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The rewards company gets support from new investor Norwest and existing investors
On the heels of releasing its new Dynamic Game Engine and Widget Studio, social rewards and loyalty platform, Badgeville, announced Wednesday that it has raised $12 million in a Series B round of funding led by new investor Norwest Venture Partners, and existing investor El Dorado Ventures, with help from previous investors Trinity Ventures and Webb Investment Network. The new round of funding brings Badgeville’s total raised to $15 million.
When I last spoke with Badgeville CEO Kris Duggan in May, the company was gearing up for the launch of its Dynamic Game Engine and Widget Studio, which Dugan says have been a huge success. At that time, Badgeville had roughly 50 customers and had just completed a seven-figure first quarter. Just a few weeks after that conversation, Badgeville now has over 75 customers and has seen another seven-figure quarter with 40% growth.
To what does Duggan attribute this growth?
“There’s a universal demand in market place for these kinds of capabilities—gamification, social gaming, influencing consumer behavior… Whether you’re a commerce site, community site, enterprise software application, if you have a Web, mobile, or social presence, you need these capabilities.”
Badgeville is getting a real vote of confidence from Norwest’s Tim Chang, who has made some hugely successful investments in Playdom (which was acquired by Disney last summer for nearly $800 million), and Ngmoco (which was acquired by DeNA in October for $400 million). Chang, also world-renowned for his guitar stylings in the hit rock band Coverflow (not quite world-renowned, but getting there), joins Badgeville’s board of directors, along with Tom Peterson of El Dorado Ventures.
So with all the other rewards and gamification platforms out there, why did Badgeville stand out to Chang?
“I’ve been actively speaking about the potential to leverage game mechanics in non-gaming industries for the past couple years, and have been seeking the right investment opportunity in gamification-as-a-SaaS offering,” said Chang. “Badgeville is the clear emerging leader in this space, with the right enterprise-facing approach, business model and flexible platform to easily support a variety of real-world business needs across multiple verticals.”
Badgeville specializes in applying gaming mechanics to traditionally non-gaming industries, like eCommerce. By applying game mechanics to a retail website, you can drive more purchases and more social sharing, which translates to increased traffic and revenue. By 2014, some 70% of all Global 2000 companies will have at least one gamified application, according to Gartner Research.
“This funding means we’re not only the revenue leader, but we’re also the thought leader and the resource leader—we have the most resources at our disposal. In last two years, we’ve raised more money than all of our competitors combined,” said Duggan.
The company is on track to do between $5 and $10 million in sales this year, and Duggan says that he is looking to increase the company’s headcount to 50 by the end of the year (currently, there are 13 open positions at Badgeville). The capital from this round will be put towards hiring, sales, marketing, and product support.
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