Employee engagement tech start-up Culture Amp has raised $US36 million ($48.7 million) in one of the biggest capital raises of the year for a local company, with the business aiming to hit $100 million in revenue by 2020.
Co-founded by Didier Elzinga, Jon Williams, Doug English and Rod Hamilton in 2009, the company has developed a staff survey tool and analytics platform used by major companies including Airbnb, Disney, Nike and McDonald’s.
The funding round, which was led by Blackbird Ventures and had participation from a range of Silicon Valley-based funds as well as Scott Farquhar and Mike Cannon-Brookes’ Skip Capital and Grok Ventures, is its largest to date and brings its total raised to over $70 million.
“Like Silicon Valley companies, even though we’re not headquartered there, in a way we’re always fundraising. I was in constant talks with funds ever since we closed the last round, and it will begin again after this is announced,” Mr Elzinga told The Australian Financial Review.
“This raise is about continuing to grow at current rates [doubling year-on-year]. We’ve built a world-class product and engineering team in Melbourne, we have a significantly growing machine-learning and data science capability and we’re sitting at the heart of a big cultural shift going forward.”
In the last nine years the business has grown from four desks inside Melbourne co-working space Inspire9 to have 230 staff across four offices globally.
Its software platform is being used by 1500 companies and more than two million employees, including those at Australian businesses such as REA Group, Telstra Health and most AFL clubs.
Mr Elzinga said the business had started out having success with big tech businesses in the US, but in the last few years companies across all sectors had begun realising the importance of having a “culture-first” workplace.
“Companies are realising that culture isn’t just soft and fluffy … it’s the heart of the company,” he said.
The company’s software lets businesses gauge everything from how satisfied its employees are with their work, to how often people on average get promoted, or how many times in the past quarter members of a team have looked at changing jobs.
Culture Amp is also rolling out a new diversity and inclusion survey, which lets companies gather insights on their business and benchmark themselves against their peers.
It has also appointed its first independent director, vice-president of sales and business operations at edtech start-up Clever Inc Roli Saxena.
As part of Culture Amp’s latest round, superannuation fund Hostplus, which has been at the forefront of the super sector investing in Australia’s venture capital industry, also backed the start-up.
“Hostplus’ continued commitment to Culture Amp supports our proactive shift towards partnering directly with start-ups and investing in niche and bespoke opportunities,” Hostplus chief investment officer Sam Sicilia said.
“We continue to expand our VC investment portfolio alongside long-term partners, like Blackbird, with $US665 million ($895 million) now committed to the start-up ecosystem.”
Blackbird Ventures partner Nick Crocker had used Culture Amp’s software before joining the VC fund at his previous fitness start-up Sessions (which was acquired by MyFitnessPal). Since becoming a partner at Blackbird he has encouraged start-ups with 25-40 staff to start using Culture Amp.
“Not only do they provide actionable insights, but they’ve built an A-grade user experience which means they get higher completion rates because it’s seamless and intuitive to use,” he said.
“It’s really clear what the value of Culture Amp is, not it’s just a matter of how many companies implement it.”
Looking forward, Mr Elzinga said going public was not a specific goal he’d envisioned for the business, but admitted that in the future it might be the best option.
“Floating a company, be it in Australia or the US, isn’t something I have an ego about. I don’t have a life goal to float a company and I won’t feel more accomplished for doing it, but when you get to a certain size something like this can make sense,” he said.
“What’s important to me is building a company at scale that can help as many businesses as possible [have a better culture].”