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Heap, a platform for digital analytics, today announced that it raised $110 million in a financing round led by Sixth Street Capital and Goldman Sachs with participation from NewView Capital, Menlo Ventures, DTCP, Triangle Peak Partners, Alliance Bernstein Private Credit Investors, Maverick Ventures, and The Private Shares Fund. CEO Ken Fine says that the new proceeds — which bring Heap’s total raised to $205 million, valuing the company at $960 million — will be put toward hiring and product development as Heap continues to grow the size of its customer base.
The pandemic put a spotlight on web-based experiences, which quickly became one of the dominant ways that brick-and-mortar businesses reached customers during lockdowns. As companies that hadn’t previously invested in online presences came to realize, aspects like page load time can have a high impact on visitor satisfaction. According to a 2019 Portent survey, website conversion rates drop by an average of 4.42% with each additional second of load time.
San Francisco, California-based Heap, which was founded by Matin Movassate and Ravi Parikh in 2013, aims to pinpoint digital pain points by collecting data on customers automatically, including what they click, where they go, and what they do. The platform attempts to algorithmically identify events and behaviors that most impact a digital experience and provides tools to help teams locate the insights they need without help from engineers.
Movassate and Parikh studied computer science together at Stanford before joining Y Combinator’s Winter 2013 batch, where they founded Heap. Movassate briefly served as a product manager at Facebook while Parikh, who’s no longer at the company, went on to found Airplane, a service for creating internal development tools.
Heap’s products are designed to enable companies to understand how customer interactions on the web affect rate, loyalty, and lifetime value. Going beyond websites, Heap ties newsletters, mobile, app, and email actions to unique identities for business analytics purposes.
For example, Heap’s behavior attribution tool measures user behaviors across email, customer relationship management, shopping cart, customer success, and either-or testing platforms. Marketers can use the data to determine how behaviors on a customer’s journey might influence revenue by tagging user actions like reading a blog, downloading a whitepaper, or visiting a webpage — measuring the influence of marketing efforts on conversion.
Surveys show that the vast majority of people don’t want to be tracked online. In one study, respondents balked at the idea of behaviorally targeted advertising even if it allowed websites to offer free, ad-supported content, with 61% saying it wasn’t justified.
But Fine argues that analytics platforms like Heap merely increase automation and the implementation of simpler analytics tools, freeing up engineers to do more meaningful work. Heap, he claims, is now being used by more than 8,000 paying businesses including Freshworks, Redfin, and Snapfish.
“We generally provide benefits to three main verticals: ecommerce, business-to-business software-as-a-service, and financial services. For ecommerce, our primary use case is conversion rate optimization. In business-to-business software-as-a-service, we’re primarily used by product teams to improve adoption, engagement, and retention. Our financial services use cases are similar: we help improve conversion on the marketing site, then help improve use in companies’ digital products,” Fine continued. “We believe this gives enterprise teams especially — whose products or websites may involve tens of thousands of events, far more than could ever be tracked manually — an enormous advantage.
Heap competes with companies including Contentsquare and FullStory in a rapidly growing market segment. The digital analytics industry is anticipated to be worth $8.91 billion by 2026, growing at a compound annual growth rate of 17.6% from 2021 to 2026.
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