CB Insights raises $1.5M, debuts new product for sales teams

CB Insights For Sales uses predictive analytics to help B2B sales teams find new customers

As anyone who writes about tech can tell you, getting information on private companies is not easy to get. Unlike with public companies, where the information is all there, private companies don't have to disclose anything if they don't want to, and for good reason. A few recent leaks for Uber and Snapchat, both showing the companies losing oodles of money last year exemplify who private companies remain so secretive.

That is what has made the information from CB Insights so valuable. It is a private company database that provides real-time information on companies, their investors, their acquirers and the industries they compete.

CB Insights was launched in 2010, but it has not taken any money, until now, revealing on Monday that it has raised $1.15 million from the National Science Foundation. 

So why raise money now? To help the company further its product; in addition to the funding CB Insights also announced the launch of CB Insights For Sales which uses predictive analytics and algorithms to help B2B sales teams find new customers and automate lead generation.

"The roots of CB Insights come from when I used to work in venture capital at American Express with Jonathan Sherry. We want to answer a question that we thought should be simple. At Amex we wanted a list of all the payments companies that had been fudned, but that proved to harder than it should have been," Anand Sanwal, Co-founder and CEO of CB Insights, told me in an interview.

"When we wanted to do own thing, we saw that there was not a good private market product out there. So when we left to found CB Insights out goal was use machine learning to aggregate data on private companies in a  way that hadn't been done before. We wanted to be the Bloomberg for private markets."

While ostensibly built to help out venture capital firms and corporate teams, that CB Insights eventually found was that it was also being used by sales people as well.

"We organically wound up serving that market, with clients such as Marketo, Rackspace and Wakefield. We realized that we had another opportunity to extend what we're doing," said Sanwal. 

Hence the launch of CB Insights For Sales, a product expressly made for these B2B sales teams and takes aim at so-called “spray and pray” B2B lead-generation efforts.

"The key to understanding CBI for Sales is to see how sales people do their jobs today. A big part of a salesperson effort is around finding companies that may be interested in their service. Today that is archaic. They read about a company on Vator, then call them up. The problem is that it sitting back, it's passive. They have wait for an article, and once its on Vator, or on any other publication, there are already 50 others also calling. It's undifferentiated. This method is known as 'spray and pray,' or 'diving for dollars,' among other euphemisms," Sanwal said. 

CB Insights for sales is looking to change that by using a recommendation model. It actually has two recommendation engines that make the process of finding hyper-relevant leads easier for sales people.

The first is the Similar company engine, which means that platform ingests data on the company's existing customers to algorithmically recommend new companies that they should be targeting.

"The logic is easy: you've had success with this customer, so a similar would likely be something you would also find relevant," Sanwal told me.

That, he said, is "filling the top of the funnel with quality leads," which then leads to the second recommendation engine, lead recommenders.

The platform also builds a profile of the client's ideal customer type based on geography, industry, size, momentum signals, such as hiring, news sentiment and new partnerships,  to algorithmically deliver recommendations on companies you should be talking to.

"So if a sales person is interested in companies that are based in Silicon Valley, that are in the payments space, that are Series B funded or hire, and are looking to hire sales people, we can push those out to our clients," said Sanwal.

From there, once CB Insights will alerts clients on relevant leads, and help them prioritize which are the best ones for them, which are growing fastest and which might have more money to spend.

"The nice thing about this product is that we are not building it on a speculative basis. We have customers in B2B sales, like Marketo, who already have customers using us for this, and they were the ones who helped us educate us what would work for B2B sales team," said Sanwal.

"This was driven by listening to them. For example, integrating with Salesforce. We didn't appreciate how important that was, but after talking it over with them, we realized that launching it without a Salesforce integration would be foolish."

The cost of the product scales based on the size of team. On the lowest end it will be $20K a year, but organizations may pay up to six figures, as hundreds of reps will cost more than a smaller company with only 10 reps.

Of course there will be competition in the space, but mostly from inefficient processes, like reading multiple newsletters.

"There are a lot of tools in the sales productivity and intelligence space, but the thing unique about us is we own our own data. A lot of other folks license data from others and try to smash it together. We tried that in the past, but you don't have any sense of the quality of that data," said Sanwal.

"We don't want to make you look foolish, so you call and then come back and say, 'What are you talking about? That didn't happen.' It gives us peace of mind to know we can deliver while not being reliant on third parties."

The new funding that CB Insights has raised will go toward hiring, which Sanwal told me will eventually lead to further product development.

"Specifically with the product its all about making better predictions. We want to go to a B2B sales team, take their existing clients and make better predicts on who they should sell to. That means new inputs, like looking at H-1B visa data to figure out who they should be targeting. Or to see if frequency of Tweets signals health. They may not all work out but these are interesting things to look at."

CB Insights is at 54 employees right now, more than double the 24 it had at end of 2014. It plans to be at 70 by the end of the year. It will be hiring in engineering, with a focus on front end development and machine learning, as well as in marketing and business development.

"The goal for us it to answer the question of 'What's next?' For the sales person what's next means, 'Who is the next customer?' For the VC it's 'What's my next investment.' Or it could be 'Who's my next acquisition?' Or, 'What's the next hot area?'" said Sanwal.

"Today a lot of predictive analytics is a consultant opining on where the world is going. Internal data should trump punditry. The vast majority of the country, and the world, is driven by private companies, but it's horribly opaque. We are going to build a massive Bloomberg-scale business, with a focus on what's happening in private markets."