This week, sales and marketing software company Infusionsoft announced $54 million in growth capital financing from Goldman Sachs.
Customers use the Infusionsoft online software as a service platform to capture leads online, and follow up and convert those leads to sales. The software includes CRM, email marketing, lead collection and ecommerce capabilities.
In fact, the company intends to be number one in its niche serving this market. “Our mission is to create and dominate the market of all-in-one sales and marketing software for small businesses,” said Infusionsoft CEO and Co-founder Clate Mask.
“All-in-one” is software that performs a variety of functions. It eliminates the need to cobble together an array of single-function tools from various vendors. The more tools from different sources that small businesses need to sign up for, learn to use, figure out how to make them all share data and connect seamlessly — the more time consuming. Deploying one product that performs multiple functions to handle a process end to end, is typically easier and more efficient on a business and the employees who have to learn to use it.
Infusionsoft plans to use the investment funds to invest in and grow its product and presence in the small business market.
The Infusionsoft Customer Target
Infusionsoft’s entire focus is the small business market, and it has a specific sweet spot. Its primary target is the small business that has outgrown the simplest entry-level tools and now needs solutions that are more robust — yet isn’t ready for mid-market or enterprise level solutions.
Mask said: “Of the 27 million small businesses in the U.S., five million fit into Infusionsoft’s target market of small businesses with two to 25 employees. These businesses are owner-operated, lack IT support, follow their buyers online and desperately need effective sales and marketing tools to succeed. Mid-market software and IT support is too expensive and complicated for small businesses, but simple sales and marketing tools can’t effectively manage their growing businesses.”
According to Mask, the company will use the funds to ramp up product development, accelerate marketing and sales, grow its partner program and expand education efforts in the U.S. and internationally. In the process the company will be hiring. It intends to nearly triple its current workforce, bringing it to 1,000 employees over the next three years.
The company reports it had a banner year in 2012, even in the weak economic recovery.
This is the third round of funding for Infusionsoft, which along with two prior rounds totals $71 million. Current investors include Arthur Ventures, Mohr Davidow Ventures and Signal Peak Ventures. Infusionsoft came to outside funding later in its lifecycle, after already proving viability. Initially it was bootstrapped from its launch in 2001 until 2007.
Infusionsoft currently has about 44,000 users in over 12,000 small businesses, located in more than 70 countries. The Chandler, Arizona based company recently moved into a new headquarters and has 350 employees today.