Why we invested in ContactPigeon
A great way to discover and most importantly validate a great startup/product is when you hear other companies you have been involved with and respect, switch from one product and begin using the startup’s product. That was exactly the case with ContactPigeon.
Back in late 2015 both e-Food and Doctoranytime, within a month’s difference started using ContactPigeon. Moreover, without us inquiring, the marketing people in those companies were talking enthusiastically about the increase in conversions delivered by the automation and segmentation capabilities of ContactPigeon.
So at VentureFriends we may have a few investment criteria before investing in a startup, but often it simply boils down to “Is that a product I would use?” Having been entrepreneurs and marketers and therefore potential customers the answer for ContactPigeon was an obvious “Yes” coming both from ourselves as well as from several other tech entrepreneurs.
Product: But what exactly is ContactPigeon?
ContactPigeon is an omni-channel (re)Marketing automation platform, which helps e-commerce companies increase their revenue from each user. This revenue increase is achieved because retailers can better target their customers based on their behavioral and transactional history.
So ContactPigeon first helps the e-tailer identify and create customer segments based on various attributes (e.g. visit of a product or category page, prior purchase of a specific product category etc.). Then the e-tailer can create rules and automatically serve tailored marketing messages based on those rules. As an example, the e-tailer can create dynamic content delivered automatically based on triggers through email campaigns (eg email to users who have browsed men shoes), sms, web site pop ups or facebook messages.
Team & Τech
The cofounders Giorgos Moirotsos and Charalampos Nikas certainly tick all the boxes as resourceful tech geeks and hustlers. They are both very skilled engineers who have worked together on several projects and managed to create a product with limited resources.
When we first met with Giorgos and Charalampos a bit more than a year ago the team consisted of 3 people (including the founders) with an MVP (3-month old) product and some customers. It was evident that work was needed on the marketing and business side but the most important element, the capability to push tech forward was there, so we were happy to join forces and assist the founders in business, sales and HR.
What impressed us since the beginning was the scale and cost of service delivered, achieved by just 3 people. The company opted for an open source technology and used an architectural style which allowed them to use cheap commodity servers with each one handling part of the workload while at the same time they were able to dedicate all their resources improving a small part of the platform without having to rewrite the entire codebase. This resulted to a product that adapted to market needs in short time and never became outdated.
The entire message delivery system has been designed as a self-healing system reducing the resources assigned for support and allowing the development team to focus on building the next generation of features.
Since then the tech stack further evolved and today it can support even more significant scale at low cost. ContactPigeon now in a typical month is responsible for over a billion web interactions and over 100 million messages sent.
Market/Competition
None can disagree that the market is a big one to go after. The e-Commerce market is huge, with around 2 trillion U.S dollars in retail e-commerce sales in 2016 from more than 100k eCommerce stores with a growth rate ~50% YoY. There is competition from traditional huge e-mail delivery companies like Mailchimp but the marketing automation arena is still nascent with room for agile startups to grab a share of the growing pie.
Conclusion
In a nutshell, all boxes ticked and we are very happy to have partnered with the great founders of ContactPigeon. The startup also came to join and tap on the great group of other relevant SaaS startups within the VentureFriends community.
Viral Loops and Flashchat also cater to e-tailers, providing loyalty and referral programs as a service and customer/sales support automation respectively. Also one can learn so much from the AdEspresso founders who have built the leading service for SME facebook marketing optimization and whose company was recently acquired by Hootsuite.
It is always important for startup founders to be able to connect with peers, share learnings and help each other by cross selling or doing common content marketing activities. A good example is the useful latest guide on growth hacking which was published by Viral-loops and ContactPigeon.
It is still early to say how large a share of the global pie ContactPigeon will grab, however one thing is for sure. George and Babis are two strong, persistent, tech geeks and have already proven they can deliver a great product at scale, so we don’t expect them to give up easily. :)
