It has been a season of big wins for eRelevance Corporation. Barely a few days ago, the marketing automation ‘messiah’ for SMBs announced the completion of a $5.1 million round of financing. Of course, the latest funding is the result of the company’s phenomenal sales and growth in 2016. However, we wanted to know more about the journey. So, we went a step ahead to ask the pilot himself, who is at the helm at eRelevance — Robert “Bob” Fabbio, Co-founder and CEO.
Here is what played out last evening between Bob and MarTech Series.
MTS: Hi Bob, welcome to MarTech Series. In its second year of selling the Marketing Automation services, eRelevance has managed to register 444% YoY revenue growth, heading towards $4 million in annual recurring revenue (ARR).
How did eRelevance plan this funding round? What are the factors that prompted your investors to believe in your product and company culture?
Bob Fabbio (Bob): Our strategy for the funding started with having plenty of money in the bank and exhibiting great growth. With this a starting point, we planned what our capital needs would be to comfortably reach our next big financial milestone of $10 million in ARR.
Since we have enthusiastic, supportive investors and tremendous success in the market so far with visibility to that next big milestone, it made sense to infuse the business with even more marketing and sales power.
As for our investors, they recognized the breakout performance and potential like ours made us an attractive investment opportunity, so it was a fairly straightforward financing process and ended up being oversubscribed.
MTS: How are you planning to use this newly acquired capital?
Bob: We’re expanding sales and marketing efforts in a significant way, together with advancing our unique and proprietary technology platform to further separate us from everyone else out there.
Making these investments now helps us get to where we’re going faster. The marketing technology space is completely oversaturated, while the SMB market we’re pursuing is ripe and ready for services like ours that make marketing tech simple and affordable.
MTS: You were nominated for the Austin Business Journal’s Best CEO of the Year 2016? Tell us how your contribution as a leader of the martech company helps acquire more funds for the business.
Bob: For me, being the CEO is really about more than just leadership, it also stands for Chief Everything Officer. As anyone on our team will tell you, I try to maintain that “artful” balance of delegating to like-minded people on the team together and when needed I thrive on getting involved with nearly any aspect of the business in great detail.
In my career, I’ve found that a deep appreciation for the details often separates good companies from great ones. As far as how my leadership role helps keep the business well capitalized, I think my past success bringing back large returns on capital to shareholders creates a higher level of confidence in the company and excitement about our potential.
MTS: Are you planning to launch Marketing Automation platform services for bigger companies as well, as part of your growth plans?
Bob: We’ve actually worked with and considered pursuing larger business verticals, however right now, we are getting breakout results in just a slice of the elective healthcare vertical – one of many SMB segments to pursue.
So, we actually see more opportunity to penetrate additional attractive SMB verticals as opposed to working our way upmarket. That said, as an entrepreneur I’ve learned well enough to “never say never”.
MTS: According to you, what are the biggest challenges for a martech firm in 2017 and beyond?
Bob: The biggest challenges in marketing technology right now are a couple of things. First, there’s way too many shiny objects out there. It doesn’t really matter if you support the latest Snapchat feature, have something you can call AI or leverage big data – unless your customers can achieve favorable results that far outweigh the price they pay you.
Secondly, for our particular market segment, we’ve seen clearly that small businesses without marketing teams are simply not in a position to use sophisticated marketing technology on their own. They can only dabble with email or social posting or hire a consultant to do a few other things – at best. Marketing technology, as it’s become more sophisticated is simply too complex and costly for the typical small business.
We’re pioneering solving both of these challenges by bringing the best capabilities of sophisticated customer marketing technology to small businesses via a form factor they can utilize and at a price point, they can afford.
Additionally, we’re obsessed about delivering measurable results to our customers. In other words, we’ve made expensive, big-company marketing tech easy, affordable and effective for small businesses – and that’s what’s made us a successful company so far.
MTS: How do you see newer AI-based and predictive technologies impacting marketing automation services?
Bob: AI and predictive need to do either or both of two things: They need to produce meaningful insight, recommendations or actions that you wouldn’t be able to produce otherwise, or they need to save you a ton of time and/or work producing results.
How important AI and predictive becomes in marketing will be entirely predicated on its ability to either get a better result or get to a great result faster or more automatically. It feels like many companies are now waving around an AI banner as more of a buzzword than anything else.
At a market level though, that latest, greatest thing ultimately needs to deliver a measurable return. And as important for small businesses, it has to be something that assists them in very consumable ways.
MTS: Bob, CheifMartec recently announced that there are 5000 MarTech companies today. That’s a big population for CMOs to consolidate, isn’t it? What is the message you wish to give to CMOs looking to add or upgrade their martech stacks?
Bob: While the vast majority of the small businesses we work with don’t have a chief marketing officer or other marketing staff, there’s one message and question that’s important for anyone considering marketing technology —
Does it actually achieve business results? Can you measure those results and do those results make the cost of the solution (and the effort required to use it) worth it?
In a sea of 5,000+ vendors, my perception is that there are a ton of innovations and very impressive capabilities. But, if the goal is to make your business thrive and grow, the most important consideration should be whether the solution can help that effort in a meaningful and quantifiable way.
MTS: My last question for you, Bob. What was the last marketing event/conference that you attended? Which ones are you attending next in the future?
Bob: I attended the Marketing Nation Summit a few weeks ago. In addition to spending time with other people in the ecosystem, we did field a lot of interest from industry analysts and influencers who are also trying to understand “the expertise gap” experienced by small businesses when they seek out marketing solutions and services.
In all our conversations, we found a broad consensus that small businesses are woefully underserved by our industry so it was great validation for our story and our offering. As far as future marketing events go, I don’t have immediate plans to attend any, but we’re considering potentially hosting a few of our own that cater to the unique challenges of serving small businesses.
MTS: Thank you, Bob, for answering our queries. We look forward to having you again at MTS very soon.