Our tech start-up of the week is 3funnel, a Dublin-based creator of digital-marketing software for online retailers.
As Des Martin, co-founder and self-described ‘chief bottle washer’ at 3funnel explains it, digital marketing to e-commerce websites is like trying to play an out-of-tune guitar.
“They bang away at it and make a racket, but don’t get the results they are looking for. 3funnel is like an auto-tuner for e-commerce digital marketing.
“We call this space conversion analytics and benchmarking for e-commerce websites,” Martin says.
3funnel’s initial software product is targeted at Shopify users. “These are people that have outgrown tools like Google Analytics, tools that are not tailored to the needs of e-commerce sellers.” For example, the need to quickly calculate cost per acquisition per marketing channel.
Martin adds that people don’t have time to go in and out of multiple logins for services such as Adwords, Google Webmaster Tools, Facebook, Twitter, YouTube and Campaign Monitor.
“We provide all the relevant detail in one place. Finally, we offer benchmarking, this gives really good insight into the areas for improvement in digital campaigns.
“E-commerce retailers are poorly serviced by dedicated analytics and benchmarking tools. We want to be a household name in this space in a few years. By 2017, this will be a US$4bn market.”
Martin’s background is not that of your typical start-up founder. He trained as a chartered accountant with KPMG. In 2008, he set up a digital-marketing agency with a focus on analytics and measurement.
“This experience directly lead to 3funnel. I could see people focusing on vanity metrics like page views and followers, but this is not the lifeblood of an e-commerce business (sales are).
“We began manually producing reports that pulled all the campaign inputs into a funnel with the sales at the bottom. It really struck a chord with people and we knew we had a business.”
Co-founder Elaine Thompson is known for her work as Ireland’s only Huffpost tech blogger. She previously worked for Smurfit Group and has run her own business.
“We’ve built a system that will scale quickly and effortlessly to cater for the hundreds of thousands of customers we’re expecting by 2017.”
Martin explains 3funnel is effectively a software as a service (SaaS) platform.
“We pull data from a wide range of sources (analytics, paid ads, e-mail campaigns and social media) and present it to show how each strand of your digital marketing is performing.
“We also profile your website based on a number of inputs (average value order, standard or bespoke products) and are able to benchmark performance.
“We want to be the go-to software for people in small to medium e-commerce companies around the world … the place people go to get full visibility on their digital-marketing campaigns and how they are performing.
“A key part of this is Funnel Rank, our scoring system that ranks e-commerce websites from 1 to 100. We want this to be a badge of honour, where marketers with high-ranking websites can demonstrate their value add.”
Customer acquisition and funding
Martin says as of July, 3funnel had 80 regular users. “We are currently rolling out an innovative marketing campaign that acquires customers for a fraction of what it costs our competition. It has taken some trial and error, but we now have the product refined and are getting real traction.”
The company has been through two rounds of funding and is now looking for its third round.
“This brings lots of challenges, like getting good at explaining what we do (pitching). Working on product market fit and being careful of mentor whiplash. Then there is the obvious stuff, like giving up all your spare time and staying the course.”
From Martin’s vantage point, the start-up scene in Ireland has come a long way in the last two years.
“It feels like a community now. There are start-up events on nearly every night of the week. Plus there are lots of supports and networks for people starting out.
“People are mentioning Dublin in the same breath as London and Berlin for start-ups these days. What’s more, entrepreneurs from round the world are relocating to Dublin to set up businesses. It’s a really positive time.”
As Martin sees it, you can only learn by “doing” in the start-up space.
“My advice is to get started and fail as fast as you can. That is not a negative outlook, it’s saving two or three years of your life.
“I met a guy only last week who decided after four months of full-time work and investment to pull the plug. It was hard, but he knew the business was at best going to produce a low return. It was a really smart move and one a lot of people refuse to make.
“When you have failed and realised it’s no big deal you also get good at quickly finding out if an idea has legs. You are then in a really strong position to quickly get to product market fit and grow a successful company.”