Hubspot Leaving Kendall Square; Next Stop: Lechmere
HubSpot, a fast-growing marketing technology startup born at the Cambridge Innovation Center, will leave its space at One Broadway this summer for new offices at 25 First Street, about 10 city blocks north, Xconomy has learned. While the move will take the startup out of the center of Kendall Square, vice president of marketing Mike Volpe says he hopes HubSpot and its weekly webcast parties will create a new center of gravity for tech entrepreneurs in the Lechmere Square neighborhood of Cambridge, flanking the Cambridgeside Galleria mall.
Call it Kendall Square North. “There are already a few tech companies” at 25 First Street, the building HubSpot will occupy in August, Volpe points out. Zipcar is one; enterprise storage company Permabit is another. “It’s not quite as central to the true heart of Kendall, but finding space for a couple of hundred people is quite an undertaking,” Volpe says.
HubSpot considered moving to a larger space inside One Broadway, and also looked at space in the Tech Square development, Volpe says. “What made the most sense in terms of the layout of the space and the pricing was the First Street space. I think we can make it work—we have people coming every week for HubSpot TV so hopefully we can create a little bit of an attraction ourselves.”
HubSpot’s growth has been rapid. The company started off in 2006 with a single bay on the 14th floor of the Cambridge Innovation Center, the business incubator space that occupies much of the MIT-owned One Broadway building. In January 2009 it moved to the fifth floor, into space that it sublet from RFID startup ThingMagic. But with a current staff of 120, the company is already spilling back out into a few miscellaneous desks at the CIC. To keep growing, the company needed to look elsewhere, Volpe says.
“We expect that by the time we actually move, we’ll have about 150 people, and we’re going to keep growing from there,” Volpe says. “The new space should carry us through for a while—it’s 37,000 square feet, with the potential to take over some more.”
HubSpot has already begun to build out the new space in anticipation of the move, he says. “It’s a very open environment, and we’re going to have a bunch of studio space to do the media production that we do in terms of videos, as well as a big open area in the middle to do podcasting. It’s a really great space, and we’re really excited.”
HubSpot’s Web-based software helps its clients optimize their “inbound marketing” efforts. Inbound marketing is Hubspot’s term for a collection of techniques designed to turn people who visit a company’s website into paying customers. The startup argues that these techniques are more cost-effective than traditional “outbound” marketing such as advertising and direct mail.
Customers apparently agree. HubSpot has 2,300 clients; the October 2009 book Inbound Marketing: Get Found Using Google, Social Media and Blogs, by HubSpot co-founders Brian Halligan and Dharmesh Shah, is selling strongly; and business “is growing at a pretty rapid clip,” Volpe says. “All this hiring we’re doing is not ahead of our revenue curve—it’s because we’ve grown.”
HubSpot’s $16 million Series C venture round in October 2009 brought the company’s total funding to about $33 million. The company can afford to expand to 150 and move into a larger space without increasing the rate at which it’s burning through that money, says Volpe. “We’ve got tons of cash in the bank. All the metrics are moving in the right direction”—which is to say, north.
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