Today, I’m excited to announce our Series D investment in Outreach, a fast-growing provider of the leading SaaS customer engagement platform. At Sapphire, we have a mantra of backing “Companies of Consequence” and we believe Outreach fits the bill. Beyond me telling you why, Manny Medina, CEO at Outreach, was gracious enough to also share his thoughts on why he chose to partner with Sapphire Ventures.
But first, what does a customer facing engagement platform really mean? In my view, engaging with prospects and customers, for a variety of purposes, should be the #1 activity of any go-to-market organization. Outreach has created the engine that powers smarter and more scalable customer communication. This ultimately enables sales and other customer-facing teams to scale their day-to-day workflow in an automated, yet intelligent and still personalized manner.
While we see Salesforce.com and other CRM providers as the prevailing systems of record, there is a significant opportunity for a system of engagement that activates and potentially improves that underlying CRM dataset — enter Outreach.
Why Partner with Outreach?
I first met Manny in late 2015 and have been tracking him since. While It was clear that Outreach was on to something special, what really intrigued us at Sapphire was Manny and the rest of the team. After our latest discussions, I walked away impressed that he had executed on the goals he set back in 2015 — remarkable for any entrepreneur, but especially for a company in its earlier stages, as they were back then.
What truly distinguishes Manny in my view, however, is his unique combination of product vision and go-to-market understanding. Most mid-to-late stage SaaS entrepreneurs I meet tend to be either technical, product-driven founders or sales-first execution maestros. Manny encompasses both. This is critical because while GTM execution is key, having a strong product-led company and vision is what creates a longer-term moat and sustainable differentiator.
Further, Manny is relentlessly obsessed with his customers, his team and his business. He has an intensity of focus and work ethic (4:30 am emails from Manny is commonplace) that is coupled with his ability to authentically and passionately tell the Outreach story. This inspires customers, employees and investors to buy-in to his vision.
Look no further for evidence of this than the talented team that surrounds Manny. Andrew (co-founder), Anna (COO), Matt (Sales), Mike (Customer Success), and the rest of the employees all march to the same energetic, customer-focused beat.
Finally, what really sealed the deal for us was Manny’s maniacal focus on what we believe should be the primary KPI for SaaS businesses — user engagement. More on this North Star metric below from Manny.
Why Partner with Sapphire Ventures?
When I met Rajeev Dham a few years ago, Rajeev was a rising star at Sapphire with uncommon knowledge about our space. Most VCs know a lot about marketing or ad tech, but very few have more than passing knowledge of sales tech. Many have been burned betting against Salesforce, so they stay away from anything that comes even close to CRM.
However, our first conversation with Rajeev piqued my interest — let me explain. For me, Outreach is a labor of love and my life. I am not a serial anything. Outreach is it. I expect the same level of commitment and knowledge of the space from a potential partner. Rajeev proved to be just that kind of partner. From the get go, he understood the landscape and the customer pain CRM left unsolved. He not only understood it, he had the conviction to bet on it. Mind you, this is a very competitive space and is growing rapidly as it is being defined. That drives away timid investors. Not Rajeev.
Also, given Sapphire’s track record backing world-class enterprise companies, Rajeev understood our unorthodox approach to B2B SaaS: at Outreach we care deeply about active users and tracking engagement with the application. We fundamentally believe that if we provide value to the users, they will reward us by taking more actions on Outreach to drive their customer relationships forward. The more actions taken on Outreach, the more data our members generate that we can use in machine learning models to automate those actions and give our members time back. Automation in turn creates higher engagement.
This virtuous cycle of engagement-driving-automation-driving-engagement is common in consumer applications like Facebook, but rare in business applications. But that is our secret sauce: consumer-like thinking drives customer obsession across Outreach. Seeing Rajeev and the Sapphire team’s excitement about pushing the envelope in customer engagement by using a consumer approach to enterprise applications was the genesis of this exciting partnership.
A Perfect Partnership
The feelings here are mutual and we’re thrilled to welcome Outreach to the Sapphire family. We look forward to partnering with Manny and the Outreach team on their journey of becoming a Company of Consequence.
