CaptivateIQ raises $46 million to automate sales commission programs

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Incentive compensation platform CaptivateIQ today announced it has raised $45 million in Series B funding led by Accel. The company says it plans to use the funding to expand its reach, as well as develop artificial intelligence technologies that benefit sales planning and other sales-related parts of the business.

Management processes around commission programs can be both inflexible and costly. In fact, sales compensation is the biggest investment for most B2B businesses. US-based companies alone spend more than $800 billion every year, in total, three times what they spend on advertising.

CaptivateIQ, which launched in 2017 as part of Y Combinator’s Winter 2018 cohort, claims to automate commission workflows using AI. The 90-employee startup was founded by Conway Teng, Hubert Wong and Mark Schopmeyer, who have a fintech background in investment banking and private equity. Teng was a corporate finance analyst at McKinsey, which later helped launch loyalty rewards startup Fivestars, and worked in finance at Gusto.

“Several years ago, when I was finance manager at Brightroll, I was paid commissions and told I had to create a new excel template to pay our team of 30 reps within 14 days” , Schopmeyer told VentureBeat via email. “As a former banker, it seemed easy, but I spent the next 10 days working until 2 a.m. cleaning the data, building the financial model, and sending statements to the entire sales team. … I then caught up with Teng and learned that he was in similar pain. One thing led to another, we quit our jobs and called on our college friend, Wong, and began to create a new commission solution that we wanted to use.”

CaptivateIQ’s no-code software brings together data from disparate sources such as invoices and billing systems to power real-time calculations. Clients can use it to create, preview and launch commission plans and share them in custom reports.

Accel Partner Ben Fletcher believes CaptivateIQ’s value proposition lies in its digital, self-driving approach to tabulation. Companies typically manage commission programs using spreadsheets or expensive legacy solutions. These are prone to data drift – a 2017 survey by Xactly found that four out of five companies reported inaccuracies in their sales commission payments.

Above: CaptivateIQ dashboard.

Image credit: CaptivateIQ

“CaptivateIQ is more than just commission software. Similar to UiPath, Ada, and Celonis, CaptivateIQ’s powerful and easy-to-use no-code platform automates an important aspect of sales and finance workflow,” Fletcher said in a press release. “When several of our other portfolio companies continued to rave about the time and headache it was saving their sales teams and growing businesses, we knew something special was happening.”

There is some truth in that. Although CaptivateIQ is not yet profitable, in 2020 the company claims its revenue has increased 6x as companies like Affirm, Gong, Intercom, TripActions and hundreds of other companies have used its product. CaptivateIQ claims to have processed more than $2 billion in commissions for tens of thousands of employees this year.

“A big part of our growth is that we can help any company that offers a performance-based compensation plan, so we have no restrictions with the types of companies we work with. We typically see the conversations start with teams that have at least 25 vendors, although we easily serve businesses and public companies,” Schpmeyer said. “In terms of users, which we define as the number of beneficiaries, basically anyone who receives a payment is in our system, so that has also increased significantly. December 2020 ended 4 times compared to the previous year.

CaptivateIQ, ninety employees, says a portion of the proceeds from this latest funding round will allow it to build AI models that will help people understand how certain actions will impact future revenue. The idea is that by being able to model and predict outcomes, companies will be able to adopt behavior that benefits their bottom line while helping employees achieve their financial goals.

“To start, we’re introducing more powerful data transformations, a richer set of formulas, and out-of-the-box templates,” Conway said. “Another of our goals is to automate and streamline the end-to-end commission process. We are expanding our data integrations to support all major data systems and introducing new dashboard features that will allow teams to track performance and unlock business insights. We’re also improving existing collaboration workflows around approvals, requests, and contracts to keep everyone involved in the commission process connected. »

San Francisco, Calif.-based CaptivateIQ’s Series B, announced today, brings the company’s total raised to $63 million. Beyond Accel, Amity, S28 Capital, Sequoia and Y Combinator participated.

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Aurora J. William