Costello Raises $2.1M to Accommodate Growing Customer Demand
Costello, the Indianapolis-based software startup, this week announced that it has raised $2.1 million in seed funding. A number of local and out-of-state investors contributed to the round, including Dundee Ventures, Collina Ventures, Silicon Valley’s Social Capital, Copper Mountain Technologies CEO Irena Goloschokin, and ExactTarget co-founder Chris Baggott.
Costello’s software brings artificial intelligence to the deal management process. Companies use Costello’s product—which can be integrated with other platforms like Google Calendar, Gmail, and Salesforce (NYSE: CRM)—to help their salespeople research potential leads, structure conversations, compose questions to ask, and track multiple deals from start to close.
After finishing a sales call, reps can follow up by accessing relevant marketing materials and syncing their notes back into their customer management relationship software. Costello also offers users real-time suggestions for improved interactions with decision-makers.
Frank Dale, Costello’s CEO, says the company has been moving fast since it launched last year. “We’ve grown significantly,” he adds. “Last month, we brought on our first Fortune 50 client, and we’ve more than doubled the team to keep up with demand. It’s a good time to be in this business.”
Dale says the software industry has changed in the past decade due to what he calls “complicated dynamics” that are influenced by people’s expectations that office technologies will offer the same intuitive functionality as the consumer software they’re used to using at home.
Because of the rise of Amazon Web Services and other digital infrastructure providers, it’s easier and cheaper to get a software business up and running these days, Dale continues. That’s made developers more effective, but it’s also led to an abundance of software in the marketplace, which can make differentiating one’s product especially challenging. Dale says the industry is also dealing with a shift in which customer experience is key.
“It’s made it easier to get software products out, but even if there are no direct competitors, the market is flooded,” he explains. “There’s a lot more noise, and the minimum bar to get traction now is higher. One reason people buy our software is to cut through the clutter. You get one shot [with prospective buyers] today because buyer expectations are so high and they have so many options.”
When customers go to Amazon (NASDAQ: AMZN) to buy a book, they’ll see tailored offers and other relevant information based on past activity. Dale says that kind of customization is starting to show up in business-to-business software too. Buyers have all kinds of research tools and product review websites they can use to investigate potential software purchases before they even take a meeting with salespeople.
“By the time you show up for the sales conversation, buyers are coming from a more informed place with high expectations,” Dale says. “If the salesperson is not an expert or can’t tailor the conversation to the buyer’s specific needs, the call is over. In the past, salespeople would get on the phone and wing it, but you can’t do that anymore. We exist to help salespeople meet the expectations of buyers.”
The 11-person company plans to use its new capital to build additional integrations with HubSpot (NYSE: HUBS) and other platforms, add more insight data, and start delivering the most pertinent data points to salespeople so they know what the potential consequences would be if they were overlooked during their pitch.
One strategy Costello uses to encourage excellent customer service is to have every employee—from engineers to marketers to Dale himself—talk to customers to find out their experiences with Costello’s software.
“We have them take support calls because it gives them empathy and drives them to come up with better solutions,” Dale says. “They interview salespeople to find out what they want. Most companies pay lip service to this idea, but they won’t do it because it requires you to be pretty humble. We’ve gotten early traction and that’s exciting because we’re trying to build one of the world’s great customer-focused companies.”