It would make sense to say that venture-focused startups have done well during the epidemic. As organizations appear to be remote, and the way we operate has been flipped over its head, technology companies that simplify this transition are in high demand.
One such startup has raised $ 61.5 million in the last 12 months. Electric, the company keeping the IT department in the cloud, just announced the closure of the $ 40 million Series C round. This comes after its Series B expansion in March of 2020, when it raised $ 14.5 million, and then an additional $ 7 million from 01 consultants in May of 2020.
The Series C round was led by Greenspring Associates, which included existing investors Bessemer Venture Partners, GGV Capital, 01 Advisors, Primary Venture Partners as well as new investors including AtRides Management and Vintage Investment Partners.
Electric launched in 2016 with the mission of greatly simplifying IT for small and medium-sized businesses. Instead of bringing in a dedicated IT department, or contracting out high-value local service providers, Electric Software allows an administrator to manage devices, software subscriptions, permissions, and more.
According to founder Ryan Dennehy, much of the IT work is administration, distribution, and maintenance of a wide variety of software programs in any company. On behalf of IT, Electric does the most of that work, meaning that a small business needs to worry about desk-side troubleshooting rather than the whole kit and cable.
Electric charges a flat price per seat per month, and Denehy says the company more than doubled its customer base in the past year. It now supports about 25,000 users in more than 400 individual customer organizations, putting in an electric shy of $ 20 million ARR.
This is the first time Denehy has come anywhere close to publicly sharing revenue numbers, but this is a good time for Flex. The company recently introduced a new lighter-weight offer that includes the same functionality as all of its more expensive products, but without access to chat functionality.
Dennehi said, “The name of the game is simply simplicity, simplicity, simplicity.” “Part of this is in response to the fact that people are realizing the sustainability of hybrid works. During the epidemic, people stopped paying their landlords but they did not stop paying us. So over the summer, we started focusing on how we could create more offerings that we could get in the hands of more businesses and let them start their journey with us. “
Dennehy says that Electric has less than half the technology startups in its client base, considering the company launched in a tech and media-centric ecosystem in New York. As a way to expand into other verticals, Electric acquired Sinu, an IT service provider with an impressive roster of customers outside Electric’s comfort zone, such as legal, accounting, and nonprofits.
Here’s what Denehy said at the time:
Entry into the organic market can also be extremely time consuming and expensive in nearby markets. Sinu’s team has done excellent work in a lot of industries and making customers happy where we do not currently play but probably should. The combination of our two companies is a big shot in the arm for our national expansion strategy.
Along with growth, the company is also investing in expanding its diversity programs and philanthropic efforts, with both the electric team and its customer base.
The electric team is currently made up of just 250 full-time employees, with 32.5 percent of women and about 30 percent of employees being non-white. In particular, about 12 percent of employees are Black and 10 percent are Latinx.
Dennehy explained that he thinks about the company’s payroll, which is in the tens of millions of dollars, as one of the biggest ways in the world.
“We will wait longer to fill a role to ensure that we have the most diverse pipeline of candidates,” Dennehy said. “Many founders would say that no one applied. Well, the reality is that you are not looking too difficult. We just accepted that it may take us longer to fill some roles. “
This latest round brings Electric’s total funding to over $ 100 million.