Demandbase, provider of a B2B account-based marketing (ABM) platform, closed $65 million in its latest funding round today. This round brings the San Francisco-based company's total funding to $150 million.
Chris Golec, Demandbase CEO, told CMSWire the company plans to continue its innovations in Artificial Intelligence (AI) throughout its ABM platform. Its investment in AI stems from its acquisition of data science company Spiderbook one year ago.
The company also plans to hire data scientists with the new funding.
AI Meets ABM
"People are trying to get their arms around AI and how it applies to their marketing stack," Golec said. "There are a lot of theories out there, but we're starting to see people putting it into action. This new investment is a huge opportunity to take what we're doing with Spiderbook and all of our different proprietary data that we have and accelerate that data around AI and apply it to ABM."
Demandbase's $65 million funding features investments from new investor Silver Lake Waterman, Silver Lake’s late stage growth capital fund, and existing investors Adobe Systems, Altos Ventures, Greenspring Associates, Sageview Capital, Scale Venture Partners and Sigma Partners.
Demandbase's ABM engine pairs machine learning algorithms with its B2B data to provide ABM solutions that can "identify every B2B company in the world, map relationships between companies, generate useful insights, and deliver the right content to the right companies."
Why ABM and Why Now?
The investment in Demandbase signals another commitment to ABM platforms. B2B research and advisory firm SiriusDecisions in its 2016 State of Account-Based Marketing (ABM) study said ABM adoption grew 100 percent in 2016 over 2015.
Golec said the investment community's "ears have perked" and that his company received a "ton of inbound interest" at the beginning of this year.
Todd Berkowitz, research vice president at Gartner who focuses on B2B marketing and sales technology, told CMSWire targeting large B2B accounts is "getting harder and harder."
He cited bigger buying teams, competing priorities and better educated buyers. Demand generation and prospecting marketing techniques — email click through rates or form fills, for example — are now less effective.
"ABM," Berkowitz said, "becomes a really good approach to addressing this problem."
Marketers can better target accounts (via IP address) and individuals (via cookies) in ABM platforms, the analyst added. New tools to orchestrate multichannel programs, match leads to accounts and measure engagement across accounts help target net new prospects at scale.
"And then we’ve seen significant improvements in data science and machine learning to select accounts and fill in gaps around who in the accounts to target — and why," Berkowitz said. "It’s the ABM at scale that has really fueled the growth for ABM technology and services via the likes of Demandbase, Engagio and others. So you kind of have this perfect storm."
He cautioned ABM can be "very complicated and time-consuming up front, but the ROI is often very compelling once the programs are fully operational."
Niche ABM Offerings
Vendors in the space still have their niche. No one yet offers the single platform that does everything, Berkowitz said.
"You still have a set of vendors that largely cover engagement — ads, retargeting, web personalization — others than handle lead management and reporting, others than provide information/models to select accounts and identify who in those accounts to target, others than handle attribution and then some that are ABM versions of sales acceleration platforms," Berkowitz said.
Marketing automation vendors add some of those capabilities, to a varying degree.
"For the most part, the vendors are providing real solutions with real practical appeal to them," Berkowitz said. "As the mega-vendors in the CRM and marketing automation world add capabilities, you may see more long-term vision and less in the way of short-term deliverables. But that isn’t something that plagues the ABM pure plays."