April 13, 2017 –
Data is the currency on which every business will trade. In the past a business could leverage data to gain a competitive advantage and deliver better products and services. However, the game has changed in a more fundamental way: if a business doesn’t become data driven, it will become obsolete — and many already have; they just don’t realize it yet. The past decade has borne witness to the creation of incredibly valuable companies built on data that have transformed entire industries, from Amazon’s reshaping of the retail landscape, to AirBnB transforming the hotel industry, to Lyft disrupting transportation, to Marketo transforming how companies market. One of the big opportunities we’ve been tracking at Mayfield is finding a company that becomes a single place to serve as a master record for company data.
Why Does Company Data Matter?
Every professional or company looking to market to another company — or sell to it, or invest in it, or partner with it, or work for it — has wrestled with where to go and find reliable and actionable information to help them achieve their goal. While this problem has been addressed, to some degree, for public companies, it has not been solved for private companies. The information we need is out there but it is in silos and hard to gather. A professional can start with a Google search, go to LinkedIn for resumes, and Facebook to connect with people, and Amazon for products, and Glassdoor for a sense of what a company is like internally, and on and on. A company can turn to LinkedIn, D&B, Hoovers, perhaps a list provider, a consulting company, and so on. Often these are not bad options but they are incomplete, have to be harmonized together to work, and are often expensive.
As venture investors, we have seen all our enterprise-focused portfolio companies facing this issue. An area of specialty for me is sales and marketing technologies. Data and information on companies is the fuel that powers these systems and without it they are largely ineffective. While this is quite obvious to practitioners, solving this problem has proved somewhat intractable. A big part of the reason lies with the inability to get this type of data and information that is both broad in terms of coverage (number of companies) and deep (rich in type of company information), as well as easy to find, use, and take action on.
Investing in a Vision
It is unthinkable that in our current day and age this problem has not been solved. After exploring the market for over eight years and evaluating a number of companies to partner with, we came across Jager McConnell, CEO of Crunchbase, an entrepreneur and former Salesforce senior executive. We were fascinated by his vision for the market and what he had already accomplished with the company.
Crunchbase comes closest to becoming the master record for company data customers would find actionable. It has created a significant moat: Crunchbase has built a high quality data acquisition engine, which has resulted in an entrenched brand resulting in a broad user base. It is near impossible to replicate the unfair advantage Crunchbase has built — it is one of time — and with the network, scale, and brand effects Crunchbase is defining the market. Most people reading this post have used Crunchbase, either as a search tool, or because a Crunchbase listing comes up high in a search result. I use it, and so do bankers, lawyers, sales people, marketers, job seekers, and many others as individuals or inside companies. There are 27 million of us, as of the past 12 months. Fully 93 percent of Crunchbase’s users are outside of tech or Silicon Valley and almost 50 percent of the audience is based outside the United States.
Crunchbase‘s content is 100 percent organic, member-generated, machine enhanced, and vetted and curated, and it’s expanding by the hour. It’s a data-first company in the truest sense. There is a self-correcting mechanism for content improvement at the heart of Crunchbase. There are over 300,000 community contributors and 3,000 data/venture partners/government agencies, which Crunchbase augments with its machine intelligence, and internal editorial and curation processes resulting in over 5 million updates per year.
A People-First Philosophy
We are not just investing in Crunchbase as we know it today but backing Jager and the team’s vision to build the system of record and engagement for company data.
Jager had spent 11 years at Salesforce from its pre-IPO days to it becoming the leading enterprise SaaS company it is today. There he obsessed over the very problem he is now solving. Crunchbase is leveraging its unique position in the ecosystem to extend its data: have more reach, add more companies, and go deeper. It is now developing a marketplace, which will add depth by enriching company profiles with other specialist high-quality data providers. This marketplace is akin to Salesforce’s app exchange, a project Jager was involved in during its earliest days as well. Crunchbase is also packaging this data in software and APIs that make it easy for customers to find the right data, analyze it, and use it at scale. This combination of data and software is a fundamental insight Jager is well equipped to execute on.
We are excited to partner with Jager and Crunchbase as they look to become the platform for company data and transform the way professionals and organizations discover, research, and engage with companies.
This post originally appeared on LinkedIn.