8 ms·

Optimizely Raises $57 Million

133 points by dsiroker 12y ago

tnorthcutt 12y ago
Congrats on the funding. Perhaps Optimizely should run a test on their blog to see if their overall revenue is truly boosted by blocking cmd/ctrl+click on the "homepage" link (or pricing, or about). I'm reading the blog post, but want to also open their sales site in another tab, and... I can't. Feels like a bad idea to me, but maybe there's some logic behind it?
- svmegatron 12y ago
  Weirdly, middle-click (at least for me) does open the link in a new tab. If I were to venture a guess, it would be that that behavior was unintentional. If it wasn't, I'm also curious about the logic behind it.
  - evmar 12y ago
    Just in case someone from Optimizely looks at this: I was curious so I examined the JS source. It appears the "munchkin.js" helper is the most likely candidate. The code is obfuscated but I see a click event listener that is doing logic related to detecting the control key and simulating a mouse event. It's probably broken on Macs. (In general, intercepting browser events and generating your own interacts poorly with obscure behaviors like ctl-click as well with popup blockers.)
- graeme 12y ago
  For me it was chrome's popup blocker. (or an extension). Once I allowed popups, the click + cmd worked fine. Still odd behaviour though.
- bobbles 12y ago
  ctrl+click and middle mouse both work for me here. You might have an issue with your browser?
aelaguiz 12y ago
I love this company. We use them every day and we recommend them to all of our merchants (who in turn love them). Their product is in a small but distinguished group of tools that are so good they set a new standard. I consider circleci amongst that group, for reference. Congrats guys
- porker 12y ago
  I would love to know what other products are in your group.
pud 12y ago
I was a huge user of Google Website Optimizer. It was so easy -- you just put Google's JavaScript in your site and it shows your users different versions of the page. When Google shut it down, I tried Optimizely a few times. It was so much more complicated, I didn't have the time or skill to setup tests. Optimizely- Congrats on the funding. I still want to use you. And maybe I'm dumb, but I have trouble figuring you out. Anything I can do? Anyone know of a simpler alternative to Optimizely?
- dsiroker 12y ago
  Sorry to hear that! Our goal is to make Optimizely so easy to use it just works. Clearly we've failed in this case. I'd love your feedback on what we could have done better to improve your experience. FWIW, two weeks ago we launched our Optimizely Academy to help folks like you go from zero to hero: https://learn.optimizely.com/hc/en-us https://learn.optimizely.com/hc/en-us
  - PhilipA 12y ago
    The thing is that, when you need an academy or getting people certified, your product is too complicated to use.
    - dsiroker 12y ago
      You are generally right. The vast majority of our customers don't need help and hence our homepage is basically just a text box to enter a URL and get started. That said, there are other folks who do need a little extra help so we built them an academy.
    - pshin45 12y ago
      On the contrary, it might just mean that their product is expanding beyond its original tech-centric customer base and is now reaching a much larger but less tech-savvy demographic as well.
    - gagaga 12y ago
      I hear sentiments like this a lot, but I don't agree. Many companies have training on how to use Google Calendar/Drive properly. That doesn't mean these products are too complicated.
gustaf 12y ago
Congrats Dan & Team! Amazing work
melindajb 12y ago
One of the most important products to happen to marketers in a long, long time. Congratulations guys! I love your product and find it incredibly easy to use.
balls187 12y ago
Congrats. "Triple digit year-over-year growth in annual revenue since launching in 2010." Is easily misleading without context. I don't expect companies to divulge revenue numbers, but a company founded on data driven insights for site content, could probably choose more appropriate metrics to share.
- hbbio 12y ago
  2010: $10k 2011: $25k 2012: $80k 2013: $200k Easy :)
- mikeyouse 12y ago
  From a blog post last year, you can calculate an absolute minimum; March 2013 - "Double digit millions revenue run rate." So a minimum monthly rate in 2013 would be ~$850k, so a minimum monthly rate for March 2014 would then be $1.7M. http://blog.optimizely.com/2013/04/10/optimizely-raises-28-million-to-go-global/ http://blog.optimizely.com/2013/04/10/optimizely-raises-28-m...
wellboy 12y ago
Wow huge round for 7,000 users, but I think I missed something. The plans range from $14 to $293/month and then there is an enterpise plan. If we say the average revenue/user is $100/month that would be $700,000 in revenue/month * 12 = $1.14M/year? Pretty impressive for 7,000 users, however, with 200 employees the burn rate is $10M/year? Despite that the valuation is $200M, what did I miss?
- beambot 12y ago
  $700k/mo * 12 = $8.4M/year (not $1.14M). So they're nearing profitability, have triple-digit per year growth, and the latest investors get liquidation preference that limits their downside. EDIT: Fred Wilson has a good explanation about why "frothy" valuations make sense right now: http://avc.com/2014/03/the-bubble-question/ http://avc.com/2014/03/the-bubble-question/
  - wellboy 12y ago
    A sorry for the miscalculation, did that on the way out the door. Just thinking how big the market is. According to https://www.quantcast.com/top-sites/US?jump-to=110000 https://www.quantcast.com/top-sites/US?jump-to=110000 there are 110,000 sites with >10k monthly visitors, so I think that's the market of which they probably can get 30k users max for which they can charge $100/month on average: 30,000 $10012 = $36M/year revenue. So for web, that's the cap it seems. According to http://www.appbrain.com/stats/android-app-downloads http://www.appbrain.com/stats/android-app-downloads, there are 200,000 Android apps that have >100,000 downloads, which probably equates to 10k monthly active users, with iOS apps that's 400,000. So this will probably bring another $72M/year making it $108M revenue cap for Optimizely. So looks like the money for Optimizely is in the app market. With 300 employees at max that's a burn rate of $15M + $25M marketing + $10M other costs, we got a profit of $58M = maybe $700M company, not bad. Back of the envelope calculation, probably totally wrong, ok now back to work :)
    - beambot 12y ago
      I can guarantee their TAM is >$108M / yr. I am involved in two websites that get a lot more than 10k visitors / month. Neither are listed in Quantcast. Using (crummy) traffic estimates based on Alexa ranks, I'd wager that there are at least 600,000 websites that would qualify for your >10k monthly visitors mark. But I suppose it's all a moot point: They convinced at least one VC to invest, and that's all that matters. (Having used their product in the past, I probably would've invested too given the opportunity. Their product is pretty slick and saves a lot of time compared building your own A/B testing framework.)
tpeng 12y ago
Random thought: Companies like optimizely have key data on its customers (conversion rates) and it may be valuable to a VC to have a board seat / access for the data alone. Not alleging any malfeasance here, just think it is an interesting angle.
- r3m6 12y ago
  I am not sure why this got downvoted. Using cloud services for your a/b testing can reveal key competitive information to the company. So trust is a big issue. That is one reason why I try to keep everything inside GA.
  - deleted 12y ago
    [deleted]
Matt_Mickiewicz 12y ago
Congrats Dan & Pete! It's been amazing to watch the growth of Optimizely from seed stage to the massive success story it is today.
guiambros 12y ago
Most comments here focus on the immediate revenue potential. But this is part of a much larger ecosystem, that spends billions of dollars deploying enterprise marketing platforms with Adobe, IBM, SAS, Oracle. Performance Optimization is just one of the many areas in this space. The enterprise marketing platform is an area ready for disruption. Few large, expensive and slow players. Most offering clunky proprietary products, that require a huge learning curve. After (if?) Optimizely solidify presence in this space, they can move up the food chain: tagging, re-targeting, DMP, personalization, campaign management, content management, etc. So far they're off to a good start. And worst case scenario, they'll be acquired by Adobe and will become the new version of Test & Target.
NewsReader42 12y ago
Shame they can't get their website to work in FF 29...

133 points by dsiroker 12y ago

Congrats on the funding. Perhaps Optimizely should run a test on their blog to see if their overall revenue is truly boosted by blocking cmd/ctrl+click on the "homepage" link (or pricing, or about). I'm reading the blog post, but want to also open their sales site in another tab, and... I can't. Feels like a bad idea to me, but maybe there's some logic behind it?

svmegatron 12y ago
Weirdly, middle-click (at least for me) does open the link in a new tab. If I were to venture a guess, it would be that that behavior was unintentional. If it wasn't, I'm also curious about the logic behind it.
- evmar 12y ago
  Just in case someone from Optimizely looks at this: I was curious so I examined the JS source. It appears the "munchkin.js" helper is the most likely candidate. The code is obfuscated but I see a click event listener that is doing logic related to detecting the control key and simulating a mouse event. It's probably broken on Macs. (In general, intercepting browser events and generating your own interacts poorly with obscure behaviors like ctl-click as well with popup blockers.)
graeme 12y ago
For me it was chrome's popup blocker. (or an extension). Once I allowed popups, the click + cmd worked fine. Still odd behaviour though.
bobbles 12y ago
ctrl+click and middle mouse both work for me here. You might have an issue with your browser?

aelaguiz 12y ago

I love this company. We use them every day and we recommend them to all of our merchants (who in turn love them). Their product is in a small but distinguished group of tools that are so good they set a new standard. I consider circleci amongst that group, for reference. Congrats guys

porker 12y ago
I would love to know what other products are in your group.

pud 12y ago

I was a huge user of Google Website Optimizer. It was so easy -- you just put Google's JavaScript in your site and it shows your users different versions of the page. When Google shut it down, I tried Optimizely a few times. It was so much more complicated, I didn't have the time or skill to setup tests. Optimizely- Congrats on the funding. I still want to use you. And maybe I'm dumb, but I have trouble figuring you out. Anything I can do? Anyone know of a simpler alternative to Optimizely?

dsiroker 12y ago
Sorry to hear that! Our goal is to make Optimizely so easy to use it just works. Clearly we've failed in this case. I'd love your feedback on what we could have done better to improve your experience. FWIW, two weeks ago we launched our Optimizely Academy to help folks like you go from zero to hero: https://learn.optimizely.com/hc/en-us https://learn.optimizely.com/hc/en-us
- PhilipA 12y ago
  The thing is that, when you need an academy or getting people certified, your product is too complicated to use.
  - dsiroker 12y ago
    You are generally right. The vast majority of our customers don't need help and hence our homepage is basically just a text box to enter a URL and get started. That said, there are other folks who do need a little extra help so we built them an academy.
  - pshin45 12y ago
    On the contrary, it might just mean that their product is expanding beyond its original tech-centric customer base and is now reaching a much larger but less tech-savvy demographic as well.
  - gagaga 12y ago
    I hear sentiments like this a lot, but I don't agree. Many companies have training on how to use Google Calendar/Drive properly. That doesn't mean these products are too complicated.

gustaf 12y ago

Congrats Dan & Team! Amazing work

melindajb 12y ago

One of the most important products to happen to marketers in a long, long time. Congratulations guys! I love your product and find it incredibly easy to use.

balls187 12y ago

Congrats. "Triple digit year-over-year growth in annual revenue since launching in 2010." Is easily misleading without context. I don't expect companies to divulge revenue numbers, but a company founded on data driven insights for site content, could probably choose more appropriate metrics to share.

hbbio 12y ago
2010: $10k 2011: $25k 2012: $80k 2013: $200k Easy :)
mikeyouse 12y ago
From a blog post last year, you can calculate an absolute minimum; March 2013 - "Double digit millions revenue run rate." So a minimum monthly rate in 2013 would be ~$850k, so a minimum monthly rate for March 2014 would then be $1.7M. http://blog.optimizely.com/2013/04/10/optimizely-raises-28-million-to-go-global/ http://blog.optimizely.com/2013/04/10/optimizely-raises-28-m...

wellboy 12y ago

Wow huge round for 7,000 users, but I think I missed something. The plans range from $14 to $293/month and then there is an enterpise plan. If we say the average revenue/user is $100/month that would be $700,000 in revenue/month * 12 = $1.14M/year? Pretty impressive for 7,000 users, however, with 200 employees the burn rate is $10M/year? Despite that the valuation is $200M, what did I miss?

beambot 12y ago
$700k/mo * 12 = $8.4M/year (not $1.14M). So they're nearing profitability, have triple-digit per year growth, and the latest investors get liquidation preference that limits their downside. EDIT: Fred Wilson has a good explanation about why "frothy" valuations make sense right now: http://avc.com/2014/03/the-bubble-question/ http://avc.com/2014/03/the-bubble-question/
- wellboy 12y ago
  A sorry for the miscalculation, did that on the way out the door. Just thinking how big the market is. According to https://www.quantcast.com/top-sites/US?jump-to=110000 https://www.quantcast.com/top-sites/US?jump-to=110000 there are 110,000 sites with >10k monthly visitors, so I think that's the market of which they probably can get 30k users max for which they can charge $100/month on average: 30,000 $10012 = $36M/year revenue. So for web, that's the cap it seems. According to http://www.appbrain.com/stats/android-app-downloads http://www.appbrain.com/stats/android-app-downloads, there are 200,000 Android apps that have >100,000 downloads, which probably equates to 10k monthly active users, with iOS apps that's 400,000. So this will probably bring another $72M/year making it $108M revenue cap for Optimizely. So looks like the money for Optimizely is in the app market. With 300 employees at max that's a burn rate of $15M + $25M marketing + $10M other costs, we got a profit of $58M = maybe $700M company, not bad. Back of the envelope calculation, probably totally wrong, ok now back to work :)
  - beambot 12y ago
    I can guarantee their TAM is >$108M / yr. I am involved in two websites that get a lot more than 10k visitors / month. Neither are listed in Quantcast. Using (crummy) traffic estimates based on Alexa ranks, I'd wager that there are at least 600,000 websites that would qualify for your >10k monthly visitors mark. But I suppose it's all a moot point: They convinced at least one VC to invest, and that's all that matters. (Having used their product in the past, I probably would've invested too given the opportunity. Their product is pretty slick and saves a lot of time compared building your own A/B testing framework.)

tpeng 12y ago

Random thought: Companies like optimizely have key data on its customers (conversion rates) and it may be valuable to a VC to have a board seat / access for the data alone. Not alleging any malfeasance here, just think it is an interesting angle.

r3m6 12y ago
I am not sure why this got downvoted. Using cloud services for your a/b testing can reveal key competitive information to the company. So trust is a big issue. That is one reason why I try to keep everything inside GA.
- deleted 12y ago
  [deleted]

Matt_Mickiewicz 12y ago

Congrats Dan & Pete! It's been amazing to watch the growth of Optimizely from seed stage to the massive success story it is today.

guiambros 12y ago

Most comments here focus on the immediate revenue potential. But this is part of a much larger ecosystem, that spends billions of dollars deploying enterprise marketing platforms with Adobe, IBM, SAS, Oracle. Performance Optimization is just one of the many areas in this space. The enterprise marketing platform is an area ready for disruption. Few large, expensive and slow players. Most offering clunky proprietary products, that require a huge learning curve. After (if?) Optimizely solidify presence in this space, they can move up the food chain: tagging, re-targeting, DMP, personalization, campaign management, content management, etc. So far they're off to a good start. And worst case scenario, they'll be acquired by Adobe and will become the new version of Test & Target.

NewsReader42 12y ago

Shame they can't get their website to work in FF 29...