When Sagetap founders Sahil Khanna and Kevin Hughes started working in early-stage software startups, they were surprised to find that the companies they were working for were trying to sell their innovative technology through old methods like repetitive cold emails and calls.
Khanna, a former product marketer, and Hughes, a former sales manager, knew these methods weren’t effective either at selling software or helping buyers find the solution they needed. They decided to try to build a better way.
“The company executives are frustrated, their email is broken,” Khanna, CEO of Sagetap, told TechCrunch. “In their own words, there are too many vendors to keep track of. They don’t know who is trustworthy.” For context, there are nearly 400 enterprise tech unicorns alone and countless other smaller startups, according to CB Insights.
Khanna and Hughes released Sagetap to try to fix these issues. Sagetap spent the first year of its life as a platform designed to give shoppers a place to research and explore options. The company achieved $1 million in ARR with that strategy, Khanna said, but decided Sagetap was more than just a place for buyers to gather information.
So Sagetap built a marketplace with AI on top of research. Today, potential customers can browse Sagetap’s database of software vendors, both of whom have been verified to be on the platform, and pay a subscription fee to stay on the list. For each supplier, buyers can access information including publicly available information, purchase prices and anonymous feedback and information derived by Sagetap’s AI from sales calls made through the platform. The marketplace uses artificial intelligence to rank its suppliers and suggest options to its users, matching them with companies that match their criteria.
“This industry is huge, it’s a $1 trillion business,” Khanna said. “It’s broken. Buyers and sellers, there’s a lot of friction. We looked at what’s going on with Uber and Airbnb that brought incredible efficiency [through] a market and thought that this would happen to the sales of the business [industry].”
The San Francisco-based company says it’s profitable, making money through vendor subscriptions and meetings booked on the platform, and this month announced a $6.8 million seed round led by NFX with participation from VCs including Uncorrelated Ventures and Emergent Ventures. The round also included 15 of their customers, including Oracle, Dell, SecureFrame and Descope, who were the drivers behind the round in the beginning.
“Initially we weren’t going out for funding,” Khanna said. “This was started by our own customers. We had a bunch of tech guys ask to invest and we decided to open it up.”
Enterprise software spans several different categories, and Khanna said Sagetap started with the areas buyers are most interested in right now, including cybersecurity, AI infrastructure and developers.
While Sagetap isn’t the first enterprise software marketplace, and large organizations like AWS host theirs, Sagetap believes it stands out because of the way it uses artificial intelligence to analyze its sales calls for its recommendations.
Since the AI renaissance really started to take off in 2022, many companies have set out to improve their enterprise software sales process with AI. However, many of them are focused on the seller and do not offer a new model, but simply automate an aspect of the existing one, whether it is using genetic artificial intelligence to create promotional emails or using technology for better sales prospects. What Sagetap does actually looks and feels different.
Khanna said they get a lot of inbound pitches from VCs who want to make it easier for people to find their portfolio companies. This suggests that the platform could be useful as a way for software startups to market themselves to large buyers who would otherwise ignore them. While good for visibility, in many ways this strategy is like pay-to-play. Sagetap makes sure to only allow suppliers on the platform that they have vetted for things like customer engagement, funding and market pull, but 73% of the suppliers they have approached are allowed to be listed.
But buyers seem happy. Sagetap has grown to 5,000 buyers over the past five years with revenue growing 2.7x year over year.
“The engine is running,” Hannah said. “We’re seeing really strong growth. The next year is really about growing the community of tech experts, increasing our visibility in the market and doubling down.”
