HoneyBook raises $155M at $1B+ valuation to assist SMBs, freelancers handle their companies – TechCrunch
HoneyBook, which has constructed out a shopper expertise and monetary administration platform for service-based small companies and freelancers, introduced at this time that it has raised $155 million in a Sequence D spherical led by Sturdy Capital Companions LP.
Tiger International Administration, Battery Ventures, Zeev Ventures, 01 Advisors in addition to current backers Norwest Enterprise Companions and Citi Ventures additionally participated within the financing, which brings the New York-based firm’s valuation to over $1 billion. With the most recent spherical, HoneyBook has now raised $215 million since its 2013 inception. The Sequence D is an enormous leap from the $28 million that HoneyBook raised in March 2019.
When the COVID-19 pandemic hit final 12 months, HoneyBook’s management group was involved concerning the potential impression on their enterprise and braced themselves for a drop in income.
Relatively than lay off folks, they as a substitute requested everybody to take a pay lower, and that included the chief group, who lower theirs “by double” the remainder of the employees.
“I bear in mind it was terrifying. We knew that our clients’ companies had been going to be impacted dramatically, and would impression ours on the similar time dramatically,” remembers CEO Oz Alon. “We needed to make some exhausting selections.”
However the resilience of HoneyBook’s buyer base stunned even the corporate, who ended up reinstating these salaries only a few months later. And, as company layoffs pushed by the COVID-19 pandemic led to extra folks deciding to start out their very own companies, HoneyBook noticed an enormous surge in demand.
“Our members who noticed a success in demand went out and located demand in one other factor,” Oz stated. Consequently, HoneyBook ended up doubling its variety of members on its SaaS platform and tripling its annual recurring income (ARR) over the previous 12 months. Members booked greater than $1 billion in enterprise on the platform up to now 9 months alone.
HoneyBook combines instruments like billing, contracts, and shopper communication on its platform with the objective of serving to enterprise house owners keep organized. Since its inception, service suppliers throughout the U.S. and Canada similar to graphic designers, occasion planners, digital entrepreneurs and photographers have booked greater than $3 billion in enterprise on its platform. And because the pandemic had extra folks shift to doing extra issues on-line, HoneyBook ready to assist its members adapt by being armed with digital instruments.
“Purchasers now anticipate streamlined communication, seamless funds, and the identical degree of remarkable service on-line, that they had been used to receiving from enterprise house owners in particular person,” Alon stated.
Oz and co-founder/spouse, Naama, had been each small enterprise house owners themselves at one time, so that they had firsthand perception on the ache factors of operating a service-based enterprise.
HoneyBook’s software program not solely helps SMBs do extra enterprise, however helps them “convert potentials to precise purchasers,” Oz stated.
“We assist them talk with potential purchasers to allow them to win their enterprise, after which assist them handle the connection to allow them to hold them,” Naama stated.
The corporate plans to make use of its new capital towards continued product improvement and to “dramatically” increase its 103-person headcount throughout its New York and Tel Aviv workplaces.
“We’re seeing a lot demand for extra providers and merchandise, so we undoubtedly need to make investments and create higher methods for our members to current themselves on-line,” Alon advised TechCrunch. “We’re additionally seeing demand for monetary merchandise and the flexibility to entry capital quicker. In order that’s only a few of the issues we plan to put money into.”
The corporate additionally needs to make its platform “extra customizable” for various classes and verticals.
Chelsea Stoner, normal associate at Battery Ventures, stated her agency acknowledged that the expansive market of productiveness instruments to serve small companies and entrepreneurs was “a market of discrete and separate productiveness instruments.”
HoneyBook, she stated, is a real platform for SMBs, “offering an enormous array of performance in a single cohesive UX.”
“It unites and connects each job for the solopreneurs, from creating and distributing advertising collateral, to organizing and executing proposals, to sending invoices and gathering funds,” Stoner stated. “The corporate is consistently innovating and iterating in response to its members; we additionally see a number of alternative with funds going ahead…And, on account of Covid-19 and different components, the corporate is sitting on pent-up demand that can speed up development much more.”