Zipwhip Continues Business Texting Push With $22.5M in New Funding
How many texts did you send today? And how many did you send to a business? Whatever the number, Zipwhip and the investors who just poured another $22.5 million into the Seattle company are betting you’ll be sending more—and they’re not alone.
Zipwhip makes software that allows businesses to better communicate with customers via text message using their existing phone numbers, including toll-free numbers, and VoIP (Voice over Internet Protocol) systems.
Lead investor OpenView was joined by Zipwhip’s prior backers, Voyager Capital and Microsoft Ventures, in the Series C funding round, bringing the total invested in the nearly 10-year-old company to $41.5 million. OpenView founder Scott Maxwell joins Zipwhip’s board with the investment.
As evidence of the market demand for business text messaging, the company touts its own growth—a 60 percent increase in monthly recurring revenue since last October and more than 100 new hires—and cites moves by major tech companies including Google and Apple. The former has integrated text messaging capabilities into its advertising platform, AdWords, and the latter is expected to launch a business chat service soon, according to Zipwhip.
You could also view the escalating interest in chatbots and virtual assistants through this lens: Companies are investing heavily in technology that automates text-based conversations with their users for fun and, perhaps eventually, profit.
“Texting is only becoming more ubiquitous in the U.S.,” says John Larson, Zipwhip’s co-founder and chief of business development, via e-mail. (I suppose we should have texted in our questions.)
He says the company decided to raise more capital now to grow faster, and because of inbound investor interest, “and the valuations were respectable.”
Zipwhip has grown to 170 employees and plans to double in size over the next 18 months. Much of the growth will be in sales and marketing, Larson says. He adds, “The market largely still doesn’t know that they can add texting to their existing business phone numbers under within 10 minutes of signing up for Zipwhip.”
The company also plans to continue developing its technology, integrating it with other pieces of business software, such as customer relationship management tools.