Hugs, hollers and high fives echoed around the Silicon Valley offices of Wildfire at the end of July when many employees first heard that Google had bought the social media marketing software company.
There have been tears of joy, too, at the cash price which, including staff retention incentives and earn-out bonuses, is believed to be around US$450 million.
Not bad for a company that morphed from a side project Kiwi CEO Victoria Ransom and vice-president of product management Alain Chuard started a little over four years ago.
It was while trying to use Facebook to help market their previous travel company, Access Trips, that Ransom and Chuard developed an application making it easy for businesses to run giveaway sweepstakes on their brand pages.
“It was definitely meant to be a side project,” says Ransom. “But that’s how Wildfire got started.” Ransom, though unable to discuss details of the Google deal, described the sale as a “dream result”. The couple can expect to share roughly half the sale proceeds.
“We felt Google would be such a great fit for us,” she says, recalling how Wildfire’s meteoric rise at the intersection of software technology and social media caught the tech giant’s attention.
“Not only are they the world’s most successful marketing company but they really have a culture that aligns with Wildfire — they care a lot about their employees and do a lot for them. They’re also really innovative and dynamic. So it really felt like a great offer and a great opportunity.”
The software, initially free, quickly began attracting more interest than expected, including from major players like online retailer Zappos, travel site Kayak and Sony Pictures.
As Wildfire gained traction, its potential became more apparent — Ransom and Chuard saw how it could be used as a much broader marketing tool across a variety of social networks and company websites. In the summer of 2008, having sold Access Trips, the pair shifted from Boston to Silicon Valley and became software entrepreneurs.
Instead of the fabled startup garage, they worked from their flat. Chuard managed the software developers and focused on product development and design, Ransom became the public face, covering marketing, sales, business development and fundraising.
“For a long time we didn’t need funds,” she says. “We bootstrapped. We used our own money. We lived frugally and we had some income from Access Trips.”
The first infusion of funds came in late 2008 when they won a US$250,000 grant from the Facebook Fund. At that stage Wildfire was just Ransom, Chuard and two Estonian software developers in Estonia they’d found online. With the extra cash they employed two more developers in New Zealand.
A small investment from Facebook in the summer of 2009 enabled another significant step — adding one person in sales and one in customer service, both of whom are still there.
About that time they launched a revamped version of their software that spread like, well, wildfire. “Pretty much within the first couple of months we were profitable,” recalls Ransom.
Then, as Wildfire exploded to thousands of users, it was time to move into real offices — above a Mexican deli in nearby Palo Alto.
By year’s end it was clear they needed more salespeople and in January 2010 they added two more, then another developer, then a marketer … and it began to snowball.
Ransom and Chuard kept control of Wildfire by using minimal outside capital: a US$4 million Series A in April 2010 and another US$10 million at the end of 2011, both from private equity firm Summit Partners. Today the company employs roughly 400 people at offices in Silicon Valley, Los Angeles, Chicago, New York, London, Paris, Munich and Singapore.
It has around 16,000 clients including household names like Facebook, Coca-Cola, Microsoft, McDonald’s, Pepsi and Air New Zealand.
Despite new ownership, Wildfire will likely be business as usual. Ransom, 36, says she and Chuard, 38, will be staying on “for several years”, having shifted to Google’s campus with their staff.
Though Ransom and Chuard are committed to Wildfire for some time, don’t rule out another startup. “We really love this Silicon Valley tech industry,” Ransom says. And then, as if to underline the point: “I certainly don’t see us retiring and playing golf.”
What is the biggest challenge your small business is facing in 2014?Related story: (See story)