Running a B2B business, you can’t afford to be messing around; a minute wasted is a minute you’ll never get back. You’ve gotta see more customers and close those orders. Remember “ABC – always be closing.” Introducing Handshake, the B2B commerce productivity platform that’ll double (if not triple) your daily yield in data entry, order accuracy, and get you to more customers. With clients increasing productivity by 33%, this NYC startup is proving to be a gem for the B2B market.
We spoke with cofounder and CEO Glen Coates about Handshake’s 3rd round of funding the fundraising process, and the business.
Tell us about your product or service.
Currently, the Handshake B2B Commerce platform consists of two products. The first, Handshake Rep, is a mobile app for sales reps that lets them write orders quickly and automatically submit it to the back office for processing and shipping.
The second product, Handshake Direct, is a customized B2B eCommerce portal for buyers to order from in between sales appointments with the rep. Retailers can order or research products at their convenience just like they do in their personal lives as consumers. They can make informed decisions, easily place the order, and then get back to running their business.
Who were your investors and how much did you raise?
We closed a $14 million Series B led by Sozo Ventures, a Silicon Valley-based venture capital firm focused on helping U.S.-based start-ups expand globally. All of Handshake’s existing investors – Emergence Capital, SoftTech VC, BOLDstart Ventures, MHS Capital, Point Nine, and Primary Venture Partners – also participated in the round.
What inspired you to start the company?
I moved to San Diego in 2008 after a few years as a developer in the gaming industry to set up the US distribution of an Australian eco-friendly shopping bag company. Very quickly, I realized that while the tech to help us sell directly to consumers was pretty solid (Shopify, Magento etc), the entire B2B part of the business was running on awful manual processes: pen & paper, fax, email, Excel, you name it.
The problem was that, like most manufacturers and distributors, 90% of our revenue was B2B, so having basically no good technology to help us serve customers in that channel was a massive grind on the business.
I started looking for iPhone apps to help us write orders when we were visiting our customers but between 2008 and 2010, nothing really appeared in the App Store.
Eventually I couldn’t take it anymore and just decided to build a prototype myself. In retrospect, I realize that I was very lucky to be a professional developer who happened to get a few years running logistics in manufacturing and distribution at the exact moment the iPad was invented and the necessary mobile catalyst for this market to even work snapped into existence.
How is it different?
The platform is mobile-first, giving sales reps and buyers the freedom to order from anywhere, anytime. With demand for speed and convenience at an all-time high, manufacturers and distributors can differentiate from their competitors with a great mobile experience that provides faster order writing and streamlines the order fulfillment process.
We are B2B focused. B2B is complex. There are nuances such as customer-specific pricing, case packs, and order minimums that don’t exist in B2C. Handshake is able to deliver these complexities through a modern, simple and intuitive user experience.
Handshake is a pure SaaS solution built to scale and handle the massive amounts of data of our customers. We are able to innovate rapidly, quickly rolling out new features that our customers can take advantage of immediately. Our customers’ IT teams don’t have to worry about maintenance and upgrades. .
What market are you targeting and how big is it?
Handshake is targeting the rapidly growing, $6.1B global B2B Commerce market helping manufacturers and distributors with their wholesale business.
What’s your business model?
Handshake has a SaaS annual subscription model.
How was this funding process different than your previous raises?
Obviously we’ve seen a softening of public and private capital markets in the last couple of months, which wasn’t present during our Series A fundraise. What was clear though is that investors are still interested in SaaS businesses that have momentum, a great team, and are solving a real problem in a huge market.
What was the funding process like?
I imagine it was pretty similar to most Series B fundraises; we got to know a small group of firms through our existing investors that we knew would be a good fit as a high-growth SaaS business, and over the course of a few months figured who the most compelling partners were. An exciting difference to earlier rounds is that we were able to meet investors with deeper links into the enterprise customer segments that we are beginning to target as we move upmarket.
What are the biggest challenges that you faced while raising capital?
Raising money is a high-intensity activity, involving a lot of travel and face-time. While it is going on, the company still needs to operate and grow, and balancing the two is a big challenge. Making sure that the team is still getting what they need from myself and the exec team when we are working with 50% of our normal time was tough, and I’m glad to be “back to work” and focused on growing the business.
What factors about your business led your investors to write the check?
Handshake serves an enormous piece of commerce which is mostly unseen by the general public, but represents the way every product makes its way onto every shelf, in every store. I think ultimately, it’s a combination of the growth of the business, our standout team, and the long term vision for the Handshake platform.
What are the milestones you plan to achieve in the next six months?
B2B is complex and we recognize that each of our customers’ businesses and how they sell are unique. Therefore in the next six months we will be focused on providing a platform that seamlessly handles customizable data and business rules, so enterprise manufacturers and distributors can serve their customers their way.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
Whether you have fresh capital or not, you need to move fast, watch expenses, and listen closely to customers so you can convert their feedback into a stronger product-market fit. Providing a product that solves a real problem gives you the best chance of turning opportunities into dollars that you can reinvest into the business.
Where do you see the company going now over the near term?
We are making significant investments in product and engineering to enable us to serve enterprise manufacturers and distributors. We will also expand the product platform to include a native mobile commerce app for shelf side ordering.
Where is your favorite bar in the city for an after work drink?
The Handshake Bar…. in our office! Outside of the office, Von on Bleecker Street or Pegu Club on Houston is a favorite.
