Doubling Down On the Value of Social Relationships
Today Sprinklr is announcing the availability of a paid media offering as well as a $40M in series D funding led by Iconiq Capital (which notably manages money for many of Facebook’s early employees, among others). With the proliferation of customer data in CRM, eCommerce, web analytics, loyalty programs, and other databases, enterprises have troves of information about their customers. Yet companies often understand customers in the context of their transactions and rarely as individuals.
Without the right context, brands will never be able to build good relationships with customers. Social Relationship Platforms have a tremendous opportunity to help companies build relationships with their customers and fill this gap. This late-stage investment is yet another big sign of maturity for the industry. Carey Lai of Intel Capital, which also participated in this round of Sprinklr’s investment, says in the press release, “The rise of social media has given consumers a platform to engage directly with brands they love like never before. Sprinklr has the capability to capitalize on these fundamental changes in consumer behavior.
This is a big idea whose time has come and represents a significant paradigm shift in the $100 billion enterprise software market.” Investors like Lai are banking on social becoming a cornerstone of customer insight and engagement. Despite considerable consolidation (and as a result fewer relevant vendors) in this space, Sprinklr is not alone in it’s funding or vision for the future.
Several competitors, most notably Spredfast and Hootsuite, have raised substantial funding with a similar vision.* (The various Marketing Clouds are pursuing a similar vision as well, albeit on a broader story line.) Spredfast just announced it’s own series D of $32.5 at the end of 2013. And only a few weeks ago, the company announced it was merging with Mass Relevance to broaden their overall engagement capabilities. Writing about the merger, Spredfast CEO Rod Favaron said, “We’re making it easy for any brand or media company to engage any audiences everywhere in meaningful ways.” Hootsuite raised a massive $165M B round of funding last August.
Ryan Sweeney, Managing Partner of Accel Partners (an early Facebook investor), which participated in the round, said, “We have long believed in the inevitable relevance of social networks and social media at the consumer level. What’s become apparent is that social channels are also becoming THE manner in which small businesses through the Fortune 500 are opting to communicate with their customers and target markets.” As social interactions and customer insights make their way into customer databases, they will increasingly be used to impact customer engagement across channels and help companies build better customer relationships. Achieving this vision is not simple, but certainly valuable—and that makes it worth investing in.
Note: Jeremy Epstein, Sprinklr’s VP of Marketing, disputes that the vision is similar. He says their focus on a single code base and on the enterprise sets them apart. I maintain the vision today is largely the same, although the approach of these vendors has clearly differed. For example, Hootsuite gained brand recognition and traction with a freemium model, and Spredfast has partnered to provide Compliance and Monitoring capabilities. Today they all talk about very similar objectives, though, which the investors of the latest rounds each echo in their comments.