It’s a big day for Australian e-commerce platform group Bigcommerce – the four-year-old business has won a $US40 million investment from one of the United States’ most prominent venture capital funds, Revolution Growth.
The funding, which comes just months after Bigcommerce won a separate $US20 million injection, legitimises the company’s strategy of one-stop-shop solutions for small business – and suggests the business is rocketing towards a generous valuation.
Revolution Growth is run by ex-AOL executive Steve Case and has invested in numerous other tech businesses, including LivingSocial. The Bigcommerce investment is its largest to date.
“Bigcommerce is a big idea that aligns perfectly with Revolution Growth’s philosophy: that technology can enable any entrepreneur, in any industry, located anywhere, to build a successful, high-growth business,” Case said in a statement.
This is its third major injection of funds, winning $US20 million last year from General Catalyst and Twitter investor Mike Maples, while it also received $US15 million in 2011 from General Catalyst as well.
The investment not only demonstrates the health of the Bigcommerce model, but the Australian tech scene in general. Bigcommerce is regularly cited alongside similar success stories such as Atlassian and 99Designs, both of which have received investments from Accel Partners.
Bigcommerce was founded in 2009 by Eddie Machaalani and Mitchell Harper through a modest $10,000 in savings. Now the business turns over more than $10 million and the pair say it is profitable, with tens of thousands of clients. Last year, the company said total revenue from clients exceeded $US1.2 billion.
SmartCompany contacted Bigcommerce, but was told Machaalami and Harper were unavailable. However, the pair told The Australian the company is heading towards a $1 billion valuation in the next five years.
It’s been a huge four years for Bigcommerce. But how did it get to this point? Here are three of the company’s biggest secrets to its success:
Plenty of businesses are burdened by the desire to create an e-commerce platform, but have no idea how. The promise of Bigcommerce is the ability to do it all within one platform – there isn’t any need to investigate different providers for hosting or design.
While some would argue this results in a less powerful or optimal solution for some features, this is exactly what many companies need – not to be burdened with investigating plenty of optional extras.
Bigcommerce understands keeping products simple leads to a better outcome. After all, confused customers means no sales.
Offering cheap prices – while remaining profitable
Running a volume business is a risky venture, but given the Bigcommerce strategy of keeping things simple, the company is able to attract a large number of smaller clients.
The cheapest option for building a site network is about $25 a month, ranging up to $300. Most users choose the cheaper option.
While this isn’t always a benefit, as keeping prices low can be a problem in some industries, providing a healthy range of accessible prices is essential.
And the company claims it’s profitable – so it must be doing something right.
Provide your customers with support
It’s no secret businesses need to be publishing companies now, providing materials to clients to show them off as a thought leader. Bigcommerce has perfected its strategy in this regard, constantly publishing articles on how businesses can improve their SEO and get more sales.
But not only that – the articles themselves are incredibly detailed. A quick trawl provides a huge amount of answers for specific questions on sales or marketing challenges.
Bigcommerce may be a well-funded company, but it sets a good bar for small businesses – customers demand more than a product, they want to know you’re an expert in your field.