Ashu Garg, General Partner
In 2011, I stopped drinking the HTML 5 Kool-Aid and came to accept that apps were with us to stay. And since that time, I’ve been actively looking for marketing automation companies who were building products for the mobile-centric world. In 2013, I was fortunate enough to find myself in a meeting with a group of entrepreneurs from Localytics who shared the same world-view. And they were laser focused on giving mobile app creators the data analysis tools they needed to capitalize in a fast-moving space. I soon realized that my scheduled one-hour chat with Localytics’ passionate, visionary co-founders Raj Aggarwal and Henry Cipolla simply would not suffice. I ended up spending the entire day with them.
Today, I am excited to welcome Localytics to the Foundation family. And I’m particularly excited about what they have in store when it comes to marketing automation – a space that has undergone a dramatic evolution in a few short years.
With the shift from dial up to broadband, consumers went from “snacking” to “always consuming” – integrating the Internet into almost everything we do in our daily lives. Recently, smartphones have driven a similarly profound shift from “always on” to “in the moment” – giving consumers the ability to connect and transact anytime, anywhere.
Consider one telling fact: PepsiCo’s HR team recently found that 90 percent of the people who clicked on their job-related emails did so from mobile phones. And job applicants wanted to be able to apply from their mobile devices, too! Whether it’s a job application or house hunting or recipe research, consumers expect to be able to do it – whatever “it” is – on the go.
Companies must find ways to respond to this challenge, and Foundation Capital has a long and successful history of investing in companies that help CMOs make sense of the world – from Responsys to Tea Leaf to Aggregate Knowledge.
Over the last 18 months, my partners and I have studied the impact of the mobile Internet on the marketing automation tool set, and we believe that mobile will change everything yet again. Cookies are becoming less relevant. Globally, there are more mobile users than Internet users. And – especially with the coming of age of the mobile first generation – marketers need to re-think everything about their model for consumer engagement – both on the web and at the storefront.
Given the profound shift underway, we have been looking to invest in companies that have the vision to drive this transformation, and the team that is up to the task of realizing that vision. If they have some customer traction in this quickly moving market, that’s icing.
Localytics has these qualities in droves – which is exactly what made me want to give up all my other meetings that day I met with Raj and Henry. If venture investing is like getting married, this was definitely love at first sight.
Raj had already built the go-to analytics product that 5,000 companies – including eBay, ESPN, and Microsoft – relied on. And I saw that his vision was not limited to analytics. Raj knew immediately that first-generation mobile marketers would want to respond in the moment, and he was already enabling them to use real-time data to drive closed-loop, highly personalized campaigns.
In short, Localytics was perfectly positioned to develop a full suite of mobile marketing tools.
Raj and Henry are more than passionate and visionary entrepreneurs. They want to build a substantial company and were not fazed by the prospect of competing with the likes of Omniture. In fact, they had attracted very talented executives – including COO Duncan McCallum. Duncan is a seasoned entrepreneur who had been a CEO of several ventures, so it meant a lot that he chose to work with Raj.
Most importantly, I quickly learned that customers love Localytics. I spoke to several large companies who had also used other analytics tools, and they raved about how much better the Localytics product was. Some of the largest players in e-commerce, media, technology and travel were already customers, and as a result, the company had strong momentum on most metrics that matter.
I couldn’t be more excited about Foundation Capital’s investment in Localytics. I’m eager to join the board and to play a small role in helping Raj, Henry and their teams realize their dream of transforming the marketing automation stack.