Deals

Intercom grabs $23M to treat Internet customers more like coffee shop patrons

Intercom co-founders Eoghan McCabe and Des Traynor in the company's San Francisco office.

Above: Intercom co-founders Eoghan McCabe (left) and Des Traynor (right) in the company's San Francisco office.

Image Credit: Intercom

In 2011, Eoghan McCabe was sitting in his friend’s coffee shop when he came up with the idea for Intercom, an online platform that enables companies to deliver personalized responses to their customers.

“I got super-jealous watching him interact with his customers, smile, say hello,” said McCabe, Intercom’s CEO. At Exceptional, his old company that Rackspace now owns, “We couldn’t do any of that with our customers. … Imagine a coffee shop telling you that you need to read the FAQ before you order your coffee. That’s bullshit.”

So McCabe and two others founded Intercom, which they describe as closer to Facebook or WhatsApp than Zendesk or Salesforce. In the 18 months since the platform emerged from beta, it’s racked up nearly 2,000 paying businesses, relying purely on word of mouth in lieu of a sales and marketing staff.

But those teams are bound to expand, because Intercom has raised $23 million in new funding, the company announced today. Led by Bessemer Venture Partners, the round brings the startup’s total financing to $30 million.

Using Intercom, companies like Heroku, Hootsuite, and Visual.ly get a live view of the people using their software. They can use filters to split up their customers — say, people who have engaged in the last month but haven’t tried a specific feature — and set up manual or automatic messages for those groups.

Whether they send those messages via email or from within their own application, they always have a name and picture attached. So you’re never going to get a message from “The Support Team,” only from “Eric” or “Eoghan.” It has no “do not reply” messages, either; people can always respond.

Companies using Intercom have seen “some really amazing results,” said McCabe. Rackspace, for example, increased its user activation by 40 percent, according to McCabe.

Intercom permits companies to view their communities for free, but if they want to send out messages, it costs money, “kind of like a dating site.” The company has seen double-digit growth every month, added McCabe, who said its revenue is “now in the millions.”

Intecom plans to invest a huge portion of the new capital into the product, with a focus on mobile engineering efforts. The company currently has 49 employees, and it plans to hire another 100 over the next 18 months.

Ultimately, McCabe hopes his company helps replace (or at least supplement) the “bloated, old-school enterprise technologies” for managing customers.

“We are not out to build yet another [software-as-a-service] business, another app. We’ve done that before and made our exits,” said McCabe. “What we’re really trying to do here is fundamentally change how customers and their businesses interact.”