Note: This article was updated July 15 to include an interview with Impact’s CEO.
Impact Technologies, a cloud software company based in Santa Barbara, announced a $150 million round of venture capital funding on July 13 and is planning an initial public offering in early 2022, CEO David Yovanno told the Business Times.
With the new funding round, which was led by Qatar Investment Authority and joined by Providence Equity Partners, Impact’s valuation is now at $1.5 billion.
The plan for the funding is for Impact to expand even further into international markets such as Asia and Europe, but Yovanno told the Business Times that Impact “didn’t need the cash.”
“This validates what we have been doing … and it was more about getting a stepping stone on our path to likely going public next year,” Yovanno said. “We basically signal to the market that we are at scale … and we’re starting to draw attention to the company, alert people what we’re up to.”
He said the company’s IPO plans are moving forward strongly, given the current market conditions.
“Going public, more than anything, tells every large brand out there, every small brand out there, that here is a market leader to invest in and we are going to answer that call,” Yovanno said.
Impact offers a digital marketing platform that helps brands manage their partnerships more easily and accessibly. It was founded in 2008 in Santa Barbara and Yovanno said it will remain in the area.
The company has grown rapidly over the past three years, and recently surpassed $100 million in annual recurring revenue, Yovanno said.
“For most of our clients now, it’s not just about better managing existing partnerships, it’s about finding deals and helping them keep growing,” Yovanno said.
Some key business-to-business partnerships on Impact, such as Spotify and Ticketmaster, have what Yovanno called “natural points of integration.” Spotify and Ticketmaster announced a partnership in early 2020 in which the two companies combined to add virtual event listings to the Spotify platform, both on artists profiles and in the concerts hub.
Impact has also benefited from the pushback against ads that track consumers, which has forced some advertisers to rethink their strategies.
“These strategic B2B types of partnerships are really starting to take off and I think it’s because a lot of businesses are now understanding that today’s modern consumer is not really interested in that glossy fake ad,” Yovanno said. “The modern consumer is a hunter and thinks about what this brand is really about.”
According to Yovanno, at some companies that use Impact, partnerships now account for as much as 28% of total revenue.
“It’s the single largest needle mover in their business, and they’re excited to talk about, they’re excited to be client references,” he said. “People are listening to us because they see we have these major brands basically up on stage, talking about how partnerships are transforming their business.”
Impact currently manages partnerships for over 2,000 brands, including big names like Uber and Walmart. It also has expanded its team to 600 employees over nine different countries with plans to add more.
“The main thing for us is keeping up a high rate of top-line growth,” Yovanno said.