Venture Capital: Gong Secures Unicorn Status With $200M Series D
The revenue intelligence startup didn’t need the money but raised it anyway.
Gong, the startup which helps businesses glean “revenue intelligence” from customer interactions, achieved unicorn status when it raised $200 million at a valuation of $2.2 billion. Coatue led the Series D round, with participation from Index Ventures, Thrive Capital, and Salesforce Ventures. Existing investors NextWorld Capital, Battery Ventures, Norwest Venture Partners, Sequoia Capital, and Wing Venture Capital also invested. (Forbes)
Investors appear to be charmed with the prospects of the company, given the ridiculously easy way it picks up funding. Gong raised $40 million in February 2019, then $65 million in December and now another $200 million. This when it still has money left over from the December funding.
Investors chasing growth
The virus pandemic has proved to be a bonanza for Gong’s business, with revenues growing three-fold in the first half of 2020. At the current rate, the startup is on track to dial-up revenues of $50 million for the full year, up from about $20 million in 2019.
The pandemic has turned traditional selling on its head. Sales teams now have to do their selling using online methods. Sales reps are learning to build their marketing and customer relationships online. Scattered sales networks are now seeking cohesion and intelligence from a centralized platform and Gong filled the breach perfectly.
The new normal was not lost on investors – they wanted in, and ahead, of a potential IPO from Gong.
Though Gong founders CEO Amit Bendov and CTO Eilon Reshef were not looking to raise money, it was hard to say no. When firms come knocking with checkbooks open and favorable terms, he was not about to turn them down, Bendov told TechCrunch.
“It’s not very diluted at this kind of valuation and it was a very easy process. […] The whole deal closed in 14 days from term sheet to money in the bank,” Bendov said.
Use of funds
Gong will use the new money to expand into new geographies such as Europe. It will also hire 100 new employees by the end of the year, and develop several new features in its product.
According to Bendov’s vision, Gong’s product could ultimately have a reach far beyond CRM.
He told Forbes that he hopes to achieve revenues and profitability within two to three years befitting a company considering an IPO.
Related Story: Salesforce Snaps Up CRM Startup Vlocity For $1.33B
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