А total of 500 unicorn startups or businesses in the world, valued at over $ 1 billion. With a little Bulgarian help, this month they have grown by another one. The American company Yotpo just received another investment - a solid amount of 230 million dollars; its current value: over 1.4 billion dollars. The software solution of the Bulgarian team became part of the large marketing platform of Yotpo, aimed at e-merchants, and is one of the fastest-growing products in their portfolio.
Part of the unicorns club
Yotpo was founded in 2011 by Tomer Tagrin and Omri Cohen. They are developing a marketing platform that helps e-merchants stand out in the crowd. The solution offers brands opportunities to collect and present opinions, ratings, and reviews, develop loyalty programs and advertising visualizations. Over the years, the American company has gone through several investment rounds. In 2014 it reached its first multimillion-dollar funding, worth $ 10.7 million, in the so-called Series A.
Regular fundraising allows businesses to grow rapidly which is why Yotpo acquires startups and upgrades their technology solution. At the end of 2019, it reached out to the Bulgarian startup SMSBump ("MS Bump") and their platform through which e-traders can send advertising messages to their users. After four months of negotiations, the two companies reached a deal and Yotpo acquired the Bulgarian business. Unofficially, Yopto bought out SMSBump's with over $ 37 million in cash + a share of Yotpo. SMSBump's office remained in Sofia and became an R&D center for the company.
In mid-2020, Yotpo went through another round of investments - valued at $ 75 million. Thus, the total investment in the company then amounted to a total of 176 million dollars and the business was on its way to becoming a new American unicorn.
The coronavirus crisis and increased e-commerce have a positive impact on Yotpo's business, and by mid-2020, the company expects its annual recurring revenue (ARR) to reach $ 100 million. "The results in e-commerce went up in March. Many customers switched to online shopping, which naturally led to an increase in the consumption of our services," Georgi Petrov, co-founder of SMSBump, explained.
Good results raise more capital. In mid-March this year, Yotpo raised the largest funding to date - $ 230 million. This estimates the company at over $ 1.4 billion and makes it a unicorn startup. The investment is led by the American fund Bessemer Venture Partners with a portfolio of over 5 billion dollars. The previous investors ClalTech, Hanaco, and Vertex Ventures are also participating in the round, and one of the new partners in the company is Tiger Global. Yotpo will invest the amount in developing a single cloud marketing platform that unites all the company's services and expands the team.
The American company has over 400 employees and offices in New York, Boston, London, Tel Aviv, and Bulgaria. Youpto's customers are currently over 8,000 a, including major brands such as GoPro and fashion Helly Hansen, Patagonia, and Billabong.
The Bulgarian company
SMSBump was founded in 2017 by Mihail Stoychev and Georgi Petrov. In addition to being the third-largest software deal for a Bulgarian company, it is also the largest acquisition of a startup in which the Bulgarian venture capital fund has invested. For its three years of independent operation, the company has received a total of 375 thousand euros of investment: one from a business angel and 200 thousand euros from the second venture capital fund Eleven in exchange for a 5.7% stake in the company. Prior to the acquisition in 2019, SMSBump's revenues were BGN 7.5 million, with a profit of BGN 2.9 million.
Now the business is setting a new record by becoming the first Bulgarian company to make it in the unicorn team. This will help the development of further SMSBump solutions, and also the expansion of the R&D team in Bulgaria. Currently, the SMS marketing platform is used by over 90,000 online brands. According to Georgi Petrov, SMSBump reports 170% revenue growth on an annual basis and is the fastest-growing product in Yotpo's portfolio. "The main growth factors are the synergy between SMSBump and Yotpo customers, and the e-commerce boom," Georgi Petrov revealed for Capital.
Currently, the company's office in Bulgaria employs 40 people. The new financial injection will also be aimed at expanding the team. "We have a very exciting 2021 ahead of us, during which we will strive to expand the office in Sofia to 80 people, including technical roles as programmers, developers, human resources specialist, marketing, designers, and others," Mihail Stoychev told the media.
