INSUBCONTINENT EXCLUSIVE:
Algolia, one of the group of startups that provides search as a service for websites and apps as an alternative to Google and other search
engines, is announcing a major round of funding today to fuel its growth
The startup — which already has more than 8,000 customers, including big names like Twitch, Slack, Discovery and LVMH — has closed a
Series C of $110 million, money it plans to invest in R-D around its search technology, including doubling down on voice, and further global
expansion in Europe, North America and Asia Pacific.This Series C is being led by Accel, with other investors in this round including
Salesforce Ventures (along with others that are not being named).The funding is coming at a time of strong growth for Algolia, whose basic
premise — to offer an easy-to-use, API-based search service for businesses, as a way to buy search tech rather than build from the ground
up using search platforms — has seen a lot of traction.It was already active in the various regions where it plans to grow: Founded
originally in France, Algolia is now based out of San Francisco and has been in Asia since 2014, most recently doubling down on business in
Japan, and when it last raised money in June 2017, it had only 3,000 customers.Algolia had raised $74 million prior to this, with previous
investors including Accel, Point Nine Capital, Storm Ventures, Y Combinator, 500 Startups and a number of individuals, among others.While
Algolia is not disclosing its valuation, the prospects for building a big, enterprise-focused search business are there
As a point of comparison, consider the enterprise search company Elastic, which went public in 2018 and now has a market cap of some $6.7
billion after being valued at a mere $700 million when it was still private
Even with 8,000 customers now at Algolia, this is just the tip of the iceberg: Algolia cites estimates that there are some 1.8 billion
websites and millions of apps on the market today.Having Salesforce as a strategic backer in this round is notable, as the CRM giant
currently does not have a native search product in its wide range of cloud-based services for enterprises, instead opting for endorsed
integrations with third parties, such as Algolia competitor Coveo
The plan will be to further integrate with Salesforce, although there are no products to speak of as of yet.“Algolia has been a great
search innovator and delivers unique experiences for customers across Commerce,” said Mike Micucci, CEO, Salesforce Commerce Cloud
“Algolia’s integration into the Commerce Cloud platform will continue to drive momentum and mutual success with our developer, partner
and customer community.”At a time when search continues to be a critical cornerstone for how an organization presents itself online, and
the effort to provide a counterbalance against the power of Google in search continues apace, this essentially gives Salesforce a financial
foothold in one of the faster-growing companies in the space.As my colleague Romain has previously noted in his coverage of Algolia, the
company’s unique selling point has been the fact that it provides a super-fast and effective search tool that you can integrate into a
site or app easily by way of an API.This in contrast to solutions that either are built in-house from the ground up, or rely on more lengthy
and more expensive integrations to get up and running
Alongside that, Algolia has more recently released supplementary tools, such as search analytics and A/B testing to help optimise results
and understand better what it is that site/app visitors want to know.The funding comes at an interesting time in the world of search
Google has effectively dominated the market for years with an open web approach to ordering the world’s information: the primary point of
entry is Google.com, and while you can tailor your results based on your search terms, the selling point is that you can search for anything
and everything.But in more recent years we’ve seen a big shift
Awareness of issues such as privacy and data protection have turned some off from the idea of open-ended browsing powered by advertising,
and as we and the internet itself has gotten more sophisticated, sometimes the open-ended search feels too wide for our purposes, and web
publishers themselves are less inclined to give over that search traffic to Google.That’s given rise to more focused vertical search
services, and — even more specifically — better search within sites and apps themselves
This is the context that has given rise to Algolia and others like it (for example Lucidworks raised $100 million in August).The landscape
is big, but it remains one that Algolia thinks best served by staying focused.“We have no plans to build a consumer service,” CEO
“There are a lot of companies like Amazon and Google doing a great job
We like to think of them as partners in a way, educating the whole world about search.”“Behind a world-class team of search experts and
a passionate customer base, Algolia has become the market leader in Search-as-a-Service,” said Nate Niparko, partner at Accel
“Algolia is accelerating innovation in personalized and intelligent search, enabling companies to deliver a great user experience that
drives improved business results
We are excited to double down on Algolia and support their mission to lead the search and discovery market.”
