As part of our new series about Canadian Startups, today we are going to take a look at social media client creator Hootsuite. In an era where most apps that manage social media accounts have faded into mobile history, Hootsuite crossed the 2 million user mark within their first three years. Their continued success and longevity in a volatile market can be attributed to their iron-clad commitment to standing by a an ideal until it becomes reality. It has achieved on-par status with numerous other tech giants thanks to their software-as-service/free-to-premium strategy.
While their heavyweight competitors like Evernote and Dropbox are also still on the rise well past their two million user milestone, Hootsuite has still showed no signs of slowing even in the face of such fierce competition. Their secret sauce for growth is an amalgam of international expansion, community building, and targeted outreach for crowd-sourced multi-language support.
How did this small Canadian mobile software developer achieve their current success so rapidly though? What is the story behind the rise to stardom? Here is a rundown.
It all begins with the creation of a tool known as BrightKit, the brain-child of Vancouver-based Invoke Media. This simple toolkit was essentially a smartphone app that allowed users to administrate and monitor multiple Twitter accounts simultaneously from a single interface.
Jumping ahead one year, BrightKit has been renamed too HootSuite (notice the capital “s”). The name was actually derived from a user named Matt Nathan. He submitted the idea as a response to the development team reaching out to Twitter in search of a new name for their multi-account interface system.
One year later, HootSuite received a major boost in visibility and new user adds thanks to a White House endorsement. This allowed them to add both Facebook and LinkedIn capabilities, creating the familiar dashboard for social media app we all know and love. Following this change, Hootsuite (they dropped the capital “s” in 2014) was able to raise its first round of capital with $1.9 million in backing from Hearst Interactive Media, Blumberg Capital, and a committed group of angel investors. Later that year, Hootsuite began monetizing their app via the “freemium” model, or optional paid accounts that added numerous useful features. Before the year was out, Hootsuite was at 1 million users.
A year out from the million user mark, and Hootsuite achieved 2 million users. In just under three years, Hootsuite sent half a billion messages across 4 million unique social profiles. Their continued growth led to raising another $3 million in capital, allowing them to acquire their competitor TwapperKeeper and expand their own executive team. They finished out 2011 with the further acquisition of Geotoko, while rumors swirled that Facebook’s Mark Zuckerberg was in Vancouver to make an offer for the rapidly expanding tech startup.
CEO Ryan Holmes kicked off the year by stating his goal of turning Hootsuite into a billion-dollar company prior to taking them public. A few weeks later, Hootsuite hit three million users. By spring, the company had raised an additional $20 million thanks to Omers Ventures, giving them an overall valuation of approximately $200 million. The arrival of fall saw them acquire major competitor Seesmic. Just five months after crossing the 4 million user mark, the company made the announcement that they had five million users.
By the summer of ‘13, Hootsuite had seven million members and was still growing rapidly. Despite their meteoric rise, many were still taken aback by their $165 million in new investors that year. Hootsuite at that time employed over 300 people, had recurring revenue customers in 156 countries, and CEO Ryan Holmes was named one of Vancouver’s most powerful people. At year’s end, Hootsuite reached eight million users.
At the Canadian Startup Awards that January, Hootsuite was named Employer of the Year 2013. At the same time, IPO rumors began steadily increasing. Now over the nine million user mark, Hootsuite had surpassed 75% of Fortune 1000 companies. Their logo changed, as did the “s” in their name. Chatter about going public continued to increase as Hootsuite announced ten million users. In the fall, Hootsuite rounded up another $60 million in capital and bought out social telephony company Zeetl.
With over 1,000 employees and an estimated valuation in excess of $1 billion, Hootsuite has become the bedrock foundation for an entire ecosystem of tech startups throughout the Vancouver area. Rumors continue to spread regarding an IPO, though they have largely become rumors of “when” and no longer “if”. Hootsuite continues to pursue new talent and grow their user base with gusto. From three employees and a free social media tool in 2008 to a billion dollar company in just under a decade is nothing short of astonishing.
So to what does Hootsuite attribute their success? All you have to do is ask.
Hootsuite’s Secret Sauce
“Social is in our DNA”
Hootsuite is all about fomenting a positive creative culture within their organization. They have built themselves from the ground up to be a place here innovators, creators, and builders can can develop the communication apps and tech of the future. At fifteen million users worldwide, they are the most widely used social media client platform for business.
Making no secret of their never-ending quest for the best and the brightest, Hootsuite seeks out experienced and passionate innovators who are eager to grow with the company as they forge ahead into the future.
It’s All About “Better Together”
The foundation of all creativity at Hootsuite is collaboration. Hootsuite capitalizes on every discussion, conversation, and casual chat to help them create more effective and useful products every day.
Networking is Key
In addition to internal collaboration, Hootsuite actively seeks out the real brand fanatics that rave about their products. Their ambassador and advocate program incentivizes their biggest fans to help “share the love” of Hootsuite everywhere they go.
Strong Community Roots
Hootsuite is committed to investing in education and mentorship programs for up and coming developers and entrepreneurs. They are well aware that community success is continued success for them as well.
The “Unicorn Controversy”
In early 2017, Bloomberg published an article entitle “The Unicorn That Never Was”, stating that Hootsuite had never actually been valued at their storied $1 billion. The title of the article derives from an investor term commonly applied to tech startups that are valued at over $1 billion.
Their claims regarding Hootsuite claiming a higher value than actually ascribed are based on an actual 2014 valuation report that set the company’s actual value at closer to $750 million. Hootsuite and their investors (for obvious reasons) never contradicted their ascribed reputation as a tech startup “unicorn”. After all, that kind of buzz attracts both the best talent and a truckload of free publicity and marketing.
When Bloomberg reached out to Hootsuite prior to publishing their article, the tech company declined to comment regarding its valuation or “unicorn” status. Post publication, however, CEO Ryan Holmes tweeted that “Hootsuite is definitely north of 1b today.”
No investment firm or regulatory body has bothered to contradict this claim, as due to differences in currency value, Hootsuite does possess a valuation in Canadian dollars of more than the touted $1 billion that was first floated in 2014.
The controversy over whether or not Hootsuite had actually achieved Silicon Valley levels of success in the Great White North continues to be a matter of some minor debate. Thus far, however, it has only served to increase the company’s brand presence and recognition with investors and the general public. If Hootsuite takes their company public in the next year, they are going to need all the positive press and financial buzz they can muster.
No matter the outcome of their valuation or IPO, Hootsuite remains a true marvel of Canada’s tech startups and the tech world in general. Their achievement in the brief span of nine years is nothing short of astonishing. To grow a three person startup with a basic app toolkit into a company that is easily worth in excess of $1 billion dollars takes a lot of complicated hard work, dedication, and careful planning. Most of all though, it requires a commitment to foundational values and ideals that is rarely observed in the business world of today. Hootsuite has never lost their focus or forgotten their humble beginnings. Celebrating success is integral to their growth mindset and overall strategy. Building upon what they have learned while seeking out the best possible candidates continues to define both their corporate identity and their corporate culture.
Ultimately, all of their success has heaped tremendous expectations upon Hootsuite to maintain their success and longevity for years if not decades to come. Despite this monumental challenge, Hootsuite still shows no sign of buckling under the pressure. Regarding their long staredown with the future of their organization, it comes down to this: they haven’t blinked yet. One way or another, Hootsuite has made its mark on Canada’s tech industry that will not be soon forgotten.