Marketo gleans US$50m in venture financing

16 Nov 2011

Phil Fernandez, co-founder and CEO of Marketo

Cloud computing company Marketo, which set up its European HQ support centre in Dublin this year, has secured US$50m in new venture financing, led by Battery Ventures.

Existing investors Institutional Venture Partners, InterWest Partners, Mayfield Fund and Storm Ventures are also participating in the new financing round.

Marketo, which provides revenue performance management (RPM) solutions to fuel fast-growth companies, has offices in San Mateo, California and Dublin.

Since it set up its European HQ in Dublin earlier his year, the company has already gone into double figures in terms of Irish recruitment. Its ultimate aim is to create up to 125 jobs over the next three years in Ireland via an IDA Ireland-supported initiative.

The entirety of the new US$50m investment is primary capital into the company. In total, Marketo has raised US$107m since it was founded in 2006. Also with this new round of financing, Neeraj Agrawal, Battery Ventures’ general partner, will join Marketo’s board of directors.

Marketo has pioneered a business solution for companies – be they Fortune 500 to small and mid-sized companies – looking to accelerate predictable revenue growth.

Aggressive growth strategy

Marketo asserts that its RPM technology has the potential to drive businesses beyond traditional marketing automation and lead nurturing to optimise interactions with buyers across the entire revenue cycle and propel predictable revenue growth.

Marketo said today it would use the new capital injection to further accelerate its “aggressive” growth strategy.

“Marketo had many options for capital. To stay focused on growth, our best choice was to secure private equity from a top-shelf firm, and I am very pleased to welcome Battery Ventures as an investor,” said Phil Fernandez, co-founder and CEO of Marketo, today.

He said the new investment would give Marketo a “war chest” in excess of US$70m.

“We plan to use these funds aggressively to expand our award-winning product suite, further extend our global reach and look beyond our four walls to complement our own innovation engine,” said Fernandez.

Revenue revolution

Battery Ventures’ Agrawal said the VC was “bullish” on Marketo’s ability to execute and said “they are destined to be a true winner”.

Said Agrawal: “From the moment we first engaged with Phil and the team at Marketo it became clear that the company was powering a revenue revolution.”

Norm Fogelsong, general partner at Institutional Venture Partners (IVP), whose other investments include tech giants like Kayak, Twitter and Zynga, said that when IVP first invested in Marketo a year ago, the company made an aggressive commitment to double revenue.

“(Marketo) delivered. Now we are doubling down on the future of this remarkable company and its ability to dramatically increase revenues for its customers,” said Fogelsong.

Marketo launched Spark by Marketo this year, a product solution specifically designed for the SMB sector. The company also released a study showing its vision to make a US$2.5trn impact on its customer base over the next three years.

“When we started the company, our vision was to be the very best at delivering products and thought leadership to help companies grow revenue faster than ever before, and the market response has been incredible. Based on publicly available data, we now know we are, in absolute terms, adding more customers and more revenues this year than anyone in the RPM market,” added Fernandez today.

Carmel Doyle was a long-time reporter with Silicon Republic