Salsify Grabs $30M to Go Big in Product Content for Digital Retail
Salsify’s founders know what it takes to build a big, successful software company. They previously served in senior roles at Endeca, the enterprise search and e-commerce technology firm that became a pillar company in the Boston tech scene in the 2000s and was acquired by Oracle for over $1 billion in 2011.
Now, they’re attempting to follow in the footsteps of Endeca and, perhaps, turn Salsify into an iconic Boston tech company. Salsify has grown rapidly over the past year, and it will keep its foot on the gas, thanks to an infusion of $30 million from investors that was announced today.
The Series C round was led by Underscore.VC, a Boston venture fund formed last year. The round’s other investors include earlier Salsify backers Venrock, Matrix Partners, and North Bridge Venture Partners. Although Underscore is a new Salsify investor, its co-founder and investing partner Michael Skok previously invested individually in Salsify’s Series B round and led North Bridge’s investment in Salsify’s Series A round when Skok was a general partner at that venture firm.
Purcell, Salsify’s CEO, says in a phone interview that he’s excited about the new funding: “We’re looking forward to growing this thing. It’s going to be a good, long journey.”
Salsify makes cloud-based software that helps brands and retailers manage product content. The idea is to enable product information to flow more smoothly between manufacturers, distributors, and retailers. That helps customers collaborate more effectively, get products to market more quickly, deliver better online shopping experiences for consumers, and ultimately drive more sales, Salsify says.
The approach seems to be bearing fruit. Salsify has partnerships with Walmart and its e-commerce subsidiary Jet, as well as Google, Wayfair, Overstock, and others. Salsify’s customers include major brands such as Coca-Cola, Fruit of the Loom, Rawlings, and Bosch.
Salsify doesn’t share exact sales figures, but it says its annual revenue grew more than 330 percent in 2016. The company has grown from 30 employees at the beginning of 2015 to more than 120 today, almost all of them housed in a new office in downtown Boston. That growth will continue: Salsify plans to hire around 70 to 80 more people this year, Purcell says.
The company says it will also invest in product development and sales and marketing initiatives.
Now that Salsify has relationships with a large network of brands and retailers, it can start to understand how brands are effectively “merchandising” their products, Purcell says. Then it can analyze that performance data and deliver suggestions back to its customers and partners that help them improve their sales tactics. Salsify is also expanding its data science team and developing machine learning tools that might be useful for customers and partners, he adds.
“What we want to go to is a world of real-time merchandising,” Purcell says. He gives an example: a weather forecast for a massive snowstorm in New York might spur a brand to tweak the way it promotes related products through certain retail outlets.
“That sort of stuff is difficult today, but with us enabling fast peer-to-peer collaborations and bringing … insights back, it becomes possible,” Purcell says.
Purcell also hints at ways for Salsify to take advantage of new kinds of technologies that could transform shopping experiences, such as augmented and virtual reality.
“You don’t even know what’s going to be on the radar in five years, but you start to see how product content is going to be so crucial to AR and VR and all kinds of other venues,” he says.
Underscore sees big potential here, too.
“We led this financing round because we are confident Salsify has a world-class technical platform that will scale, and most importantly they have created a culture that will be the foundation for growing an incredible company here in Boston,” Skok said in a prepared statement.
Purcell says the importance of a strong company culture is the biggest lesson he has learned from successful entrepreneurs like Steve Papa, the co-founder and former CEO of Endeca. Purcell admits that talking about culture can be cliché, but “it really does matter.”
“I admired the hell out of what Steve Papa was able to build at Endeca,” Purcell says. “He attracted tremendous talent and [created an] environment where people were aligned. He had an incredibly ambitious vision to go along with that.”
“We’re only at the very beginning of that” at Salsify, he continues. “But the big takeaway for me was [to] think of the kind of people you want to attract, make sure they’re likeminded, and think about the culture and build it from the ground up.”