Yesterday our investment in InsideSales.com was made public.
SaaS is the prevailing theme in Polaris’ technology portfolio, and the world that I personally work in on a daily basis.
The Consumerization of IT — and with it, re-innovation of the sales and marketing industry demands that the next generation of great, transformative sales & marketing automation companies be built.
This next generation will arm the high-velocity, low-touch selling models — and the data-driven, growth-hacking, customer acquisition marketing models which are disrupting the industry.
We’re big believers that business model disruption can be as compelling as technology disruption.
The explosion of Inside Selling has disrupted the Sales industry. It’s transformed the way companies sell their products to enterprises.
It’s the new enterprise sales model.
But this new model has exploded without a purpose-built platform to optimize productivity and accelerate the time to close business.
InsideSales.com’s platform not only manages this process, but its learning engine and algorithmic approaches bring intelligence that dramatically increases the ability to close customers.
They exhibit the rare combination of enabling business model transformation by means of truly disruptive technology.
Two years ago, “the lines crossed” with regard to worldwide Inside Sales headcount, as compared to Outside Sales headcount.
InsideSales.com’s sales acceleration platform brings visibility, automation, and intelligence to the inside sales process — for which time, productivity and measurability are of the essence.
The science of predictive analytics stands to be one of the most impactful technology trends of the next decade. InsideSales.com differentiates itself from other sales & marketing technologies by combining
- industry-leading predictive analytics, with
- inside sales individual and management best practices, with
- advanced and patented approaches to machine learning and cognition.
Having led large sales organizations early in my career, I can say first-hand that never-ending challenges with Inside Sales Teams center around shortening productivity ramps, managing personnel retention and churn, and providing guided selling coaching and processes that are consistent, transferable and above all — measurable.
Within our own portfolio of 40 SaaS companies, those that have adopted InsideSales’ platform have averaged 3X improvements in funnel optimization, 60%+ improvement in new rep productivity, and 30%+ increases in sales close rates.
All of this summarizes the underlying context behind our enthusiasm for InsideSales.com’s opportunity to build a multi-billion dollar company.
As outlined in the WSJ and TechCrunch articles which appeared yesterday, once in a while, a company has an opportunity to truly transform an entire industry.
We believe InsideSales.com is that kind of company.
Our funding round validates the groundbreaking 2014 Sales Acceleration Technology Market Size Study, which indicates that North American companies already spend $12.8 billion annually on sales acceleration technology — with a heavy emphasis on sales communications and intelligence. And the market is growing. SaaS is a nearly $40B addressable market, compounding nearly 30%. The study estimates that North American businesses could spend in excess of $30 billion on sales acceleration technology by 2017.
Dave Elkington, ISDC’s co-founder and CEO, outlined their “unfair advantage”:
Customers, partners and investors frequently ask us what our secret sauce is. Our secret sauce is our scientific approach to sales. We use data as a strategic weapon to systematically improve sales performance and drive sales growth for our own company and for customers who want to maximize revenue growth.InsideSales.com is analyzing millions of anonymized sales transactions and leveraging this data in ways no other company has ever imagined. This additional $100 million in financing, which brings our total funding to $140 million, will enable InsideSales.com to continue improving and expanding its patented sales acceleration technology to better serve its valued customers and partners.
In a nutshell, like any investment, there are several basic factors which guide our conviction as investors. Included in the basics here :
- Market Size & Timing: as noted above, this a special moment to transform a gigantic industry.
- People: Dave and his co-Founder and President, Ken Krogue, are truly complementary visionaries and thought leaders. Dave’s thought leadership centers on
- Data Science, Ken’s on the practices of all things Sales. They’ve attracted a truly world-class management team with been-there, done-that entrepreneurial and management experience in scaling companies likesalesforce.com, VMware, Citrix and Infor to industry leadership. Beyond strong investment, they’ve attracted a world-class and special team of Advisors.
- Technology: As is the case with most truly-special SaaS companies, their key asset centers around data, predictive analytics, and workflow solutions. They use data as a strategic weapon to systematically improve sales performance and drive growth. It’s hard to find a more compelling value proposition.
- Incredibly-innovative algorithms, machine learning and predictive analytics, paired with cognitive learning technology, amplified by a truly-unique level of domain expertise. So, it’s also hard to find stronger long-view differentiation.
- Execution: Beyond top-line growth, the company’s sales operating metrics and economics are among the very best I have ever seen in the software industry.
- Philosophy: The day I met Dave, I instinctively aligned with how he views his opportunity, how he’s building both his company and a very special culture, his commitment to giving back to community, and how he partners. It’s safe to say we both found a partner with shared core values and beliefs, complementary experiences, and shared enthusiasm for the vision as well as the journey.
My Polaris Partners and I could not be more stoked to help Dave, Ken and their team achieve their goals.