This morning, Gtmhub, a multinational startup that builds software to help other companies manage its corporate plan, announced that it raised a $ 30 million Series B. The round was led by Insight, and involved participation from both new investor Cingular and former investor LauncHub. And CRV
Gtmhub Capital was raised 13 months ago, a $ 9 million series a. At the time, the new capital was larger than the aggregation of its predecessor funding efforts. The startup’s new funding round, like the 2019 Series A, is way above its former fundraising totals in a similar way.
How has Gtmhub raised so much money? In a word, development.
ClearTips reported at the time of its Series A that Gtmhub reported a 400% increase in annual recurring revenue (ARR) on a year-on-year basis. Gtmhub COO Seth Elliott told ClearTips that the company’s ARR increased manifold over the past three years (measured from December 2020 until December 2019).
When Gtmhub emerged in 2019, several other startups focused on the same software market around the same time, prompting ClearTips to ask “why is everyone building OKR software?”
The abbreviation OKR translates to “objectives and important outcomes”, a planning method that has become popular among American technology firms, and, according to Elliott, is becoming more popular internationally and among non-technology firms .
The startup executive also told ClearTips that he sees Gtmhub growing with two business trends. First, the rise of OKRs themselves, a wave that is riding their company, they told ClearTips. Second, he who thinks his startup is a pioneer is pursuing corporate transformation with large companies to boost his agility; Those firms have adopted Gtmhub, he said, which can help them successfully execute their digital transformation or similar efforts.
It is not a big surprise that big companies need a new planning method to rejuvenate their operations, to help point their employees in the same direction, and Gtmhub has long tilted the enterprise is.
Last year the company performed well on the venture, which we learned. ClearTips asked the company for updates on its annual contract price (ACV) results and gross margin levels during its new round of discussions. In 2019, at the time of its Series A, the company said it had increased its ACV by 650% in the previous year. The COO told ClearTips that the figure increased by a factor of ten in 2020, allowing large companies to sell. And, Elliott said, the total number of paid users of the service also increased by a factor of ten during the year.
The company’s gross margin remained at around 90% levels set in 2019.
Given those results, it is not surprising that Gtmhub was able to raise another round more quickly than the startup-standard 18 months we anticipated.
The round came together quickly. According to Elliott, Gtmhub began negotiating with investors out of a formal process in early November, setting off a more serious effort to raise capital by the end of that month. The round was called off as 2020 concluded.
It will be interesting to see if other startups working on the software category have also raised money a year ago, which will now raise more capital. The names included in our watch list in relation to that question include workboards and associates. There are other players out there in space like Perdoo as well, that we would love to hear when it comes to our own 2020 development.
Gtmhub refused to share its 2021 development plans with ClearTips.
The big lesson from this era is that even inside a software niche that you can dismiss as overly narrow – namely OKR-focused software – enough to actually support high-growth startups. This applies broadly, and reduces the pace of enterprise and startup industries over the past few quarters.