HubSpot is a Cambridge, Massachusetts, startup that’s as famous for its fabulous corporate culture as it is for software that helps marketing folks.
Scuttlebutt said it would go public in 2014 and indeed, it just filed the paperwork to get a $US100 million IPO rolling.
The company has 11,624 customers in more than 70 countries. Revenue is growing but, like most tech IPOs, the company is not profitable yet, thanks to big spending on sales and marketing to fund growth.
HubSpot brought in $US77.6 million in 2013, and recorded a net loss of -$34.3 million, ($53 million spent on sales and marketing). In the first six months of 2014, it has already generated $US51.3 million in revenue and lost -$17.7 million ($33 million spend on sales and marketing).
Because it offers its products as cloud software-as-a-service, it operates a subscription business model. That means that it expects to make more revenue over time for each customer compared to classic software companies, since customers don’t pay huge software licence fees when they sign up. They pay for the service as they use it. That means the faster it can grow its customer base now, the quicker it will be a big and hugely profitable company later.
HubSpot has been a VC darling. It has raised $US100.5 million in six rounds, according to CrunchBase, with investors like Google Ventures, Salesforce, General Catalyst Partners and Matrix Partners, its two largest VC shareholders.
Beyond the VCs, its cofounders Dharmesh Shah (CTO) and Brian Halligan (CEO, chairman) are the two largest shareholders, with an 8.8% stake and a 4.9% stake, respectively.
HubSpot’s flagship product is what’s known as “marketing automation” software, which helps marketing teams to manage all the ways they generate sales leads and work with customers over email, social media, websites, blogs, and so on.
It’s famously known for a corporate culture where it does things like make employees change desks every few months, offer employees all kinds of ways to grow, and it shares nearly every detail about the business with all employees, Shah told us.
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