Irish tech startup Intercom lands €44m funding round, hiring 250 staff
The Irish technology firm tipped to be Ireland’s next billion-euro company has closed a new funding round of €44m and plans to hire 250 people in the coming months, over half of which will be in Dublin.
Intercom provides online customer service software to companies. It counts IBM, Rackspace and Dropbox among its 10,000 paying customers. Its operations are divided between Dublin and San Francisco, with the majority of its design and development based in Ireland.
It has raised a total of $116m (€102m) since 2011.
The transatlantic venture capital fund Index Ventures lead the funding round, with additional finance from the company’s previous investors, Iconiq Capital, Bessemer Venture Partners and Social Capital.
Intercom’s vice president of product, Paul Adams, said that the new funding round “significantly” increases its valuation, although he declined to give specific figures.
However, the ‘up’ round comes at a time when the technology industry is experiencing a wave of falling valuations among private companies.
Intercom’s revenues increased fourfold in the last year “into the tens of millions of dollars”, said a spokesman, who declined to give more detail on the numbers. However, Adams said that while the company is not yet profitable, the new funding means that it “could choose to be next year”.
“We’re now fully funded and will not need to raise money again,” Adams told Independent.ie. “We went ahead and raised money as there is a lot of interest in the company and the terms looked good. It’s tremendous for us because of the options it now gives us. We can be profitable next year if we want to or we can hire aggressively.”
Adams said the the company invests 85pc of its revenue in product development.
He said that Intercom would hire most of its planned 250 new staff for its Dublin office.
“We’re at currently 250 people here and have doubled our headcount over the last 12 months,” he said. “We plan to double that again over the next year, with the majority for our Dublin office.”
Intercom was founded by Eoghan McCabe, Des Traynor, Ciaran Lee and David Barrett.
“We’ve been fortunate at Intercom that our core focus on product continues to pay off,” said Intercom co-founder and chief executive Eoghan McCabe. “Unlike conventional software companies, our technology has generated organic revenue growth, meaning we don’t have to pump a ton of capital into sales and marketing. We can continue to focus on building product to help businesses communicate with their customers in a more personal way.”
McCabe has described Intercom as being still at an “early” phase in its product cycle. He said that an IPO is likely but not for “years”.
Intercom was one of just two Irish-related companies (with Stripe) namechecked in Mary Meeker’s influential Internet Trends Report last year. It is also now regularly referred to as an emerging industry standard for company-customer communications software.
“At Dropbox, we were always looking for ways to improve how we talked with customers,” said Ilya Fushman, general partner at Index Ventures and former head of product at Dropbox. “A single platform to communicate with our customers throughout their lifecycle would have been our Holy Grail and that’s Intercom. Along with solving this fundamental problem, their relentless focus on the end user and consistent investment in building the best product possible, have led to their rapid and highly efficient growth as a business.”
Intercom’s set up is a reverse of what normally happens with tech companies that straddle Silicon Valley and Ireland. Its entire research and development team -- the braintrust of the company -- is based in Dublin. The non-technical end of things, such as sales and finance, is based in San Francisco. Usually, it is exactly the opposite arrangement for high-end tech companies in Dublin.
The company is currently seeking a new office in Dublin as it has reached capacity at its Stephens Green facility located in the old Anglo Irish building.