Pendo helps businesses understand and assist their customers with tools like analytics, polls and walkthroughs. Until now, however, CEO Todd Olson said the company has been focused on the web (both desktop and mobile), with just a single mobile developer on the team.
“We as a team constantly had a lot of internal debates about how much to invest in [mobile],” he said. “If you want to do it, you have to really invest in it.”
That’s why the company has made its first acquisition — it’s buying Insert, a mobile marketing startup based in Israel. Olson told me that he connected with Insert through Battery Ventures, which backed both companies, and he saw their product as doing “essentially what we do, but for mobile devices.”
There are some differences, he acknowledged, since Insert is more focused on mobile messaging and less on analytics. But in Olson’s view, the Insert team has already done “all the hard work” of creating a platform that marketers and product designers can use, and integrating that product with native mobile apps.
“The key is doing it without developers,” he said. So with Insert, Pendo can build a platform that allows teams to engage with customers and improve their product across devices, and to do so without developer assistance: “The vision is to combine the products into one simple platform.”
Pendo, an up-and-coming software startup that raised $20 million in venture capital funding in December, plans to expand its staff by roughly 50 percent after raising an additional $25 million from investors.
Co-founder and CEO Todd Pendo said that the company, which is headquartered in downtown Raleigh and has 106 workers, expects to add more than 50 new hires over the next six months. In addition, Pendo also will use the funding to shop for acquisitions that could accelerate its growth.
Pendo’s cloud-based technology helps business customers improve their software by providing feedback on what features their customers are using and which ones they’re ignoring It also issues pop-up messages to software users notifying them of features they may not know about.
“Our focus is helping our customers create great customer experiences,” Olsen said.
The privately held company reports that revenue from hundreds of software customers such as Citrix and Gainsight more than quadrupled last year.
According to the investor fueling Pendo’s $25 million Series C, announced today, the four-year-old product management software startup from Raleigh is “one of the best late stage tech companies in the universe.”
From its website, Meritech Capital Partners of Palo Alto is pretty clear about its ambitions. It’s not looking for seed deals or raising billion plus dollar funds. The fund run by six partners all with deep experience running companies or in investment banking wants only to place bets on companies it believes can have the next big technology IPO.
That means the team works fast to get its money in the right place.
So fast, that negotiations with Pendo began around the first week in June, when I shared a cab with Pendo CEO Todd Olson on our way to the 3686 South conference in Nashville.
While Olson didn’t share any specifics around his fundraising efforts, he made it pretty clear that raising capital was no problem and in fact, it’s coming in even faster than planned.
RALEIGH, NC – (Marketwire – July 13, 2017) – Pendo today announced it has raised $25 million in Series C financing led by Meritech Capital Partners. The round includes additional participation from existing investors Battery Ventures, Contour Venture Partners, Core Capital Partners, IDEAFund Partners, Salesforce Ventures and Spark Capital. In addition, Meritech Capital Partners’ General Partner Rob Ward will join Pendo’s board of directors. Pendo has raised $56 million to date — $45 million in the last six months.
Pendo is a platform that helps companies deliver exceptional customer experiences in their products. In 2016, Pendo’s revenues more than quadrupled and its customer base grew to hundreds of leading software companies including Citrix, Coupa, Gainsight, Henry Schein, Infor and Optimizely. Pendo now tracks over 20 billion user actions and improves the product experience of over 22 million users every month.
The new funding will be used to scale Pendo’s engineering team as well as make strategic investments to accelerate growth. Additionally, Pendo is announcing new offices in New York and San Francisco to better serve its customer base.
“In the past decade we’ve seen software disrupt and transform industries and job roles over and over again. Today, all successful companies need to be in the software business, and all of them need to care about their product experience,” said Meritech General Partner Rob Ward. “At Meritech we seek category-defining companies, and Pendo is well on its way to becoming a market leader as evidenced by its fast growth and incredibly enthusiastic customers.”
“Our software has to serve a number of different roles in each practice,” said Bradley LaFave, Product Marketing Manager at WebPT, an electronic medical record (EMR) platform for the physical therapy industry. “As a SaaS product without contracts, we have to show value everyday to our Members to maintain our over 99% retention rate. This is where Pendo comes in. Pendo helps us truly understand and improve the experience we deliver to each of the different roles in our product. It should be an essential part of every company’s technology infrastructure.”
“Experience is no longer a nice-to-have for software products, we see an enormous opportunity to help companies improve their product experiences,” said Todd Olson, Chief Executive Officer at Pendo. “We are excited to partner with Meritech Capital Partners who will enable us to invest more aggressively and realize our potential.”
Pendo was founded in 2013 by former product managers that have experienced the joys and challenges of creating great products at companies like Cisco, Google, Rally, and Red Hat, among others. With a powerful analytics and guidance platform designed to help companies understand and influence how users interact with their software applications, Pendo is on a mission to improve society’s experiences with software. For more information, visit: www.pendo.io.
About Meritech Capital Partners
Meritech Capital Partners is a leading provider of growth stage venture capital to category-defining private technology companies, and has been one of the top performing venture firms of the past two decades. With over $3 billion under management, Meritech primarily leads investments into companies with proven and differentiated technology, rapidly-growing revenue and experienced management teams. Meritech investments in industry-leading companies include Alteryx, Anaplan, Box, Cloudera, Coupa, Datadog, Facebook, Fortinet, Fusion-io, Greenplum, Hybris, Looker, Mulesoft, Netezza, NetSuite, Proofpoint, PopCap, Riverbed, Roblox, Snap, Tableau and Zulily. Meritech is located in Palo Alto, CA and can be found at www.meritechcapital.com.
Salesforce is the fastest growing top five enterprise software company and the #1 CRM provider globally. Salesforce Ventures—the company’s corporate investment group—invests in the next generation of enterprise technology that extends the power of the Salesforce Intelligent Customer Success Platform, helping companies connect with their customers in entirely new ways. Portfolio companies receive funding as well as access to the world’s largest cloud ecosystem and the guidance of Salesforce’s innovators and executives. With Salesforce Ventures, portfolio companies can also leverage Salesforce’s expertise in corporate philanthropy by joining Pledge 1% to make giving back part of their business model. Salesforce Ventures has invested in more than 200 enterprise cloud startups in 14 different countries since 2009. For more information, please visit www.salesforce.com/ventures
Just seven months after announcing a $20 million Series B, Pendo, a platform to help businesses better understand their customers, has closed a new $25 million Series C led by Meritech Capital Partners. The North Carolina-based startup has been growing at a rapid clip — ballooning to 106 employees across offices in San Francisco, New York and Raleigh. Meritech’s Rob Ward will be joining the Pendo board of directors to help guide future acquisitions and an international expansion strategy.
Pendo is a tool that companies can use to track key customer metrics to better understand how users engage with products and services. The company is orienting itself around the rise in interest in satisfaction metrics like net promoter scores (likelihood to recommend products to others) that often are used as a proxy for projecting revenue.
IFP Portfolio Company Pendo recently closed an $11 million Series A, one of the largest in recent NC VC tech history. Investors in the round included Salesforce and Battery Ventures.
Pendo CEO Todd Olson has been an active entrepreneur for years, starting his first company in the late 1990s while a student at Carnegie Mellon and raising $17 million for its development. His next company, 6th Sense Analytics, was sold to Rally Software in 2008. After a few years with Rally, Olson left his position as VP of Products following the company’s 2013 IPO.
Since then, he’s spent his time starting Pendo. In just a few years, the company has grown its SaaS customer base to over 60. And since January 2014, revenue has been increasing by 30% per month. When asked, IFP Managing Partner Lister Delgado commented “Rarely do you see a team of people who have done this before and know what they need to do (…). This is one of the best companies in the Triangle.”
Pendo is recognized in the Triangle Business Journal for the successful fundraising of $1.25M to expand the team. Todd Olson credits his team’s execution for the successful raise. Pendo has created a program that enables interactive messaging within their software products. Olson says, “It’s never easy to raise cash in North Carolina. We have a great early investor team who’s incredibly supportive. We as a team have managed to execute the objective we laid out.”
Todd Olson and his co-founders have kept a low profile and quietly built their team and product. The team has built the first software platform designed specifically for product managers– an area in which the team has first-hand experience. Compiling and analyzing data on how customers interact and use features, the platform helps product managers build more engaging software. The company recently emerged from stealth mode, announcing 35 SaaS customers and $1M in funding.
Read the full article from ExitEvent and view the full interview below
Pendo, a product engagement firm, recently received $1.025 million in seed funding. The round included prominent investors such as Core Capital Partners, Contour Venture Partners, IDEA Fund Partners, and Brent Queener, former EVP of Salesforce.com.
Read the full story and Pendo’s press release from PE HUB