Infusionsoft Rakes in $54M to Automate Marketing for Small Businesses
BY: Barb Darrow ~
Marketing automation SaaS vendors remain hot properties. Oracle bought Eloqua for $871 million, Hubspot nabbed a $35 million mezzanine round, and now Infusionsoft has $54M in fresh cash from Goldman Sachs and others to attack the small business audience.
Marketing automation continues to be a bright spot in tech. Infusionsoft, which offers integrated marketing automation software for small businesses, just netted a cool $54 million in a new funding round led by Goldman Sachs with a contribution from Arthur Ventures.
The Chandler, Ariz.-based company, which offers a SaaS suite comprising both CRM and marketing automation to small companies, will use the new money to educate small businesses about the value of an all-in-one SaaS suite and to add functions to CRM and lead generation services, Infusionsoft CEO and Co-Founder Clate Mask told me.
In November, Hubspot, another marketing automation player, netted $35 million in mezzanine funding and just before Christmas, Oracle said it was shelling out $871 million to buy Eloqua, another, more enterprise-focused, marketing automation vendor. All of these vendors aimto help customers find and qualify leads — from online or other ads, from Facebook, from Twitter and other sources and convert them into actual sales. Many companies now use a hodgepodge of different processes and products for this purpose.
While there is some contention with Hubspot, Infusionsoft targets smaller companies — those with 25 employees or fewer and more than $100,000 in annual revenue — of which there are an estimated 27 million in the US alone — while Hubspot focuses on the bigger companies in the small and medium business (SMB) market, Mask said.
Infusionsoft offers these companies CRM integrated with marketing automation — the practice of culling and promoting leads. “On the CRM side we compete with Salesforce.com and Zoho while on the marketing automation side we see Marketo, Eloqua and Hubspot. “But we’re the only sales and marketing company that is 100 percent focused on truly small businesses — of which there are 27 million in the US alone,” Mask told me in an interview.
Doug Burgum, founding partner of Arthur Ventures and the executive who led Microsoft’s business applications group, will advise Infusionsoft, Mask said. The company has 350 employees but plans to staff up to more than 1,000 over three years .
This round brings total funding to about $74 million. Other, earlier, investors include Mohr Davidow Ventures and Signal Peak Ventures.
There’s been a lot of talk that chief marketing officers (CMOs) will soon control more IT spending than CIOs. I’m not necessarily buying that contention — especially since many of those stories seem to be written by CMOs, but it’s clear that marketing departments have their own budgets so tech vendors that can speak their language and offer value could do well. As long as that’s the case, don’t expect this category to calm down anytime soon. Feeding that fire, Mask said to stay tuned for an Infusionsoft acquisition in the coming months.