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ExactTarget Secures $70M Venture Capital Investment
Company to Use Funds to Fuel International Expansion, Accelerate Customer-Focused Innovation
INDIANAPOLIS ExactTarget, a leading provider of on-demand email and one-to-one marketing solutions, announced today that it has inked a $70 million deal with three venture capital firms that will accelerate the company’s growth and expand its international presence.
Led by Battery Ventures, the round of financing includes investments from Silicon Valley’s Scale Venture Partners and repeat investment by Montagu Newhall and will provide ExactTarget a similar level of funding it sought to raise in its Dec. 2007 unexercised application for an initial public offering.
The round is one of the largest venture capital rounds of investment in the nation this year.
“We have posted three consecutive years of profitability and continued quarter on quarter growth with the addition of thousands of new direct clients, but we know a significant amount of market opportunity remains both domestically and internationally,” said Scott Dorsey, co-founder and chief executive officer of ExactTarget. “The investment by Battery, ScaleVP and Montagu Newhall accelerates our ability to develop new innovations while maintaining the operational flexibility we have enjoyed as a privately held firm.”
ExactTarget will delay its plans for its initial public offering and has withdrawn its application with the Securities and Exchange Commission to trade on the Nasdaq under the symbol EXTG.
“ExactTarget is enjoying a lot of momentum and has the right ingredients to continue to dominate a large and growing market,” said Michael Brown, general partner at Battery Ventures. “The company has a superior technology platform, a stable of extremely satisfied blue chip customers, and a team with the vision and ability to deliver on a huge opportunity.”
Brown, who currently serves as a board member of Fingerhut, will join the ExactTarget board of directors as part of the financing.
News of the equity financing round comes one day after ExactTarget announced a record-setting first quarter during which it welcomed 250 new direct clients and increased sales by more than 40 percent over the same period in 2008, marking the thirty-third consecutive quarter of growth and thirteenth consecutive quarter of profitability for the company.
“Ten years ago, ScaleVP began investing in market-leading SaaS companies like ExactTarget,” said Rory O’Driscoll, managing director at Scale Venture Partners. “ExactTarget has been executing beautifully to make one-to-one marketing a critical and cost-effective solution for companies around the world. We believe the market is ripe for the kind of innovation ExactTarget delivers, and the company’s strong first quarter highlights our confidence in the management team’s ability to leverage continued growth for market expansion.”
O’Driscoll, who currently serves as a board member of Omniture, will join the ExactTarget board of directors as part of the financing.
The company’s positive quarterly performance follows the posting of its best-ever annual performance in 2008 that saw revenues up more than 50 percent, the addition of more than 1,000 new direct clients, the hiring of nearly 100 new employees and the introduction of integrated multi-channel messaging into the company’s software as a service platform.
“In a difficult economy, ExactTarget continues to consistently post phenomenal results and remains a huge performer for us,” said Jim Lim, partner at Montagu Newhall. “This investment makes ExactTarget one of our largest holdings and presents an exciting opportunity to continue being a part of the industry’s premier technology provider.”
ExactTarget plans to further expand its international presence in 2009 and will announce the location of its first international office in the next 30 days.
“Battery and ScaleVP have tremendous experience helping software and technology companies broaden their product platform and expand internationally,” Dorsey said. “Their expertise coupled with Montagu Newhall’s continued support and involvement provides the resources we need to realize our global expansion goals.”
ExactTarget, Inc. is a leading provider of on-demand email marketing software solutions. The company’s suite of on-demand one-to-one marketing applications enable clients to send business-critical and event triggered communications to increase sales, optimize marketing investments and strengthen customer relationships. ExactTarget offers four editions of its on-demand software application along with integrated solutions such as ExactTarget for Salesforce.com AppExchange, ExactTarget for Microsoft Dynamics CRM and ExactTarget for Omniture Genesis. ExactTarget offers a range of optimization services including support, implementation and training, integration, deliverability, account management, design and deployment and strategic consulting. ExactTarget’s software powers permission-based email communications for thousands of organizations including CareerBuilder.com, Expedia.com, Florida Power & Light, Gannett Co., Inc/USA TODAY, the Indianapolis Colts, The Home Depot, The Leukemia & Lymphoma Society, Liberty Mutual Group, Papa John’s and Wellpoint, Inc. For more information, visit www.exacttarget.com or call 1-866-EMAILET.
About Battery Ventures
Since 1983, Battery has been investing in technology and innovation worldwide. The firm partners with entrepreneurs and management teams across technology sectors, geographies and stages of a company’s life from start-up and expansion financing to growth equity. Battery has supported many breakthrough companies around the world, including: Akamai Technologies (NASDAQ: AKAM – News), Cbeyond (NASDAQ: CBEY – News), LIFFE (acquired by EuroNext), Omniture (NASDAQ: OMTR – News), Its current portfolio includes such emerging firms: Angie’s List, Bazaarvoice, Consona Software, Fingerhut Direct Marketing, and Guidewire. From offices in Boston, Silicon Valley and Israel, Battery currently manages more than $3B in committed capital. For more informat
ion, visit www.battery.com.
About Scale Venture Partners
Based in Foster City, California, the ScaleVP team is a long-standing partnership with a consistent, top quartile track record of returns. Scale Venture Partners’ insight-driven investment strategy, extensive operating networks and go-to-market expertise help identify and build leading portfolio companies in technology and healthcare markets. The ScaleVP team’s proven skill-set and active approach provides entrepreneurs a competitive advantage for growth and category leadership. Representative portfolio companies include Alimera Sciences, Discera, Frontbridge, Glu Mobile, mBlox, Monolithic Power Systems, National Healing, NComputing, Omniture, Orexigen, ScanSafe, Somaxon, Vantage Media, Waterfront Media, Xceive and Zogenix. For more information, visit www.scalevp.com.
About Montagu Newhall
Montagu Newhall Associates, founded in 2000, manages four venture capital funds of funds with a combined total of over $1.4 billion in committed capital. Investors in these partnerships, which include family offices, corporate pension funds, endowments, foundations and other venture capitalists, are provided access to diversified portfolios of top-tier venture capital funds and a select number of high quality, later-stage, direct venture capital investments. The Montagu Newhall Associates team leverages its substantial network, relationships and investment experience to provide a superior venture capital product to its investors.
Source: Velocity Venture Capital