SteelBrick provides configure price quote cloud applications for SMBs and mid-market companies
(Updated with comment from Jules Maltz)
SteelBrick, a provider of next-generation quote-to-cash software applications built on the Salesforce1 platform, wants to solve the problem of giving sales people the insights they need to make sure they are promoting the promoting the right services and offering the best solution for their customers.
The company, which has been growing quickly over the last year, just received a $48 million cash infusion, in a led by Institutional Venture Partners (IVP), with substantial participation from existing investors Emergence Capital, Salesforce Ventures and Shasta Ventures.
This new round brings SteelBrick’s total funding received to more than $78 million in the last 18 months.
Founded in 2006, SteelBrick provides Next Generation Quote-to-Cash apps for SMBs. Their products include SteelBrick Configure Price Quote, which generates sales quotes, proposals, orders and contracts, while SteelBrick Billing manages billing, payments and revenue recognition. SteelBrick Analytics, built on Salesforce Wave, delivers dynamic insights.
"We help companies accelerate the process from quote to cash. For example, we work with Cloudera, which is a big data software company. Before SteelBrick they struggling with manual price processing. They were working from an Excel spreadsheet, manually putting deals together. Working from spreadsheet is inconsistent, with different reps quoting different products and prices," Godard Abel, CEO of SteelBrick, told me in an interview.
Cloudera management didn't have visibility into pricing, and they had to get approvals from their CFO to offer discounts he said, After deploying SteelBrick now they can have all their sales reps generate their own quotations because SteelBrick allows the company to put in its own workflow rules, and will only approve valid price quotes. The pipeline is also automatically updated, giving sales reps up to date information and better visibility.
By using SteelBrick, sales reps are able to save a lot of time that it used to take getting quotes to customers.
"It used to take an hour to put together a quotation, now they can have them out in minutes. Sales people's time is valuable, and its an expensive commodity for a company," Abel said.
It also saves money by allowing sales people, who are doing quotes by spreadsheets, to not accidentally forget items, such as maintenance for support, or a memory card.
"The problem becomes an incorrect quotation, so when the customer orders it and they see they are missing a memory card, often the company that sold it has to eat that cost, since the customer will say, 'I bought it per your quotation, I can't go get more money now.' At the very least you have an upset customer. So there is savings in eliminating errors in the ordering processes," Abel said.
The third big benefit is the control of pricing. When sales people are rushing to get out quotes, they will often make unapproved quotes and discounts, which may be more than the company wants, and that costs money.
"A lot of businesses benefit by making sure pricing is correct. B2B sales can be messy, and control of the process saves money, and companies can be confident that their sales reps are selling the right products at the right price."
While SteelBrick has competitors in the market, including Oracle and SAP, what differentiates it is, first, that it is built on the SalesForce platform, so when a company wants to choose a SalesForce native app, they will typically go with SteelBrick, though there are other choices as well.
The other big differentiator is that the other companies are going after large enterprises, while SteelBrick goes after mid-market companies, of 100 to 2,500 emplyees, and anywhere from 10 to 1,000 sales reps.
"Oracle and SAP are focused on large enterprise customers, like GE with thousands of employees, and it is often a customized solution. SteelBrick is focused on SMBs and mid-market companies who want to go live in weeks rather than many months," Abel said.
"They want something prepackaged, that they can use rght out of the box. So we are going after a different segment. We can get to thousands of customers. Right now we are at 350 customers, and we get to a thousand over the next few years, so we will have more customers than our competitors."
Over the past year, SteelBrick has experienced explosive growth, growing subscription bookings by over 300 percent, expanding its customer base over 200 percent to 350 high-growth customers, and building its global team from 50 to 150 employees.
SteelBrick will use the new funding to continue to grow the team, doubling it to 300 employees over the next one to two years by adding more software engineers, as well as sales and marketing people to spread the word, and service and support to help customer to onboard and run the solution well.
The company will also be going into Europe, following the acquisition of U.K.-based Invoice IT, a provider of cloud software for subscription billing, revenue scheduling, and payment collection, last month.
The acquisition not only allowed SteelBrick to add a billion solution, but it have it a 20 person team in London, which it will use to push to continental Europe, including France, Germany, and Scandaniva.
"For enterprise software that is a more mature market. It's lower hanging fruit, as SalesForce has a big presence in London and Europe. So for 2016 that will be the focus. We already have some in customers in Australia, and we plan to go to Asia the year after, in 2017. That is a more nascent market when it comes to companies buying enterprise software," Abel told me.
In addition to the funding, SteelBrick also announced that Jules Maltz from Institutional Venture Partners (IVP) will join SteelBrick as a Board Observer.
This is an important addition for SteelBrick, Abel said, as it points to the company's future as a potential IPO candidate.
What I like about Jules is that he exclusively invests in hyper growth companies, like DropBox, Slack and Zenefits, which are some of the fastest growing enterprise tech companies out there," said Abel.
“We’re impressed with SteelBrick’s rapid growth, easy-to-implement product, and the large market opportunity in the Quote-to-Cash space. Godard and his management team have done it before at BigMachines and are building something even bigger with SteelBrick," Maltz told me.
Getting IVP on board also means something else big that is coming for the company.
"What is unique about IVP is that they have 104 IPOs out of 300 investments. That's as high a ratio as I know of, and since I expect us to go public one day, IVP will help us do that by allowing us to tap into their experience and network," said Abel.
An IPO won't happen for a couple of years, at least, but that is the ultimate goal for SteelBrick.
"We have more than enough funding to get us there now, and the reason it is important to us is, first as entrepreneur it is my dream to ring the bell, but also once you take on VC investors, you have to give them a return," Abel told me.
"You either take it public or sell it. We sold out previous company, BigMachines, to Oracle. That was a good exit, but we'd rather take it all the way this time. It's the best way to give investors liquidity, but there's also a team that is working hard building this company. An IPO allows them to cash in shares if they'd like to. In my mind it is the preferred outcome. Selling was more sudden, and with an IPO they can make their own choice."
“IVP loves backing late-stage companies that have the potential to grow into lasting, public companies. We had the 103 IPO in our history last week with Pure Storage and we look forward to working with many other businesses, like SteelBrick, to help them build future public companies," said Maltz.
The attitude of looking out for his employees feed into the type of work environment Abel is striving to create at SteelBrick, which was inspired by WorkDay.
"We want to have the same positive culture, where employees are inspired and the customer feels like we really care, and so they become evangelists. Scalng that caring culture is a big part of my vision for the company. I know it's a long journey, so I want us to enjoy working with each other and with customers. We spend so much time working, we might as well make life better."
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With $7 billion of committed capital, IVP is one of the premier later-stage venture capital and growth equity firms in the United States. Founded in 1980, IVP has invested in over 300 companies, 106 of which have gone public. IVP is one of the top-performing firms in the industry and has a 36-year IRR of 43.2%. IVP specializes in venture growth investments, industry rollups, founder liquidity transactions, and select public market investments. IVP investments include such notable companies as AppDynamics (CSCO), Business Insider (Axel Springer), Buddy Media (CRM), Casper, Compass, Datalogix (ORCL), Domo, Dropbox, Dropcam (GOOG), Fleetmatics (FLTX), GitHub, HomeAway (AWAY), The Honest Company, Kayak (PCLN), Klarna, LegalZoom, LifeLock (LOCK), Marketo (MKTO), Mindbody (MB), MySQL (ORCL), Netflix (NFLX), Omniture (ADBE), Personal Capital, Pure Storage (PSTG), Slack, Snap (SNAP), SoFi, Supercell (SoftBank), Tanium, Twitter (TWTR), Yext (YEXT), ZipRecruiter, and Zynga (ZNGA). For more information, visit www.ivp.com or follow IVP on Twitter: @ivp.
Joined Vator onJules Maltz is a General Partner at IVP and led IVP's investments in Buddy Media (CRM), Checkr, Dropbox, Indiegogo, NerdWallet, Oportun, RetailMeNot (SALE), Slack, SteelBrick, TuneIn, Zendesk (ZEN), and Zenefits