Cacheflow, a startup that builds tools for the software sales closing process, announced this morning that it has closed $10 million in new capital.
CEO and co-founder of Cacheflow Sarika Garg told TechCrunch the new capital has doubled his company’s valuation, added former lead investor Glenn Solomon (GGV) to his board, and brought in new investor Crystal Huang (GV) as a board observer. administration. Huang led Cacheflow’s latest investment — what Garg described as a seed round+ — for GV, while Solomon invested more capital in the round than his guaranteed pro rata rights, she said.
The venture capital market has slowed and the valuations of startups of all maturities have fallen. Seeing Cacheflow rise a year after its stealth release and the announcement of a $6 million seed round caught our attention. How did the company pull off a rapid rise at an attractive price when so many startups that once found the feat easy struggle to repeat it today?
Per Garg, his company became commercially available in April, after which it began receiving incoming notes from investors. The startup’s CEO said venture capitalists are always willing to pay for “companies that have momentum or solve a real problem.”
Easier said than done, huh? In the case of Cacheflow, after accelerating its sales and marketing efforts a few months ago, it has grown to a dozen customers, which Garg described as Series A to C companies. The CEO also said that Cacheflow was targeting larger potential customers today, indicating that his company intends to upscale the standard in the future.
GV’s Crystal Huang, left. Cacheflow’s Sarika Garg, right. Picture credits: Cache stream
If the market for software products is getting a little steeper than before and companies are expected to cut back on new tools especially during the current economic downturn, how does Cacheflow grow fast enough to double its valuation by the end of 2022?
Garg said she learned that potential customers view Salesforce as a lead management tool for managers. According to her, the CRM giant does not define the last mile tasks of closing a software contract with a client. This leads to trade managers – think of the CROs of the world – manually tracking transactions. Insert email blizzard here.
Notably, concerns over clarity and speed of sales in the broader software market are helping Cacheflow to, well, sell its own software, as its tool helps sellers track progress on closing deals and who’s reading what. .
Recall that the original pitch of Cacheflow was that it simplified the purchase of software. Now, speaking with the company a few days ago, we noticed a greater emphasis on the selling experience over the buying process. But both sides of the equation revolve around faster and clearer closing steps for the software purchasing process. As anyone who sells software wishes, especially during the current times of economic angst, you can see why Cacheflow might be able to counter a more conservative market.
(If you, like me, aren’t very familiar with using CRM products in the sales process, don’t worry. The software flow for a startup using, say, Gong and Salesforce and Cacheflow would work like this: Gong for recording sales calls, Cacheflow for closing deals, both services integrating with Salesforce for records management, as I understand it.)
Cacheflow now has 16 people and is unsurprisingly hiring after raising more capital. Garg said now is a great time for startups to hoard talent because the market is a little less chaotic than it was in the go-go-go era of 2021. And, she says, there is less noise in the market. If you’re marketing a software product today, your potential customers are bombarded with fewer calls and advertisements, which means you might have a clearer ride to their attention.
Cacheflow’s cycle is interesting in that it’s a startup we’ve watched, and seeing it quickly raise more capital at a significantly higher valuation is eye-catching in the current climate. But also because it looks like well-capitalized startups busy selling today may be going through less miasma than expected, provided, of course, that customers actually need what they’re selling.
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