Quoted Directly From TechCrunch…
By Sarah Perez on September 25, 2013
Rapidly growing mobile events application platform DoubleDutch raised $10 million in Series C funding TechCrunch learned, in an oversubscribed round led in large part by Byron Deeter of Bessemer Venture Partners, who will now join the company’s board. Previous investors from DoubleDutch’s A and B rounds, Floodgate Fund, Bullpen Capital and others also participated.
The funding comes at a time when DoubleDutch has moved to singularly focus on developing its mobile event technology, while abandoning its other products including a fairly popular mobile CRM application known as Hive. When speaking with CEO Lawrence Coburn this morning about the funding, he characterized the decision to shutter Hive as one of the toughest he’s ever had to make – especially considering that previous rounds were raised based on Hive’s promise and potential. Ultimately, however, Coburn said it was the right thing to do.
Hive, which closed this January, had 1,000 or so free customers and a small number of paying users. Meanwhile, the events product had been growing at 40 to 50 percent per quarter, including deployment, users and revenue.
“On the CRM side, we were squarely in Salesforce’s radar,” explains Coburn. “The one thing I couldn’t get my head around was how did our mobile CRM give us a defensible position against Salesforce? Really, it was a beautiful UI [user interface] that sat on top of Salesforce,” he says. “It was a presentation layer over their tech.”
The concern was that if Salesforce decided to focus on this, DoubleDutch could be dead in a year. So Hive closed down, and the business which did have both growth, revenue, and “a similarly sized market with better characteristics,” as Deeter puts it, remains.
A SOCIAL, DATA-DRIVEN EVENTS APP
The DoubleDutch Events application is sold to event organizers as a white label product with a bit of co-branding (“powered by DoubleDutch”), allowing customers to not only transition away from paper-based event guides, but also to do more with the data collected within the mobile technology platform. From a product perspective, the app’s architecture has been built from the ground-up with a focus on social and networking, which differentiates DoubleDutch from some of its competitors.
“Every event has a dedicated activity feed. We have game mechanics deeply built into the app. We have the concept of user profiles and connections – all these things you would expect to see in a social networking platform – are the foundation of our app,” says Coburn. “Every other player in the category, their inspiration was the paper event guide.”
By having an event platform built in this way, DoubleDutch’s app can take advantage of the data it has on hand to do other sorts of things, too. For example, since users have profiles and make connections using the app, DoubleDutch is able to make recommendations of people to follow. It’s also developing a business model around leads data, by transitioning exhibitors away from clunky, hardware-based badge or business card scanners to mobile.
The company’s leads package has been used at over half a dozen events so far, letting exhibitors use a scanning feature in the app that also does real-time scoring around the value of the leads using a variety of signals. This tells the booth rep immediately who they’re talking to, and whether or not they should grab a senior exec, for example. But what’s even more interesting, is that DoubleDutch is able to surface leads of those who didn’t actually come to the booth, as well. To do so, it figures out who may be good leads based on things like who you’ve traded contact info with in the app, what sessions you’ve attended and nearly a dozen other signals.
While pricing for the lead package in an app varies, revenue from this data-based upsell is a multiple from the data made by licensing the app. For instance, at a recent event with 50,000 people and 500 exhibitors, 200 exhibitors bought lead packages at $300 each. That means the customer (the organizer) made $60,000 in revenue just off the data. DoubleDutch takes a revenue share of this data, which it doesn’t disclose.
A SAAS PLATFORM, NOT A THROWAWAY APP
Leads are only the beginning of DoubleDutch’s plans, too. Coburn says that the goal is to make DoubleDutch more of a platform, where its APIs and SDKs allow developers to build other custom features. Deeter adds that there are also huge opportunities for the company to monitor and manage other event-related sales and marketing activity, and tie into communities beyond the event to keep them engaged. “In those two broad buckets, there’s a decade of product roadmap here,” he notes.
While the company isn’t revealing revenue specifics, DoubleDutch is reporting 40 percent quarter-over-quarter growth and nearly 500,000 event participants who have used its apps to date in north of 1,000 events. Its clients have included many big-name brands, including Cisco, American Express, Box, IDG, SAP, PricewaterhouseCoopers, and others. Revenue is “deep in the millions,” and growing well over 100 percent year-over-year.
The event business is a competitive space, with incumbents like QuickMobile to take on, companies like CVENT going public, acquisitions aplenty including EventBrite’s snatching up of Lanyrd, apps building networking tools around the experience (e.g. Bizzabo,Bloodhound, etc.) and several freemium offerings.
But Deeter sees huge potential in what DoubleDutch in particular has on hand. “Paper is just going to go away in that business. The transition over the next couple of years will be massive…there’s no reason to go back,” he says. “It’s a massive market that’s ripe for transition, and DoubleDutch has the opportunity to play in the leadership position right out of the gate.”
With the new funding, the plan is to continue the product development described above, expand to Asia via a Hong Kong office opening this year, transition to a SaaS-based business model, and grow the 62-person team to about 90.
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