Buddy Media, which has emerged as the dominant marketing platform for major brands on Facebook, just closed a $54 million D round led by GGV Capital, Insight Venture Partners, Institutional Venture Partners and Bay Partners.
It’s clear Mr. Lazerow has an IPO as his end goal. He writes in a blog post that GGV has experience with the public markets, having backed companies like Alibaba and more recently Pandora, which went public just before the recent market downturn. And Bay Partners, he notes, have seen more than 250 companies to an IPO or $250 million+ acquisition. Here’s our quick Q&A from this morning:
Q: Why raise such a big round now?
A: What this means is that no matter what happens in the markets or the macro-economic picture, we can scale the company aggressively. We are cash flow positive and none of this funding is going to pay back investors or employees. This is pure growth capital.
Q: Is this the first step on a road to an IPO?
A: No doubt the profile of these investors lends itself to being a public company, but that is just one option on the table, and we are not ruling anything out.
Q: Are you looking to take advantage of an overcrowded start-up ecosystem, especially at the early stage, to snap up some good companies, a la Spinback.
A: We definitely witnessed the rise of the seed investor over the last year or so. Everyone was an angel. That meant there were a lot of companies created, but its hard, once you have that business, to scale, market and monetize. We’re not just going to start rolling up start-ups, but we do have the infrastructure in place to make thing work very well when we find a company, like Spinback, who’s team and technology are a great fit with our business.
As Lazerow wrote in his blog post this morning:
“We are in the midst of a massive shift online from a search and intent-based world to a social, people-based world. The last three years were about the consumer side of social platforms, as we watched Facebook, Zynga and Twitter grow exponentially,” writes Mr. Lazerow. “The next three years will about the enterprise side of social, and how companies engage and grow their businesses by tapping into these massive platforms. Buddy Media plans to help accelerate this movement by providing our clients easy-to-use and powerful tools to help them tap into these social platforms to increase revenues, find new customers, and build deeper relationships with current customers and more.”
Interestingly, all of the money being raised is going directly into the company (versus being used to buy out existing shareholders). Buddy Media plans to double our product, sales and support staff in the next year as well as fund additional global offices and acquisitions.
Lazerow runs down some of the company highlights from just the last year:
- We added close to 200 new customers in 2011, including some of the world’s most recognizable global brands, retailers and media companies such as Ford Motor Company, Hanes, ESPN, Hearst Corporation, and Virgin Mobile USA.
- Our revenue has more than doubled since the end of 2010.
- We’ve maintained a net promoter score of 75 in 2011.
- Employee headcount has grown from 40 employees in 2009 to almost 200, with continued massive hiring plans for 2011 and beyond.
- We acquired social commerce and analytics leader Spinback in May 2011 and plans to complete its integration and roll out this month (a record for integration!).
- We recently hired Dennis Morgan as Chief Financial Officer. While at Yahoo!, Morgan led corporate finance efforts for more than $5 billion in acquisitions and business development deals .
- We opened our European Headquarters in London last month and hired Luca Benini, a senior executive from Comscore, as Managing Director, Europe.
- We won the TechCrunch “Crunchie” Award for Best Enterprise application in January 2011.
- WPP, the world’s largest communications services group, announced a $5 million investment and global partnership with Buddy Media in October 2010.
For better or worse what this means is that Buddy Media will be in a position to acquire more New York based ad-tech and social media start-ups during the coming seed stage slaughter. We’ll check in with Spinback’s Andrew Ferenci later this week and see how he’s liking the big company life.