Venture Capital News: Segment Raises $175 Million in Series D
SAN FRANCISCO, CA, Segment announced a $175M round of new funding. The Series D round was co-led by existing investors Accel, GV, and new investor Meritech Capital.
Segment, the customer data infrastructure company, today announced a $175 million round of new funding. The Series D round was co-led by existing investors Accel, GV, and new investor Meritech Capital. Thrive Capital, Y Combinator Continuity, and eVentures also participated in the round, as well as new investor Sapphire Ventures.
For years, companies have relied on Customer Relationship Management (CRM) to understand their customers, making it the centerpiece of customer data stacks for offline sales models. However, in today's digital era, CRM is no longer enough. Companies must use dozens of business applications in their customer data stack, but they don't have the data infrastructure necessary to integrate these applications seamlessly or respect customer privacy preferences consistently.
Segment's technology empowers businesses to deliver seamless, personalized customer experiences across every channel and touchpoint, while also respecting user privacy and preferences through first-party data.
The funding round brings Segment's total amount of capital raised to $284 million and will be used to invest in key areas of growth, including:
Accelerating global expansion: The company plans to use the new round to open multiple new offices across North America, EMEA, and Asia-Pacific while significantly growing its team, which currently counts over 350 people in San Francisco, New York, Vancouver and Dublin.
Further developing Customer Data Infrastructure (CDI) as the technical foundation for customer-first businesses: Today, thousands of businesses across 71 countries rely on Segment to be the core foundation for their first-party customer data, enabling them to deliver highly relevant, connected experiences through every customer touchpoint. Segment will use the new funds to accelerate the development and adoption of CDI.
Investing in go-to-market activities and the Segment partner network: The company will invest in customer growth across the board, with a particular focus on expanding its enterprise customer base, which already includes established industry leaders such as Intuit, IBM, 21st Century Fox, Levi's, VMware and Meredith. Segment will also invest in further expanding its partner network.
CRM Is No Longer Enough
In the digital economy, businesses are expected to consistently understand who their customers are. They are also expected to provide highly relevant, contextualized experiences across potentially hundreds of touchpoints while also being consistently respectful of privacy preferences.
However, in their efforts to adapt to this new era of privacy, personalization, and the multi-channel experience, businesses are finding that their CRM systems are no longer enough.
Many companies are still treading water, building their customer data stacks solely around their CRM - even though these systems were built for an era when most customer interactions took place offline. This means that sales forces are still required to manually input information about each customer into their CRM system. This also means that IT must choose between purchasing a one-size-fits-all cloud suite that is not tailored for their business, or building dozens of costly, time-consuming integrations. The result is that companies are stuck with a tangled mess of low quality data powering every customer experience.
In the end, the customer ends up suffering the most, as their preferences around everything from product experiences to privacy, cannot be met.
Segment solves this problem by providing a new infrastructure that allows companies to regain and centralize control of their own data, delivering the experiences that their customers want and need, without any engineering complexities.
A New Infrastructure for the Customer-First Era
Segment's Customer Data Infrastructure can capture customer interactions from every business touchpoint, ensure that the data is accurate and consistent across the organization, and automatically route that data to hundreds of business applications across a company's entire customer data stack.
With a centralized infrastructure to route first-party customer data to whichever application requires it, companies of all sizes are able to build better products, make smarter business decisions, exceed customer expectations, and ensure that the privacy of their customers is consistently met.
"CRMs and their associated suites are no longer able to deliver great customer experiences," said Peter Reinhardt, co-founder and CEO of Segment. "With the rapid proliferation of new digital tools and customer touchpoints, the global market opportunity for Customer Data Infrastructure is huge. We are excited about this latest milestone, which will allow us to accelerate international growth and help even more businesses across the world put their customers first."
"Segment transforms the way that businesses collect and manage customer data, with a particular emphasis on first-party data," said Vas Natarajan of Accel. "Combined with powerful governance and audience management tools, Segment is the backbone for how great companies sell, market, and support their customers. We are so excited to have led their original Series A as well as this latest round, and to support their continued growth."
Dave Munichiello, General Partner at GV said: "Segment continues to be a growth machine driven by the rapid adoption of global enterprises with data-driven, customer-centric mindsets. The company's traction among the Fortune 5000, strong international growth, and differentiated product suite solidifies Segment's position as the leader in Customer Data Infrastructure."
"Today's consumers see compelling, consistent, and personalized customer experiences as the new standard," added Rob Ward, Founder and Managing Director at Meritech Capital. "By pioneering Customer Data Infrastructure, Segment is empowering businesses to meet these rising expectations in a way that is fast, efficient, and scalable. The company has had great traction to date, and we look forward to supporting the team through the next stages of rapid growth."
Segment provides the customer data infrastructure that businesses use to put their customers first. With Segment, companies can collect, unify, and connect their first-party data to over 250 marketing, analytics, and data warehousing tools. Today, thousands of companies across 71 countries use Segment, from fast-growing businesses such as Atlassian, Bonobos and Instacart to some of the world's largest organizations like Levi's, Intuit and Meredith. Segment enables these companies to achieve a common understanding of their users and make customer-centric decisions.
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