Minneapolis startup LeadPages has raised a $5m first round of equity financing to scale their rapidly growing SaaS for Internet marketers who create,
deploy and optimize responsive conversion pages.
LeadPages was launched roughly a year ago on humble bootstraps — transitioning from marketing training company to marketing software company and nailing a $1m run-rate along the way.
Each week, he would release a free landing page template only to find that his audience was continually asking for the ability to modify these landing pages, implement split testing, make the templates mobile responsive and integrate with email service providers and customer relationship management platforms such as MailChimp, ContactContant, and InfusionSoft.
With $40k in advance sales for the product before it was even built, Collins and his co founders Tracy Simmons and Simon Payne developed LeadPages to solve this problem. SMB customers pay a monthly or annual subscription fee for access to the LeadPages platform, a library of customizable landing pages designed for a variety of customer interaction types – from signing up for a webinar, downloading a free whitepaper, to simply capturing names and contact information.
“We designed LeadPages from the ground up to boost leads, sales and revenue with effective landing pages that better capture customer information and convert visitors into customers,” Collins says.
Fast forward through a lot of hustle and 6,000+ paying customers later, Collins says the product has generated millions of new leads, and in many cases, increased conversion rates by up 400 percent or more. LeadPages generated $290k in revenue last month with 20% month over month compound growth; they’re set on tripling both customers and revenue in 2014.
“Our sweet spot has been small business with 1-5 employees…consultants, speakers, authors and other professional service providers. In part, we will be increasing the ability to offer solutions for the larger enterprise with this capital.”
Collins explains that his ability to obtain investment was done without a traditional pitch deck and a lot of back and forth. “Foundy invested after three calls and one face to face meeting, during which we actually made about 15 sales,” he recalls, prompting a tweet directly from VC partner Brad Feld at the time.
“The only other firm we approached was Arthur Ventures, who also wanted to partner right away.”
“It’s hard to overstate the importance of the Web for generating customer leads,” said Seth Levine, managing director at Foundry Group. “While a large industry has evolved around the best marketing practices to drive that traffic through ad spending on things such as Google AdWords, much less attention has been paid to where those ads drive customers and what they’re asked to do once they get there.”
“The amount of traction LeadPages has been able to demonstrate in a short amount of time with no invested capital is remarkable. It’s a testament to the team’s ability to deliver simple and beautiful software that absolutely nails the needs of its customers and wouldn’t have been possible without the scrappiness of Clay and his co-founders. We’re excited to partner with Clay and Foundry Group to continue to build this great company,” says Arthur Ventures’ Patrick Meenan.
LeadPages co founder Simon Payne will be relocating to Minnesota, while the companies 20 or so full time contractors will convert to full time employees, some of which are also moving to Minnesota as well.
“One of the big reasons we are raising funds is to establish a stronger base here in Minneapolis and we will be growing LeadPages locally,” he assures.
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The next Capital Call is October 15th with Mark Lazarchic and Patrick Meenan