HG Data uses a data-driven approach to help salespeople build lists of potential enterprise customers, and is ready to disrupt the legacy IT market.

The Santa Barbara-based startup today closed a $2 million funding round led by EPIC Ventures.

“While LinkedIn maps the connections between people in business, HG Data maps the connections between businesses themselves – who sells to whom, who buys what, and who partners with whom,” said Craig Harris, CEO and founder of HG Data in a statement.

The company has been building out its algorithms for the past two years. More specifically, it uses machine learning technology to updates its databases with information that is publicly available from press releases, white papers and the like. One of HG Data’s customers might use the tool to pinpoint a company that still runs on a specific type of legacy hardware, and pitch them an alternative.

The company claims its customers can use the data to bolster lead generation, market share analysis and marketing automation.

Angel investors in the round include Kevin O’Connor, founder of DoubleClick and current CEO of FindTheBest; Eric Kanowsky and AJ Rice, both co-founders of Software.com; and Tim Baskerville, former CEO of JupiterResearch.

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This is a guest post by entrepreneur Jason Garoutte 

It’s hard to be a marketer these days. Even when we carefully craft a message and follow best practices, 99 percent of our attempts can still fall on deaf ears. Are there any other professions where 1 percent is considered good?

I talk to Sales and Marketing leaders every day. Nobody ever says they’ve got enough pipeline. But where can they go for more? Email marketing and pay-per-click both show declining ROI, and many marketers have already invested to the point of diminishing returns. This year the answer seems to be Marketing Automation, and indeed this can add a flow of leads over time. But what if you don’t have time to wait? Today’s marketers need shortcuts through the funnel.

The good news is that shortcuts are possible, and it all comes down to smart use of data. The key skill for marketers to develop over the next two years is the ability to synthesize data. Thanks in part to the rise of social networks, companies and people share more about themselves than ever before.

In this publicly available data, there are gems that can determine targeting, messaging, and personalization. Using data like this is no different from what a good sales rep does, except that a sales rep searches manually using sources like websites and LinkedIn. Marketers need to scale this research for an audience of thousands or millions.

No matter how a marketer sources leads, a little data can propel leads through the funnel. Even if you’re not ready for “big data” tools and predictive analytics, you can still find impressive shortcuts with a bit of intuition and elbow grease.

My top tip to marketers: don’t boil the ocean. Very few marketers have access to data scientists for data mining. So don’t seek to create your own giant database — it will just go stale before you benefit. Instead, be pragmatic and look for quick wins.

Here are three ideas that work from my recent experience.

• Use data to find a specific business need

Just a few years ago, the state of the art in targeting was to select four dimensions: industry, size, geography and title. I don’t know about you, but for my company, there is no SIC code that buckets our prospects. Every business is unique, and your prospects have unique needs. So why not search for those unique needs? Forget SIC codes and look at employees titles. You can find these in job openings on websites and job boards. You can look at titles on LinkedIn and Jigsaw.

• Tailor content for “micro-segments”

Once marketers have a list of targets, it helps to sub-divide that list into “micro-segments”, or groups with a unique perspective on the product being sold. Here’s an example. Some of your prospects may already have a competing technology in use. Often there is evidence of that technology, such as the expertise of employee biographies or required skills on job postings. Some technologies, like web analytics tools, can be seen directly in JavaScript.

If you write a different story for prospects that already use your competitor, you can emphasize the benefits of swapping. It’s s a great way to establish immediacy and relevance. It also shows that you’ve done your homework. I’ve seen campaigns double response rates by taking an existing email template and tweaking it for the customers of different competitors.

• Personalize the script with relevant data

Starting an email with the recipient’s first name hardly qualifies as personalization. Real personalization shows that you know something meaningful. If the recipient doesn’t feel special, then you haven’t personalized.

A marketing automation tool, like Marketo or Eloqua, offers dynamic fields in an email to plug in information and start a true product conversation. With this precision, you can create personalized campaigns that are very relevant to each recipient. In summary, these are exciting times for marketers.

Jason Garoutte is the CMO and GM of Mintigo, which operates a demand generation platform that uses predictive analytics to help marketers find and engage prospects. Prior to joining Mintigo, he worked as a vice president of product marketing at Salesforce.com. 

Top image via Shutterstock

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Sept. 9 - 10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Marketing automation firm Marketo has raised a massive new round of funding — $50 million — that will help it continue assisting companies with aggressive lead and revenue generation, the company announced today.

“We have a phenomenal growth opportunity now,” Marketo CEO Phil Fernandez told VentureBeat. “Our core business is very scalable, and we’re seeing continued growth in areas like search and social media.”

Marketo and competing marketing automation firms like Eloqua, Pardot and Silverpop offer software and services focused on improving and managing sales lead generation. Ideally, any business with a constant need to find new customers (and retain them) can use marketing automation to help them succeed. One of Marketo’s most recent initiatives is Spark by Marketo, a lead-generation engine for small businesses rather than enterprise and mid-size clients.

“We’ve more than doubled the number of leads generated for other companies in the last year,” Fernandez said. “And we’ve doubled our own sales team in the last year, for that matter.”

The new funding round was led by Battery Ventures, with participation from existing investors Institutional Venture Partners (IVP), InterWest Partners, Mayfield Fund and Storm Ventures. Including the new round, Marketo has raised an incredible $107 million to date.

Battery Ventures general partner Neeraj Agrawal will also become a member of Marketo’s board of directors. “From the moment we first engaged with Phil and the team at Marketo it became clear that the company was powering a revenue revolution,” Agrawal said in a statement. “We are bullish on the company’s ability to execute and believe they are destined to be a true winner.”

San Mateo, Calif.-based Marketo was founded in 2006 and now has 240 employees. Fernandez told us the company expects to “finish next year” with 450 employees, which would be an incredible scaling up of its business if it can accomplish the goal. The company already operates a European office in Dublin and will open new sales offices all over Europe, including in the U.K., France, Germany and Spain.

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Sept. 9 - 10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Pardot on Wednesday announced that it is adding new social networking features into its already strong marketing automation service.

VentureBeat took a little heat last week when it came to the topic of marketing automation after a seemingly innocuous guest post ended up mischaracterizing some of the biggest players in this emerging space. Needless to say, we’re much more in the know about marketing automation and looking to explore how it can help businesses.

Pardot and competing marketing automation providers like Eloqua, Genius, Marketo and Silverpop make it possible for businesses to improve sales lead generation and use a content management system to better connect businesses to potential customers.

The new features Pardot is introducing today at Dreamforce are focused on using social networks and social data to help businesses find leads with more ease. They’re also designed to help business schedule the dissemination of social content across several networks.

“Social is becoming an increasingly important element in marketing and in what services businesses are demanding,” Pardot co-founder and COO Adam Blitzer told VentureBeat. “Businesses want to share content and better trace who’s responding to that content.”

The first major feature in Pardot’s new social toolbox is social discovery. Through an integration with Qwerly, Pardot can now pull public information and photos automatically from networks like Twitter, Facebook and LinkedIn to create better prospect lists. Pardot can then display that social data through a new social widget, which can be viewed alongside the dashboards in Salesforce.com, SugarCRM, Microsoft Dynamics CRM or NetSuite. Ideally, sales reps will be able to view social profile data before they have to call a lead. (See above for a social profile example.)

The next big social feature Pardot is adding is social sharing. Launching out of beta in September, this feature makes it possible for Pardot’s customers to schedule updates on Twitter, Facebook and LinkedIn in advance. (Think HootSuite on steroids.) Those posts can then be tracked using Pardot’s existing bit.ly connector and provide data like click-through rates.

Finally, the last new social feature Pardot is putting out is social optimization. Using the data pulled from social media campaigns, Pardot can tell its customers which areas of social media were most effective at reaching the desired people. For example, they could learn their Facebook posts result in more prospect engagement than Twitter posts.

“With this feature, not only can Pardot tell you how many prospects clicked through, but it also it can tell you how many prospects actually generated revenues,” Blitzer said.

All in all, Pardot is partly playing catch up to the evolving demands of businesses who care about social, but it’s also taking the challenge seriously by making their social feature set robust. Ideally, we’ll see even more social integration over time with marketing automation services and see more ways sales teams can use social data to better meet their goals.

Priceline today announced it brought in $1 billion in revenue for its third quarter, up 37 percent from $730 million in the same quarter a year ago, thanks largely to its global hotel bookings business — not those William Shatner-hawked name-your-price flights that won it fame a decade ago.

Meanwhile, airlines are seeking to cut fees paid to online travel agents further, as seen in American Airlines’ threat to drop its flights from Orbitz starting December 1.

That raises a question: Are today’s flight-focused travel-search startups like Hipmunk trying to solve the wrong problem?

Priceline’s hotel bookings were up 54 percent from the same quarter a year earlier and have continued to see growth, according to its most recent earnings statement. Expedia, another online travel site, reported that 63 percent of its transactions were related to hotels, while only 12 percent were from flights, according to its most recent quarterly filing with the Securities and Exchange Commission.

Hipmunk, a Y Combinator-incubated startup run by Adam Goldstein and Steve Huffman, recently launched promising to make flight searches easier. And while the site is gorgeous and intuitive, it still relies on Orbitz for its flight searches and makes money through commissions when users book flights. Adioso, another Y Combinator-backed startup, helps travelers pick flights in a more open-ended fashion.

These flight-only startups risk getting crushed on one end by the airlines, which see booking fees paid to websites as an easily slashed cost. And on the other, they’re facing Google, which is trying to acquire real-time airline fares-and-seats data provider ITA. Google isn’t as interested in garnering commissions on tickets as it is in quickly answering users’ searches, which means it could well help the airlines bring online ticketing fees down. Expedia and other companies are scared stiff that this will somehow understandably concerned. Travel is a huge part of e-commerce that’s worth around $80 billion a year. ITA’s software handles around 65 percent of all online flight bookings, and travel advertising accounted for about 6 percent of all online advertising revenue, according to a coalition fighting the acquisition. Google’s acquisition is also the subject of an antitrust investigation that began in July. Whatever happens with ITA, it’s surely not a good idea for travel startups to get into the middle of a war between key suppliers and Internet giants.

Investors were certainly pleased with Priceline’s performance. Shares of Priceline were up 5.9 percent to $411.51 in extended trading on Monday after the company released its earnings report.

We’ve asked the Hipmunk team if they have plans to move into hotels, but haven’t heard back. They’d be smart to do so: Priceline has proven that there’s more money to be made in the fragmented world of lodging than in the tightly controlled airline business.

A post by kn0thing, Alexis Ohanian’s Twitter handle, on Y Combinator’s Hacker News site said, “we’ve got plenty more planned for hipmunk – as many in this thread point out, there’s a lot more than flight search that needs agony removed.”

Integrate is one of 70 companies chosen by VentureBeat to launch at the DEMO Fall 2010 event taking place this week in Silicon Valley. After our selection, the companies pay a fee to present. Our coverage of them remains objective.

Integrate is launching a customer-acquisition platform today at the DEMO conference that aims to simplify the process of generating leads.

Companies often need to attract new customers, and a typical way marketing managers approach campaigns is to purchase lists of potential customers, or leads, and then target them with a campaign.

But there’s often overlap between different lead generators, a lack of transparency about sourcing of the leads and even cases of fraudulent behavior by unethical lead generators.

Enter Integrate, which was founded “to bring control and accountability back to the lead generation space.”  The company’s customer-acquisition tool allows advertisers and publishers to find quality leads and then launch and manage campaigns.

Buyers and sellers can find and communicate with each other, negotiate price and monitor multiple campaigns and lead sources on Integrate’s service. The service is designed to be accessible to beginners in the lead-generation business. Additionally, Integrate monitors activity for unethical business practices.

The service has seen more than 600 members join in five months. Integrate says its revenues have grown 150 to 200 percent a month, though it did not disclose absolute figures and such growth rates are often easy to achieve when starting off a small base. Its customer retention rate is 95 percent.

The company is funded by founders Hart Cunningham and Jeremy Bloom, and currently has about 50 employees.

http://c.brightcove.com/services/viewer/federated_f8/980795693

Here’s what I wrote about Reply last October:

Targeted search and display ads are the bread and butter of online advertising today. But ad networks like Reply are learning how to deliver qualified leads — in Reply’s case, potential buyers for cars, homes, home improvement, and insurance deals whose self-selected qualifications that result in up to double the conversion rate from ad to purchase. The company has seen conversion rates climb by 50 to 100 percent over the rates for search and display ads, by categorizing leads in refined ways for automated buying and selling.

Reply works by collecting pre-qualifying information from Web surfers — “I’m looking to buy a home in 94145,” for example — then selling their click-throughs on an ad to a buyer looking for a matching profile. The genre is called lead generation or just “lead-gen.”

Generating leads is seen by many marketers as the next step in online advertising. Why? Because lead generation has the potential to grow the market for online ads by making them more effective and less wasteful. Today, Google’s AdSense pulls in $20 to 30 billion per year, but Google only accounts for about one-tenth of all ad spending.

Companies like Reply are chasing not just those online ad dollars, but the $300 billion in offline advertising that could be pulled online if ad networks could promise better bang for the buck, and better-than-offline control over how ad inventory and qualified clicks are bought and sold.

Reply was founded in 2001 by Payam Zamani, who previously founded Autoweb back in the first Internet boom. Zamani has about 100 employees headquartered in New York. The company, which Zamani bootstrapped on $1.5 million of his own money, has raised another $13 million from Scale Venture Partners, $4 million from Outlook Ventures, and $3 million from individual investors including former Apple CFO Debi Coleman.