Stealth startup Usermind fetches $14.5 million to usher in the BizOps revolution

Seattle-based startup Usermind is announcing a $14.5 million series B, led by Menlo Ventures, as well as its emergence from ‘stealth’ mode. The company has now raised over $20 million before public launch, based on the previous $7.6 million round led by Andreessen Horowitz. That’s a tidy sum of capital — from significant names — for a startup to have garnered without a public product in the market. They’ve been at this for a few years now, however, and, suffice it to say, the company is building something interesting.

Usermind’s premise is based on strong tidal forces in the enterprise surrounding apps, data, and new roles that are emerging as a result. One such example that we’ve been actively observing is in the marketing/engineering collaboration around mobile marketing.

Usermind’s core offering is a software platform that makes it easier for “business operations” teams to integrate apps. This means building a stronger connection between teams and the data silos created by the massive (and growing) proliferation of point solution SaaS apps in the enterprise.

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The rise of “devops” has been documented for many years in IT. And it’s more than just an “agile” methodology for getting stuff done. It’s a must-have skill set for any modern programming team hoping to collaborate to build and scale effectively.

A similar phenomenon is happening in other functional areas of the business — a sort of ‘connective tissue’ for finance, marketing, sales, service, and even HR. Queue the rise of “BizOps,” or business operations.

BizOps may be the most important unit in high-growth tech

BizOps teams are kind of like internal-facing strategy consultants. They take broad aim at various business problems and generally focus on improving the profitability of the business. There’s a certain fetishism with the role of “product” right now in the tech industry — which is an absolutely critical role driving product development by setting priorities and collaborating with IT to get it done. BizOps takes a similar approach, but applied o other areas of the business like finance, HR, marketing, sales, and support — and usually, a combination thereof.

In developing the first generation Usermind product, cofounder and CEO Michel Feaster told me she talked to hundreds of “shadow IT teams.” These are pockets of decision-makers in companies that are buying point solutions — marketing automation platforms, sales acceleration and predictive marketing tools, etc. — without IT’s official blessing. “Marketing operations teams were telling me they managed 5-15 apps just to do digital marketing,” Feaster reported.

“Two things stood out,” Feaster said. “First, each team is focused on automating their function individually. Then they’re being pushed from owning Mixpanel or Marketo — where increasingly they’re being asked to do full customer life-cycle marketing, not just the front of the funnel.” And what happens when a sales team suddenly gets tasked with owning customer success or renewal and adoption? Who is responsible for combining all of these data sources from different groups responsible for different platforms and just getting stuff done?

BizOps, that’s who.

These graphics might help outline the point. In the first, we see that modern marketing, sales, and support teams are highly cross-functional in all stages of the customer journey. The concentric rings moving inwards represent a sort of funnel, or customer journey.

While marketing efforts are almost always primarily responsible for generating demand, once a visitor becomes some variation of a lead or contact, all hell breaks loose. Maybe it’s sales reaching out to that person for a consultation. Maybe sales is directly engaged with the marketing automation platform to help better define rules and segments. Service and support plays a role if that contact has questions. Or, if that person has actually bought something, there are often opportunities wasted by not understanding what additional products they could use or the most relevant ways to contact them.

Even still, the platforms required to meet all these tasks are varied and diverse.

Enterprise application integration (EAI) isn’t a novel idea. MuleSoft built a company with a $100 million run rate and $1.5 billion valuation doing just that. “As all these applications proliferate and help people do more better things more efficiently, you end up with a lot of data and application silos,” Matt Murphy, managing director at Menlo Ventures told me. “For on prem, there’s always been EAI. There are well-entrenched companies like Tibco that create a scheme to allow applications to speak to each other. That doesn’t exist in the SaaS world, even where there’s well-known published APIs. Moving data around is actually much more rigid than it should be.” ​

Plenty of companies are integrating data from the data layer. Look at the success Segment has seen with marketing and BI, or mParticle with mobile applications — as each respective category has hundreds of vendors for marketing practitioners to grapple with. Usermind is approaching this from the ground floor, or the application layer rather than the data layer. This creates much more control and customization through each platform — sort of an IFTTT on steroids for enterprise apps. With Usermind, you can create all sorts of complex workflows between apps — so you’re not just “mapping the customer journey” — you’re actually putting it into action.

Slack, Dropbox, CloudFlare, Stripe, Counsyl, NerdWallet, and ZipRecruiter all have BizOps teams. Yahoo, Google, and LinkedIn have hundreds of people on their BizOps teams. And Usermind might just be the platform to make them even more effective.