When the founders of Sagetap, Sahil Khanna and Kevin Hughes, started working at early-stage enterprise software startups, they were surprised to find that the companies they worked at were trying to sell their innovative tech through old-school methods like repeated cold emails and calls.
Khanna, a former product marketer, and Hughes, a former sales manager, knew these methods weren’t effective to either sell software or help buyers get the solution they needed. They decided to try and build a better way.
“Company executives are frustrated, their email is destroyed,” Khanna, Sagetap’s CEO, told TechCrunch. “In their own words, there are way too many vendors to keep track of. They don’t know who is credible.” For context, there are nearly 400 enterprise tech unicorns alone and countless other smaller enterprise startups, according to CB Insights.
Khanna and Hughes launched Sagetap to try to fix these issues. Sagetap spent the first year of its life as a platform designed to give buyers a place to research and explore options. The company hit $1 million in ARR with that strategy, Khanna said, but decided Sagetap should be more than just a place for buyers to gather intel.
So Sagetap built an AI-powered marketplace on top of the research. Today, potential customers can browse Sagetap’s database of software vendors, which are both vetted to be on the platform, and pay a subscription fee to stay listed. For each vendor, buyers can access intel including publicly available information, purchase prices, and anonymized feedback and insights Sagetap’s AI pulls from sales calls placed through the platform. The marketplace uses AI to rank its vendors and recommend options to its users by matching them with companies that fit their criteria.
“This industry is huge, it’s a $1 trillion-business,” Khanna said. “It’s broken. Buyers and sellers, there is a lot of friction. We looked at what happens with Uber and Airbnb which brought incredible efficiency [through] a marketplace and thought this will happen to the enterprise sales [industry].”
The San Francisco-based company says it is profitable, makes money through vendor subscriptions and meetings booked on the platform, and this month announced a $6.8 million seed round led by NFX with participation from VCs including Uncorrelated Ventures and Emergent Ventures. The round also included 15 of their customers like Oracle, Dell, SecureFrame and Descope who were the drivers behind the round to begin with.
“We weren’t initially going out for funding,” Khanna said. “This was initiated by our own customers. We had a bunch of the technology executives ask to invest and decided to open it up.”
Enterprise software encompasses quite a few different categories and Khanna said Sagetap has started with the areas that buyers are currently the most interested in including cybersecurity, AI infrastructure and dev ops.
While Sagetap isn’t the first enterprise software marketplace, and large organizations like AWS host their own, Sagetap thinks it stands out due to how it uses AI to analyze its sales calls for its recommendations.
Since the AI renaissance really started swelling back in 2022, numerous companies have aimed to improve the enterprise software sales process with AI. But a lot of them have focused on the seller and aren’t offering a new model, but rather just automating an aspect of the existing one, whether that be using generative AI to craft sales pitch emails or using the tech to better source sales prospects. What Sagetap is doing actually looks and feels materially different.
Khanna said they get a lot of inbound pitches from VCs looking to make it easier for people to find their portfolio companies. That suggests the platform could be useful as a way for enterprise software startups to market themselves to large buyers who’d otherwise overlook them. While good for visibility, in many ways this strategy looks like pay to play. Sagetap ensures they only let vendors on the platform that they’ve vetted for things including customer engagement, funding and market traction but 73% of vendors who have reached out are allowed to list.
But buyers seem happy. Sagetap has grown to 5,000 buyers in the last five years with revenue growing 2.7x year over year.
“The engine is working,” Khanna said. “We are seeing really strong growth. The next year is really about growing the community of technology experts, increasing our market visibility and really doubling down.”
Source link
