Email is quite profitable, as it turns out. Or rather, email communication software is.
Today, based in Toronto ContactMonkeya platform that allows companies to create, send and track internal communications from Outlook and more, announced that it has raised $55 million in a Series A round led by Updata Partners.
That’s a pretty big round from a single VC, so what warranted the hearty vote of confidence? Maybe ContactMonkey’s profitability — or the fact that the company was bootstrapped until recently.
Updata partner Braden Snyder said in a statement: “As employers continue to look for ways to better engage and retain talent, ContactMonkey fills a key gap in the market with its powerful and user-friendly solution. In the age of remote work, we believe that companies must continue to find ways to better engage with their employees and communicate with them in ways that really resonate. ContactMonkey enhances this type of communication.”
ContactMonkey founder and CEO Scott Pielsticker said the new cash will be used to expand into international markets and double the size of ContactMonkey’s 80-person team, with a particular focus on building ContactMonkey’s sales and marketing organizations.
“Our reason for raising money now is simple,” Pielsticker told TechCrunch in an email interview. “We’re seeing huge demand in the market and around the world for internal email platforms as companies look to improve how they communicate with employees. We believe we are well suited to meet this demand.”
Image Credits: ContactMonkey
Prior to ContactMonkey, Pielsticker started Blueback, a London-based taxi company. ContactMonkey came about after Pielsticker said he saw clear market demand for a platform to help businesses engage employees via email.
“We’ve been on a mission to create a beautiful product for teams to leverage that’s user-friendly and has key data and insights to improve internal communications,” said Pielsticker.
“Beautiful” and “user-friendly” are relative, of course. But ContactMonkey does deliver on the promise of connecting staff – and managers – via email. The platform integrates with Outlook, Gmail or Teams, as well as SMS and HR information systems like Workday and ADP, helping to orchestrate things like announcements, alerts and company updates.
Through engagement analytics, ContactMonkey allows users to create segmented employee lists, collect feedback, and view metrics such as click-through rates, open rates, and read rates.
“Today, there are different ways companies communicate with their employees,” Pielsticker said. “They may be sending emails that don’t have engagement insights, so companies don’t know if employees opened the email — much less if it resonated with them. Or they may use a marketing or sales platform to send emails. These solutions may have some data insights, but they also face problems, from delivery issues to unsubscribe buttons to a lack of enterprise-level security. We provide a third avenue.”
ContactMonkey has about a thousand customers, and Pielsticker says the base is steadily growing. While he admits that ContactMonkey isn’t alone in the market for internal email management (see: Staffbase, Mailchimp), he argues that the investment from Updata puts it in a strong position to fight off challengers.
“Covid-19 has had a positive impact as employers have sought to better communicate with their remote workers and maintain corporate culture. We believe this investment will give us the runway we need to weather any market headwinds — although we don’t see the slowdown in our industry as much as the broader tech industry.
