Demostack, a San Francisco, California-based startup creating a “demo experience” platform for software-as-a-service (SaaS) sales teams, today announced it has raised $34 million in a Series B round led by Tiger Global Management with participation from Bessemer Venture Partners, Amiti Ventures, GTMfund, Operator Collective and StepStone. CEO Jonathan Friedman says the proceeds will be used to increase the company’s footprint while investing in R&D, sales and marketing in the US and Europe, the Middle East and Africa.
With the average worker using at least eight SaaS apps and costing $2,884 in subscriptions per month, it’s getting harder to compete for business IT dollars. Standing out is key, and demos are one of the most powerful tools in a sales team’s arsenal. A study by Matrix Partners’ general partner David Skok found that demo closure rates for most business-to-business SaaS companies are between 20% and 50%, which is higher than the typical closure rate in the software industry. industry (about 26% to 30%) .
Friedman co-founded Demostack in 2020 with Aaron Hakim and Gilad Avidan. Friedman, who was chief of product strategy at TripActions for two years, is one of the founders of Reactful, which uses machine learning to detect visitor behavior and intent on websites. Hakim also helped found Reactful, while Avidan was a lead investigator at Cellebrite — the company that allegedly partnered with the FBI to unlock the San. Bernardino iPhone — before co-founding Smore in starting the online newsletter.
Friedman says he got the idea for Demostack while at TripActions, overseeing their Liquid expense management product. He realized that the Liquid R&D team was developing the live product, but sales needed a version of the product built to showcase.
“I went looking for how other companies solved this riddle of the demo environment, but no one seemed to have a good solution,” Friedman told MovieUpdates via email. “The demo is the proof behind your proposal, and getting it right is critical to your deal.”
Demostack’s is not a groundbreaking proposition. Reprise provides a similar platform where software companies can create product demonstrations and tours. So does Walnut, which offers a service that allows sales teams to create custom demos that highlight specific application features.
But Friedman claims that Demostack is doing better. Using a tool, customers can clone their product in a demo environment and edit elements of the demo with a no-code, drag-and-drop editor. (Demo items are based on a single source of truth, so they can be updated with each new product release.) The demo can be adapted to a buyer’s use case or vertically and shared over the web, in a live demo, or in a “stay behind after a sales call.
†[We’ve] has created something truly unique to the market: the ability to create custom product demos for any live sales call in minutes,” said Friedman. “With Demostack, you can show your product in its best light on every call, without the hassle. “
Novelty aside, Demostack hasn’t had any trouble attracting customers – or getting financing so far. The 93-strong company has dozens of clients, including BlueVoyant, Hopin, Wix, Ironclad and Gusto, and has raised a total of $51.5 million in venture capital.
“We position ourselves as the category leader of demo experience solutions for medium and large organizations,” Friedman continued.