Handshake, a New York-based startup founded by two Aussie ex-pats that offers an iOS and Web based sales and order management tool for B2B commerce, has notched up a significant milestone. Its eponymous app has been used to write over $100 million worth of orders since its open beta period ended in mid-2011.
"In the year since we went paid, we've had 30 per cent month-on-month revenue growth, which is a pretty strong number given that we basically had no marketing budget it all. The product has had to sell itself," Handshake CEO Glen Coates says. Businesses pay for the app on a per-user subscription basis.
"In the last six or so months our engineering team added three members, so now we've got including myself four engineers on board. It is a lot of growth in a short space of time, especially considering we're bootstrapped and have to pay salaries out of our actual revenue," Coates says.
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Coates, a former University of NSW computer science student, founded Handshake with Michael Elmgreen, a University of Technology, Sydney graduate who is the startup's head of business development.
Handshake is expanding its offerings, with a new product, Handshake Pitch, currently in beta. Pitch lets sales reps prepare a 'shopping basket' for buyers' approval, making sales quicker and easier for both parties.
"If I walk into a Bloomingdale's, the checkout counter girl really doesn't know anything about me. The difference in B2B land is that the sales rep typically does know their buyers pretty well and so they have a very good chance of picking out things that that buyer is going to want. The other big difference between B2B and B2C is that in B2B you just buy way more stuff," Coates says.
"If I'm the sales rep and I've got this buyer that I've worked with for 10 years and we've got some new product that's come out, I'm pretty sure I can pick maybe 80 or 90 of the styles that that buyer is going to want and that I know are going to sell well."
Using Pitch, a sales rep can send a buyer a prefilled shopping cart of products based on what the rep knows about the buyer. The buyer can then view it and remove or add new products before approving it. "The key is that the [sales rep has already] done 80 or 90 per cent of the work for them," Coates says.
"So I've said, 'Here's a bunch of stuff I know you're going to like and is going to sell. I've gone through this arduous process of choosing it all for you and you just need to get us over the finish line.' In B2B, buyers will appreciate that. Ultimately for them buying is a job, it's not a bit of fun on a Saturday.
"It's better for the buyer — they've got less work to do and they're getting probably higher sell through items —and for the sales rep it's great because he's just increased the chance of getting that order written, he's increased his sell through rate."