Work Life Ventures raises $5M for debut enterprise SaaS seed fund

Brianne Kimmel had no trouble transitioning from angel investor to general partner.

Initially setting out to garner $3 million in capital commitments, Kimmel, in just two weeks’ time, closed on $5 million for her debut venture capital fund Work Life Ventures. The enterprise SaaS-focused vehicle boasts an impressive roster of limited partners, too, including the likes of Zoom chief executive officer Eric Yuan, InVision CEO Clark Valberg, Twitch co-founder Kevin Lin, Cameo CEO Steven Galanis, Andreessen Horowitz general partners’ Marc Andreessen and Chris Dixon, Initialized Capital GP Garry Tan and fund-of-funds Slow Ventures, Felicis Ventures and NFX.

At the helm of the new fund, Kimmel joins a small group of solo female general partners. Dream Machine’s Alexia Bonatsos is targeting $25 million for her first fund. Day One Ventures’ Masha Drokova raised an undisclosed amount for her debut effort last year. Sarah Cone launched Social Impact Capital, a fund specializing in impact investing, in 2016, among others.

Meanwhile, venture capital fundraising is poised to reach all-time highs in 2019. In the first half of the year, a total of $20.6 billion in new capital was introduced to the startup market across more than 100 funds.

For most, the process of raising a successful venture fund can be daunting and difficult. For well-connected and established investors in the Bay Area, like Kimmel, raising a fund can be relatively seamless. Given the speed and ease of fund one in Kimmel’s case, she plans to raise her second fund with a $25 million target in as little as 12 months.

“The desire for the fund is to take a step back and imagine how do we build great consumer experiences in the workplace,” Kimmel tells TechCrunch.

Kimmel has been an active angel investor for years, sourcing top enterprise deals via SaaS School, an invite-only workshop she created to educate early-stage SaaS founders on SaaS growth, monetization, sales and customer success. Prior to launching SaaS School, which will continue to run twice a year, Kimmel led go-to-market strategy at Zendesk, where she built the Zendesk for Startups program.

 

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“You start by advising, then you start with very small angel checks,” Kimmel explains. “I reached this inflection point and it felt like a great moment to raise my own fund. I had friends like Ryan Hoover, who started Weekend Fund focused on consumer, and Alexia is one of my friends as well and I saw what she was doing with Dream Machine, which is also consumer. It felt like it was the right time to come out with a SaaS-focused fund.”

Emerging from stealth today, Work Life Ventures will invest up to $150,000 per company. To date, Kimmel has backed three companies with capital from the fund: Tandem, Dover and Command E. The first, Tandem, was amongst the most coveted deals in Y Combinator’s latest batch of companies. The startup graduated from the accelerator with millions from Andreessen Horowitz at a valuation north of $30 million.

Dover, another recent YC alum, provides recruitment software and is said to be backed by Founders Fund in addition to Work Life. Command E, currently in beta, is a tool that facilities search across multiple desktop applications. Kimmel is also an angel investor in Webflow, Girlboss, TechCrunch Disrupt 2018 Startup Battlefield winner Forethought, Voyage and others.

Work Life is betting on the consumerization of the enterprise, or the idea that the next best companies for modern workers will be consumer-friendly tools. In her pitch deck to LPs, she cites the success of Superhuman and Notion, a well-designed email tool and a note-taking app, respectively, as examples of the heightened demand for digestible, easy-to-use B2B products.

“The next generation of applications for the workplace sees people spinning out of Uber, Coinbase and Airbnb,” Kimmel said. “They’ve faced these challenges inside their highly efficient tech company so we are seeing more consumer product builders deeply passionate about the enterprise space.”

But Kimmel doesn’t want to bury her thesis in jargon, she says, so you won’t find any B2B lingo on Work Life’s website or Instagram.

She’s focusing her efforts on a more important issue often vacant from conversations surrounding investment in the future of work: diversity & inclusion.

Kimmel meets with every new female hire of her portfolio companies. Though it’s “increasingly non-scalable,” she admits, it’s part of a greater effort to ensure her companies are thoughtful about D&I from the beginning: “Because I have a very focused fund, it’s about maintaining this community and ensuring that people feel like their voices are heard,” she said.

“I want to be mindful that I am a female GP and I feel honored to have that title.”


By Kate Clark

Zendesk puts Smooch acquisition to work with WhatsApp integration

Zendesk has always been all about customer service. Last spring it purchased Smooch to move more deeply into messaging app integration. Today, the company announced it was integrating WhatsApp, the popular messaging tool, into the Zendesk customer service toolkit.

Smooch was an early participant in the WhatsApp Business API program. What that does in practice says Warren Levitan, who came over as part of the Smooch deal, is provide a direct WhatsApp phone number for businesses using Zendesk . Given how many people, especially in Asia and Latin America, use WhatsApp as a primary channel for communication, this is a big deal.

“The WhatsApp Business API Connector is now fully integrated into Zendesk support. It will allow any Zendesk support customer to be up and running with a new WhatsApp number quicker than ever before, allowing them to connect to the 1.5 billion WhatsApp users worldwide, communicating with them on their channel of choice,” Levitan explained.

Levitan says the entire WhatsApp interaction experience is now fully integrated into the same Zendesk interface that customer service reps are used to using. WhatsApp simply becomes another channel for them.

“They can access WhatsApp conversations from within the same workspace and agent desktop, where they handle all of their other conversations. From an agent perspective, there are no new tools, no new workflows, no new reporting. And that’s what really allows them to get up and running quickly,” he said.

Customers may click or touch a button to dial the WhatsApp number, or they may use a QR code, which is a popular way of accessing WhatsApp customer service. As an example, Levitan says Four Seasons hotels prints a QR code on room key cards, and if customers want to access customer service, they can simply scan the code and the number dials automatically.

Zendesk has been able to get 1000 businesses up and running as part of the early access program, but now it really wants to scale that and allow many more businesses to participate. Up until now, Facebook has taken a controlled approach to on-boarding, having to approve each brand’s number before allowing it on the platform. Zendesk has been working to streamline that.

“We’ve worked tightly with Facebook (the owner of WhatsApp), so that we can have an integrated brand approval and on-boarding/activation to get their number lit up. We can now launch customers at scale, and have them up and running in days, whereas before it was more typically a multi-week process,” Levitan said.

For now, when the person connects to customer service via WhatsApp, it’s only via text messaging, There is no voice connection, and no plans for any for the time being, according to Levitan. Zendesk-WhatsApp integration is available starting today worldwide.


By Ron Miller

Zendesk acquires Smooch, doubles down on support via messaging apps like WhatsApp

One of the bigger developments in customer services has been the impact of social media — both as a place to vent frustration or praise (mostly frustration), and — especially over messaging apps — as a place for businesses to connect with their users.

Now, customer support specialist Zendesk has made an acquisition so that it can make a bigger move into how it works within social media platforms, and specifically messaging apps: it has acquired Smooch, a startup that describes itself as an “omnichannel messaging platform,” which companies’ customer care teams can use to interact with people over messaging platforms like WhatsApp, WeChat, Line and Messenger, as well as SMS and email.

Smooch was in fact one of the first partners for the WhatsApp Business API, alongside VoiceSageNexmoInfobip, Twilio, MessageBird and others are already advertising their services in this area.

It had also been a longtime partner of Zendesk’s, powering the company’s own WhatsApp Business integration and other features. The two already have some customers in common, including Uber. Other Smooch customers include Four Seasons, SXSW, Betterment, Clarabridge, Harry’s, LVMH, Delivery Hero and BarkBox.

Terms of the deal are not being disclosed, but Zendesk SVP  class=”il”>Shawna Wolverton said in an interview that that the startup’s entire team of 48, led by co-founder and CEO Warren Levitan, are being offered positions with Zendesk. Smooch is based out of Montreal, Canada — so this represents an expansion for Zendesk into building an office in Canada.

Its backers included iNovia, TA Associates and Real Ventures, who collectively had backed it with less than $10 million (when you leave in inflated hills surrounding Silicon Valley, numbers magically decline). As Zendesk is publicly traded, we may get more of a picture of the price in future quarterly reports. This is the company’s fifth acquisition to date.

The deal underscores the big impact that messaging apps are making in customer service. While phone and internet are massive points of contact, messaging apps is one of the most-requested features Zendesk’s customers are asking for, “because they want to be where their customers are,” with WhatsApp — now at 1.5 billion users — currently at the top of the pile, Wolverton said. (More than half of Zendesk’s revenues are from outside the US, which speaks to why WhatsApp — which is bigger outside the US than it is in it — is a popular request.)

That’s partly a by-product of how popular messaging apps are full-stop, with more than 75 percent of all smartphone users having at least one messaging app in use on their devices.

“We live in a messaging-centric world, and customers expect the convenience and interactivity of messaging to be part of their experiences,” said Mikkel Svane, Zendesk founder, CEO and chairman, in a statement. “As long-time partners with Smooch, we know first hand how much they have advanced the conversational experience to bring together all forms of messaging and create a continuous conversation between customers and businesses.”

 

While the two companies were already working together, the acquisition will mean a closer integration.

That will be in multiple areas. Last year, Zendesk launched a new CRM play called Sunshine, going head to head with the likes of Salesforce in helping businesses better organise and make use of customer data. Smooch will build on that strategy to bring in data to Sunshine from messaging apps and the interactions that take place on them. Also last year, Zendesk launched an omnichannel play, a platform called The Suite, which it says “has become one of our most successful products ever,” with a 400 percent rise in its customers taking an omnichannel approach. Smooch already forms a key part of that, and it will be even more tightly so.

On the outbound side, for now, there will be two areas where Smooch will be used, Wolverton said. First will be on the basic level of giving Zendesk users the ability to see and create messaging app discussions within a dashboard where they are able to monitor and handle all customer relationship contacts: a conversation that was inititated now on, say, Twitter, can be easily moved into WhatsApp or whatever more direct channel someone wants to use.

Second, Wolverton said that customer care workers can use Smooch to send on “micro apps” to users to handle routine service enquiries, for example sending them links to make or change seat assignments on a flight.

Over time, the plan will be to bring in more automated options into the experience, which opens the door for using more AI and potentially bots down the line.


By Ingrid Lunden

Zendesk just hired three former Microsoft, Salesforce and Adobe execs

Today, Zendesk announced it had hired three new executives — Elisabeth Zornes, former general manager of global support for Microsoft Office, as Zendesk’s first chief customer officer; former Adobe executive Colleen Berube as chief information officer and former Salesforce executive Shawna Wolverton as senior vice president, product.

The company emphasized that the hirings were about expanding the executive suite and bringing in top people to help the company grow and move into larger enterprise organizations.

From left to right: Shawna Wolverton, Colleen Berube and Elizabeth Zornes

Zornes comes to Zendesk with 20 years of experience at Microsoft working in a variety of roles around Microsoft Office. She says that what attracted her to Zendesk was its focus on the customer.

“When I look at businesses today, no matter what size, what type or what geography, they can agree on one thing: customer experience is the rocket fuel to drive success. Zendesk has positioned itself as a technology company that empowers companies of all kinds to drive a new level of success by focusing on their customer experience, and helping them to be at the forefront of that was a very intriguing opportunity for me,” Zornes told TechCrunch.

New CIO Berube, who comes with two decades of experience, also sees her new job as a chance to have an impact on customer experience and help companies who are trying to transform into digital organizations. “Customer experience is the linchpin for all organizations to succeed in the digital age. My background is broad, having shepherded many different types of companies through digital transformations, and developing and running modern IT organizations,” she said.

Her boss, CEO and co-founder Mikkel Svane sees someone who can help continue to grow the company and develop the product. “We looked specifically for a CIO with a modern mindset who understands the challenges of large organizations trying to keep up with customer expectations today,” Svane told TechCrunch

As for senior VP of product Wolverton, she comes with 15 years of experience including a stint as head of product at Salesforce. She said that coming to Zendesk was about having an impact on a modern SaaS product. “The opportunity to build a modern, public, cloud-native CRM platform with Sunshine was a large part of my decision to join,” she said.

The three leaders have already joined the organization.


By Ron Miller

Zendesk shifts to platform play with Zendesk Sunshine launch

Zendesk has always been strongly focused on customer service in the cloud. They began to look at this more broadly in September when they purchased Base to move into sales automation and CRM. Today, the company announced Zendesk Sunshine, a new platform for creating customer-focused applications on top of Zendesk’s toolset.

All of this appears to be with an eye toward shifting Zendesk from its core customer service mission to a broader customer management business. Mikkel Svane, founder and CEO at Zendesk, says Sunshine is about moving his company toward a platform play, something that many cloud companies have aspired to. “Sunshine is a platform for building your own apps, and also for managing and storing and connecting all your customer data,” Svane told TechCrunch.

For starters, Zendesk is partnering with AWS to act as the infrastructure services backend for the applications built on the Sunshine platform. “You can build apps on top of Sunshine, typically customer experience or customer relationship apps, and it’s built natively on AWS, so that you have access to all the AWS services. And of course, all of the applications rely on the Sunshine platform for information sharing, etc,” he explained.

He says they deliberately chose the public cloud because they believe that is where developers want to operate today. “We believe that businesses and developers should take advantage of the public cloud paradigms and use frameworks such as Sunshine to build these applications,” he said.

Svane says for starters, this approach is aimed at helping Zendesk customers build applications to take advantage of the data they are collecting inside of Zendesk as a natural byproduct of doing work with the service, but over time independent developers could begin working on the platform too.

He sees today’s announcement as a first step toward expanding the company’s set of products and services, and it’s something they plan to build on in the coming years. “You’re going to see a lot more on our roadmap over the next couple of years to truly embrace our platform mission and our ultimate goal is to be a ubiquitous CRM platform where anyone who wants to can build any kind of customer-facing application, and really benefit from the public cloud and from the Sunshine framework and have data flow seamlessly between services, vendors and applications,” he said.

We saw customer experience take center stage this week when SAP bought Qualtrics for $8 billion. Understanding the customer has clearly become increasingly important and Zendesk has access to a lot of customer data, which developers can take advantage of to build customized customer-centric applications. The only thing that’s truly surprising about this announcement is that Zendesk didn’t make a platform play sooner.

But perhaps as a more mature vendor, and with Base in the fold, they feel they are more prepared to make this type of move now than they were in the past. Whatever the reason, every enterprise cloud company worth its salt has tried to be a developer platform, and with today’s announcement, it’s Zendesk’s turn.


By Ron Miller

Zendesk expands into CRM with Base acquisition

Zendesk has mostly confined itself to customer service scenarios, but it seems that’s not enough anymore. If you want to truly know the customer behind the interaction, you need a customer system of record to go with the customer service component. To fill that need, Zendesk announced it was acquiring Base, a startup that has raised over $50 million.

The companies did not share the purchase price, but Zendesk did report that the acquisition should not have a significant impact on revenue.

While Base might not be as well known as Salesforce, Microsoft or Oracle in the CRM game, it has created a sophisticated salesforce automation platform complete with its own artificial intelligence underpinnings. CEO Uzi Shmilovici claimed his company’s AI could compete with its more well heeled competitors when it was released in 2016 to provide salespeople with meaningful prescriptive advice on how to be more successful.

Zendesk CEO Mikkel Svane certainly sees the value of adding a company like Base to his platform. “We want to do for sales what Zendesk has already done for customer service: give salespeople tools built around them and the customers they serve,” he said in a statement.

If the core of customer data includes customer service, CRM and marketing, Base gives Zendesk one more of those missing components, says Brent Leary, owner at CRM Essentials, a firm that keeps close watch on this market.

“Zendesk has a great position in customer service, but now to strengthen their position with midmarket/enterprise customers looking for integrated platforms, Base adds a strong mobile salesforce automation piece to their puzzle,” Leary told TechCrunch.

As he points out we have seen Hubspot make a similar move with Hubspot Apps, while SugarCRM, which was recently sold to Accel-KKR, could be shopping too, with its new owner’s deeper pockets. “This is almost like a CRM enterprise software Hunger Games going on,” he joked. But he indicates that we should be expecting more consolidation here as these companies try to acquire missing pieces of their platforms to offer more complete solutions.

Matt Price, who previously had the title of senior vice president for product portfolio at Zendesk will lead the Base team moving forward.

Base was founded in 2009 and boasts over 5000 customers. It’s worth pointing out that Base was already available for sale in the company app marketplace, so there was some overlap here, but the company intends to try to move existing customers to Base, of course.

Zendesk has indicated that it will continue to support all Base customers. In addition, Base’s 125 employees have been invited to join Zendesk, so there will be no blood letting here.


By Ron Miller

Zendesk hits $500M run rate, launches enterprise content management platform

Over the last several years, Zendesk has been making the transition from a company that caters mostly to small businesses to one with larger enterprise customers — and their revenue reflects that. The company announced it has crossed the $.5 billion annual run rate since its last earning report in February. It also announced a new enterprise content management product specifically geared for large customer service organizations.

The company was just shy of the goal after its most recent earnings report (pdf) with $123.4 million for the quarter. They say they have since passed that goal, but have not announced it until now, based on revenue that closed March 31, 2018. The company is projecting between $555 and $565 million in revenue for fiscal 2018, according to its last earnings report. When you consider that when the company went public in 2014, it was at $100 million in annual revenue, reaching a half billion dollars in 4 years is significant.

Zendesk reports that 40 percent of its revenue now comes from larger enterprise customers, which they define as 100 seats or more. The company is predicting it will cross the $1 billion run rate by some time in 2020.

“When we IPOed, our run rate was $100 million. We had great momentum, but we were seen as SMB scaling to mid market. To reach a half a billion dollars shows momentum for building up enterprise market and enterprise products,” Adrian McDermott, Zendesk’s president of products told TechCrunch.

As for the new product, it’s called Guide Enterprise and it’s designed to provide those larger customer service organizations with a knowledge base and a content management platform for editorial planning and review. The idea is to empower customer service reps to write up solutions to problems they encounter and build up that knowledge base as part of the natural act of doing their jobs.

Zendesk Guide Enterprise. Photo: Zendesk

That gives organizations a couple of advantages. First of all, the reps can find their fellow employees’ notes and not have to reinvent the wheel every time, and the notes and articles they write can pass through editorial review and become part of the permanent knowledge base.

When customers hit the site or app, they can access solutions to common problems before having to talk to a human. The platform also includes reminders to check the content regularly so the knowledge base stays fresh and stale content is removed.

Finally, the company is applying AI to the problem. The artificial intelligence component can review the corpus of information currently available in the entire knowledge base and identify gaps in content that the company might want to add, allowing for proactive content creation.

The content management idea isn’t new to Zendesk. McDermott says they shipped the first content management product years ago, but what’s different is that this is geared to larger organizations and that the AI piece allows for some automation of this process. “The new workflow brings rich AI concepts like content analytics into the publishing flow,” he said.