More than 10 years after it launched, ActiveCampaign realized its approach was 'fundamentally wrong.' Now it's raised $100 million to help businesses rethink customer service software.

• ActiveCampaign was founded 17 years ago, but decided its approach was "fundamentally wrong" three eyars ago and completely revamped its business, CEO Jason VandeBoom told Business Insider.
• On Tuesday the company announced it has raised $100 million in a Series B funding round led by Susquehanna Growth Equity.
• Since revamping its business, ActiveCampaign has grown its annual revenue eightfold to $90 million, built up its staff and established four offices overseas.
• Susquehanna Growth Equity Director Martin Angert praised VandeBoom and the company's growth. "To get to almost $100 million in revenue using that amount of capital, that's a diamond in the rough," he said.
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17 year-old company ActiveCampaign raised $100 million in a Series B funding round led by Susquehanna Growth Equity, the company announced on Tuesday.

The Chicago-based software firm, which provides tools for businesses to automate their customer experience division, has gone through seismic changes over the past three years, after deciding to revamp its business model.

Back then, the company's approach was "fundamentally wrong," CEO Jason VandeBoom told Business Insider. VandeBoom thought the company could do better in building solutions that were personalized to each individual customer using its clients platforms.

In the revamped version of the business, the company focuses on gathering individual customer data, connecting it together and recommending ways for its clients to act on that information.

"We'll give them ideas - here's what we think will help you time on the sales side, or build advocacy on your fitness business," VandeBoom elaborated, listing examples. "It's not just moving data around, because that's not very helpful ... making that data actionable and coming up with what the business can do, that's where you can provide a ton of value really quickly."

The approach has so far been successful, allowing the company to attract 90 thousand customers over the past two years and rake in $90 million in annual revenue. That's a little more than 8 times its annual revenue back in 2016, according to the Chicago Tribune, which reported on its 2016 funding round.

The company has also built up its international presence in over 161 countries, and opened offices in Sydney, Dublin and Indianopolis, VandeBoom said. Its workforce has grown from 27 to more than 550 people.

With the latest injection of capital, ActiveCampaign plans to continue to accelerate its international expansion. It will also develop its products to come up with more predictive ideas with what a business can do, based off the data it gathers.

"At the end of the day, we don't want any two customers of our client to have the same experience," VandeBoom said. "It's a big sort of challenge we're going after but it's definitely been validated by the customers finding success."

Growth strategy: "A diamond in the rough"

ActiveCampaign "bootstrapped," or didn't raise external money for the first 13 years of its existence. VandeBoom thinks that experience has helped the company's approach to sustainable growth.

"There are ways of taking the amazing aspects of bootstrapping and blending that at the right time to create value for your customers," he said.

And so far, VandeBoom's approach is working, according to Susquehanna Growth Equity Director Martin Angert. The fund has been following VandeBoom since at 2017, Angert told Business Insider. And VandeBoom has shown the fund his ability to produce results, Angert said.

"The way you build a company from an capital-efficient perspective actually does matter," Angert said. "To get to almost $100 million in annual revenue using that amount [$20 million in funding] is a real diamond in the rough."

"In the investor world, that stands out," he added.