Jon Miller knows a thing or two about building an enterprise technology Software-as-a-Service (SaaS) company. He's one of the founders of Marketo, the San Mateo, Calif.-based marketing automation provider that plans to sell itself to a private equity investor for $1.79 billion.
Experience helps. Money does, too.
Miller's B2B account-based marketing (ABM) startup Engagio today closed a Series B round of funding worth $22 million. Palo Alto's Norwest Venture Partners led the round with participation from FirstMark Capital and Storm Ventures. Miller said he plans to use the investment for customer success, to scale sales and marketing, and to accelerate product innovation.
Engagio raised $10 million in its first round of funding in April 2015.
Poised to be 'Better than Marketo'
Marketo helped define the marketing automation category and grew to an industry powerhouse in 10 years. Miller believes he can build even more software greatness with Engagio, which is also based in San Mateo.
He's poised to help Engagio pioneer what he calls an "account-based everything" enterprise marketing software space. In account-based everything, marketers target accounts with "fishing spears" rather than "fishing nets" like mass marketing.
And it includes sales and customer-relations management to help marketers and sales teams win and retain accounts.
Engagio, with 26 employees, 50 paying customers and about $30 million in venture capital to date, is farther along than Marketo was at this time in its evolution, Miller told CMSWire. He plans to grow the staff to more than 40 by the end of the year and roughly double that next year.
"I've seen this movie play out at Marketo," Miller said. "I know what it's like to build a SaaS marketing company. We've gotten to 50-customer milestone significantly faster than Marketo did, and frankly with significantly more capital than Marketo did at the same stage. We're definitely set up for a lot of success in terms of momentum to date, and our ability to look forward to the future."
Interest in the ABM Space
Of course, the company won't be alone. Engagio's not the only ABM startup to feature former executives of large enterprise marketing software players. And of course, we all know what Scott Brinker would say if you asked if the marketing technology landscape is packed.
But ABM, beyond email marketing, marketing automation and other digital marketing initiatives, is what's gassing up the marketing grill. Demandbase got $30 million for its ABM platform last year (totaling $90 million now) and partnered with Oracle this year.
Forrester analyst Lori Wizdo told us in March she sees account-based marketing as more of a “keyword” rather than a “market.”
“Vendors,” Wizdo said, “are using the term to badge capabilities ranging from company-targeted advertising to social intelligence to account-centric data management and reporting bolt-ons to core marketing automation systems.”
Wizdo called account-based marketing a strategy more than a technology and added it's "conceivable that ABM automation will develop into a core automation platform — something that replaces a Marketo or Eloqua."
"But I think it's more likely," she said, "that ABM becomes a feature set of core automation platforms, as most B2B marketers will deploy programs under both an ABM strategy, and a traditional persona or lead-based strategy.”
Engagio's lead investor this round, Norwest Venture Partners, is a global, multi-stage venture capital and growth equity investment firm that manages approximately $6 billion in capital and has funded more than 575 companies since inception.
Sean Jacobsohn, partner at Norwest Venture Partners, told CMSWire he's excited about the Engagio team: former Marketo exec Ray Carroll is now vice president of sales. Scott Fehr, VP, customer success (formerly of Eloqua and Oracle Marketing Cloud), Glen Lipka, head of magic and VP product/UX (formerly of Marketo), and Brian Babcock, chief technology officer and co-founder (formerly of Platfora, Rocket Fuel and Adchemy), form the Engagio leadership team.
"It's one of the best teams I've ever seen go after an enterprise cloud play," said Jacobsohn, who's been investing in the enterprise cloud space since 1999. "They not only had great success creating the marketing automation category with Marketo but they're coming back together to do it again. They've got some very unique insights as to where the marketing space is going and have a great opportunity to build a next-generation marketing solution."
Miller, he said, is "clearly a superstar."
"It was a signal to me," Jacobsohn added, "that some of the top people he's worked with in his career want to come work for him again."
Engagio's platform helps companies drive "true ROI," where other enterprise cloud solutions don't. "They have an opportunity to create a massive company here. They've had tremendous sales traction without having a professional sales force. ... There is real resonance in the market for what they're building."
Engagio's platform sits on top of marketing automation platforms and Salesforce. Rather than traditional demand generation that relies on leads that respond to campaigns, Engagio’s account-based platform targets the "most valuable accounts."
Traditional demand generation is “fishing with nets” while Engagio allows “fishing with spears," as Miller puts it.
"In the net world, you don't know which fish you'll catch — you just want to catch enough fish," Miller said. "In the spear world, the right people and right companies come to you and you reach out proactively to them. We're going after larger fish with spears. You use nets to catch smaller fish. The challenge has been up until recently all marketing technology has been only aligned to the net-fishing world."
But targeting accounts with marketing isn't enough in the B2B world. Follow-up, personalized emails, phone calls, social and sales interactions and account-based selling are "just as important."
"That's why we're talking about account-based everything," Miller said. "We’re so excited to focus not just on ABM but on account-based everything, a strategic go-to-market approach that orchestrates personalized marketing, sales and success efforts to land and expand at named accounts.”
Engagio's platform helps engage target accounts, expand customer relationships and deepen sales-and-marketing alignment, according to Engagio customer Patrick Schneidau, chief marketing officer of revenue and profit optimization software provider PROS.
"This category is hot," Miller said. "We've been able to establish ourselves as the thought leader and the company to bet on in this space."
Title image of Engagio's employees courtesy of Engagio.