In the age of social media, you’re only as good as your last like, and today a startup has raised a sizeable round of funding banking that the same maxim applies to software. G2 Crowd — a Chicago-based company that has built a platform for crowdsourcing enterprise software reviews to help others make decisions on what to use and buy — is today announcing that it has raised $30 million in funding at an undisclosed valuation, bringing the total raised to over $45 million.
The Series B round was led by Accel, with participation from Pritzker Group Venture Capital and G2 Crowd’s founders Tim Handorf, Mark Myers, Matt Gorniak, Mike Wheeler and Godard Abel (who founded BigMachines previously and sold it to Oracle for $400 million). And, perhaps most uniquely, the investor group includes LinkedIn, the social network for professionals acquired by Microsoft for $26.2 billion last year.
LinkedIn typically doesn’t invest in other companies — this actually appears to only be the third time it’s ever done so — and in this case Handorf, who is the CEO, tells me it’s because the two work closely together and may well do more in the future.
One of the most obvious places where it’s partnering now is in logins: G2 Crowd requires users to register themselves via their LinkedIn profiles in order to authenticate themselves and to help control against nefarious reviews of software from competitors and trolls. LinkedIn, in turn, cross-posts those reviews to users’ profiles, as part of a bigger bid to become the go-to place to manage and cultivate your public, professional persona.
“G2 Crowd is a highly respected company with great insights into the B2B environment,” a spokesperson said. “We occasionally invest in companies that can inform our long-term business strategy, and in this case, we believe G2 Crowd can help us better understand and address the needs of our customers.” Handorf declined to comment on whether the investment was part of an attempted acquisition but noted that the company has been approached by others in recent times.
G2 Crowd is part of a large group of entities that have sprung up online that provide reviews and competitive analysis about various software products. However, most of these, Handorf points out, are based around affiliate revenue models, where the sites make money whenever users click on the links of the companies listed in their competitive lists.
Instead, he likens G2’s business model more to that of Glassdoor’s, the company review platform: “We don’t have advertising or give preference to companies who pay us,” he noted, “and we don’t do lead generation.”
Companies, as on Glassdoor, get free profiles and they can claim them to add in more information about what they do, downloads and so on. The other area where G2 Crowd is hoping to build out its business is in areas of analytics and research — competing against the likes of Forrester, Gartner and IDC for profiles and sector analysis — and also into other adjacent areas of products that businesses might need to buy, be it consulting or integration services, or perhaps even who the best company is to cater an event.