Starting a small company used to be simple. Get some space on Main Street, put out a shingle, and begin plying your trade. Then the regulatory state came, and so did the internet. Now, entrepreneurs have to apply for licenses — sometimes multiple licenses in multiple states — and also handle all the intricacies of building a fully-online digital presence.
There are products that will help you incorporate, some others that will help you with regulatory burdens, and a whole swath of no-code website builders that will try to find you a unique niche in the digital cosmos. Yet, precious few platforms fully integrate these services in one place and centralize them around the entrepreneur.
ZenBusiness has tried to do all that — and even more — over the past few years. Ross Buhrdorf, who formerly founded HomeAway, started the company to make it easier to start businesses. Along the way, I’ve covered the company’s $4.5 million seed in 2018 and $15 million Series A last year, and now the company has a blockbuster Series B to announce today.
The Austin-based public-benefit corporation raised $55 million led by Alex Lazarow of Cathay Innovation, which will be used to continue growing the company and expand its services. The company hit more than 150 employees (who are operating remotely today), and is looking to add 100 or more in the next year.
What’s driving the company’s growth? For one, while the economy has been hit hard over the past few months in the wake of COVID-19, many small businesses suddenly needed to figure out an online strategy and also potentially apply for licenses and other regulatory requirements in multiple states if employees were operating remotely.
The company says that its revenue grew 100% this year, and it now has more than 80,000 small businesses who have launched on its platform. The company is now on its third generation of its website builder tool, and has also expanded many of its other features as well.
One new area of growth for ZenBusiness has been adding financial services to its product suite under the label of ZenBusiness Money. The startup bought Joust Banking a few months ago, a startup that had raised $4.6 million to offer freelance financial services. Those services are now being integrated into ZenBusiness, and Joust co-founder Lamine Zarrad is now SVP of Product for the company.
With the funding, Buhrdorf said that the company will continue to expand those banking services, and also add more educational materials for entrepreneurs learning about how to operate and grow their businesses.
He noted that the company has prized and continues to place a huge priority on customer service. “When you call us up, we answer right now within 60 seconds, and we think that’s important. And we answer our emails with a very tight timeframe too, within 24 hours, and many within a few hours. And we’re always on chat.”
As the various spaces that ZenBusiness works in have become more competitive, Buhrdorf believes that his company’s service quality and integration sets it apart. “I’m happy there’s competition out there, that means that this is a vibrant space. We’re just focused on delivering value to our customers and making them successful. If we do that with great service, I think we’ll we have the winning combination.”
In addition to Cathay, other investors in the round included GreatPoint Ventures, Breyer Capital and Omega Venture Partners. Returning investors included Greycroft, Lerer Hippeau, Interlock Partners, mark vc, and Austin local firm ATX Venture Partners.