It is always great to see when there are two major funding announcements on the same day for the region. In addition to today’s Kiosked funding round, Pipedrive just announced an extended seed round of €1.8 million.
The round was co-led by Rembrandt Venture Partners and Storm Ventures, with participation from TMT Investments and a group of angel investors, including Taavet Hinrikus of Transferwise, Ott Kaukver of Twilio and Rain Rannu from Fortumo.
The idea behind Pipedrive is a sales CRM that gets the job done in a very smart and simple way. For instance they understand that you want to input all of your data right away, without the need to input your customers, products and sales separately. They also focus very heavily on the product and it’s development, responding to their clients immediately.
ArcticStartup is one of those clients and we were always happy with the service, especially with the fact that Pipedrive implemented requested features in a matter of hours, which was always extremely impressive.
In regards to the funding round, we got in touch with Rangar Sass, one of the co-founders, in order to find out more about their plans for the funding and their story so far. According to Sass, “this is one of the first Estonian startup rounds with three other startup founders being a part of it”.
This definitely shows maturity in the ecosystem and we hope that this will further activate the Angels community in the region. Sass also told ArcticStartup that the round was oversubscribed immediately, which is yet another strong sign of good things to come.
Since their seed round, the development team grew from just 9 people to 23. Which is what Sass tells us is an ongoing strategy in the company - concentrating on product development.
Another milestone that was mentioned was the fact that Pipedrive has also tripled their user base since the last update and announced over 5 000 paying customers at 13% conversion rate.
Still, according to Sass the biggest change behind the success is the fact that 3 of the 5 co-founders have now completely relocated to Palo Alto, USA.
“We have been really understanding that moving into the market and moving a real office there is hugely important.” - says Sass. After all US is the biggest market for them, closely followed by Brazil, which was a surprise to the company, considering that they did not do any marketing there and that it is completely fuelled by existing and happy customers.
Coming back to the funding news, Storm Ventures, one of the co-leads in the round is led by Jason Lemkin who was also the CEO and Co-Founder of EchoSign that was acquired by Adobe and he commented that: “Pipedrive has finally proven out something everyone in sales already intuitively knew -- that an incredibly powerful, but instantly and intuitively useable service to manage your sales pipeline is a tool every business needs. The next generation of web leaders will democratize the power of enterprise web services for businesses of all sizes. Pipedrive is leading that charge here in one of the core business processes every business needs to get paid -- managing your leads and prospects until they close.”
Sass also gave a piece of advice to future startups as well: “Try to be careful with picking the team and investors. Build the product with your own revenue and move fast out of your own country.”
Overall this is great news for Pipedrive, Estonian Mafia and the region in general, right? We certainly think so, but we have to ask one question. Does this funding and the general "get out of the country" approach help the Estonian ecosystem? In case of Pipedrive - probably very much so, as its co-founders have been very active in the scene. For example Sass is one of the co-organizers of Garage48, which has been very important to the whole ecosystem.
Moreover the company was happy to work together with local Angels and are proud of the fact that they are using the Estonian community to grow further. However we have heard from many entrepreneurs, investors and companies that many people in Estonia treat funding as "a ticket out of here" and do not want to give back to the community. Is this a problem? What do you think?