optimal timing from the standpoint of picking the partner we want.
Sramana Mitra: Who made that investment?
Jason VandeBoom: It was Silversmith Capital Partners. It’s a newer firm but they have experience with companies like SurveyMonkey.