I’m proud to announce that we’ve raised a $150M Series B funding round, co-led by return investor Craft Ventures and new investor SoftBank Vision Fund 2, to help companies save money and free up cash in this time of economic uncertainty.
If you are a buyer reading this, I’m sure you can remember when you purchased a piece of software, and the time it took to close the deal. Not to mention the uncertainty you may have felt around whether the price you secured was actually fair.
If you are a seller reading this, I’m sure you’re all too familiar with deal cart abandonment and the 80% drop-off rate you see over the 90-days sales cycle.
If you’ve been following us for a while, you probably already know what we’re all about. If you’re new here, welcome: we’re the SaaS buying category creator, and we’re on a mission to fix B2B sales, a $200B problem.
Why we set out to raise our Series B: SaaS isn't going anywhere
Today, the average company uses 137 different SaaS tools.
That’s gone up 30% from 2018, and spending has gone up 50%.
In fact, enterprise software spend is estimated to surpass $750B next year, according to Gartner, growing 12%.
Our data across 500+ customers corroborates this forecast: on average, enterprise-sized customers spend over $350,000 per month on close to 300 distinct SaaS tools - and that spend has doubled over the last 4 years.
As spend, and supplier options, increase, so does the complexity: buying and managing software is becoming more time-consuming and expensive.
There are a few reasons for this:
It’s increasingly difficult to understand the software landscape. With so many options, it’s hard to validate that you’re making the right choice. And with the number of new software sellers popping up, a growing stack becomes harder to manage.
SaaS pricing is highly variable and it’s hard to know if the price you’re getting is a fair one. Pricing is dependent on the time of year, logo, the sales rep you’re working with; economies of scale becoming increasingly more difficult to achieve as you grow; pricing models change with limited notice.
The process to buy software is decentralized or nonexistent, leading to ridiculously long sales cycles, dark spend, and security risks. Not only that, but without a process in place, you lack visibility into past software purchases and overall spend, leaving you with no future negotiating power.
We believe finding, buying, and managing software should be simple and painless. Buyers deserve to know what tool is best for them on an individual and company level and at what price. This, for me, is non-negotiable.
Increased urgency for a growing problem
When the pandemic hit in 2020, CFOs came to us with the same goal in mind: reduce the stack and reduce the software expense.
We’re at a similar turning point today, where CFOs are in cost-cutting mode. They’re not seeking deals, they’re seeking reductions. Even the biggest discounts don't really matter when software products are stack and budget accretive.
The issue is, everyone tells you to cut costs when the economy shifts, but no one tells you how. Vendr is the how, and we’re ready to be an ally to every one of our current and future customers during this time.
We've handled over ten thousand software transactions for our customers and we have the buying repetition and data to help our customers increase the return on their overall software investment (in fact, we guarantee to save more than we cost). Our goal is to help save on the bottom line, reduce risk, and drive operational efficiency when a lot of what the future holds is still unknown.
When cash is tight, a dollar saved can be worth more than a dollar of revenue.
The new funding will accelerate platform development, helping organizations cut costs, manage their second-highest expense - software - and reduce risk in light of the economic downturn.
For me, today is much more than a Series B announcement. It’s validation that the SaaS buying issues companies face are a universal experience.
It’s confirmation that the partnerships we’ve built over the last 4+ years with our customers have been worth more than I can put into words.
And we know that in this economic climate, many of you are buckling down and bracing for impact.
Our commitment to you is to help you save money on software, free up cash, and extend runway.
This funding round reinforces our ability to deliver on this commitment to you, faster, by improving three key ways in which we serve you:
- Data: giving you more powerful and actionable insights by scaling our data and making it smarter.
- Product: rolling out Vendr 2.0 (coming soon!) to bring you the best of SaaS management and SaaS buying in a single comprehensive platform
- People: delivering you a great full-service buying experience by scaling and specializing our team
I’m thrilled to be able to continue helping companies achieve their goals, save on SaaS, and come out of this downturn together.
Without our incredible customers and employees, investors and board of directors, none of this would be possible.