An OC resident who’s an expert on “growth hacking” is now focused on the pursuit full time. Sean Ellis, who famously coined the term when he was at San Francisco-based Dropbox, just sold his survey business, Qualaroo, so that his team could focus on its sister business, GrowthHackers.
Growth hacking is a different way for marketers to grow their businesses from the inside out instead of relying on traditional, external means, such as Google ads, Ellis said. Any employee, under GrowthHackers’ model, can contribute ideas to grow their company.
Ellis, an OC native, left the area for 20 years before moving back in 2010. He acquired Qualaroo in 2012. The company installs surveys on other companies’ websites to uncover customer insights.
Ellis sold Qualaroo, formerly based in Costa Mesa, the week of March 29 to a Las Vegas group for an undisclosed amount in the millions. That freed him and his team to focus on GrowthHackers, also based in Costa Mesa, which he started as an online community for marketers to exchange ideas, he said.
GrowthHackers is now an independent software developer for marketers to manage their growth processes. It’s also a means of inviting employees across a company’s spectrum, including product teams, support teams and engineers, to contribute growth ideas. Ellis said it’s filled the void for marketers in the same way that San Francisco-based Salesforce.com did for salespeople, San Francisco-based Zendesk did for customer support, and Australian-based Attlassian did for software developers.
He started a private beta version of GrowthHackers early last year.
“We had the theory to build it, but until we could see how people engaged with it, we wanted to hedge our bets,” Ellis said. “But we found that people are living daily in the system. The daily and hourly activity is really high. We needed that validation before we were willing to take that leap and sell Qualaroo.”
The early community of GrowthHackers now has 150,000 registered members and will be integrated into the growth-management platform, he said.
Company Heads to Valley
A Newport Beach startup that provides on-demand food and retail items to airline travelers has been selected to participate in the Travel and Hospitality accelerator program at the Plug And Play Tech Center in Sunnyvale. AtYourGate was founded last year by P.J. Mastracchio and his team, which has grown to approximately 10.
It’s one of 20 startups chosen out of more than 1,000 that vied for spots, Mastracchio said. Plug and Play is one of the largest incubators in the country; its graduates include San Jose-based Paypal. Sponsors of the Travel program, which fork over $250,000 to work with the selected startups, include Forest Hills, N.Y.-based JetBlue and Germany-based Lufthansa.
Persistence paid off for the AtYourGate team, who crashed a cocktail party for Plug and Play finalists in December because their app wasn’t ready in time to formally apply. They got such a good reception that they were invited to pitch, Mastracchio said.
“The pitch was the most intense thing I’ve ever done. I played football at the University of Kentucky, but I’ve never been more nervous.”
The startup has raised $750,000 on a $7.5 million prerevenue valuation. Of that, $300,000 has been raised since its selection in Plug and Play was made public, Mastracchio said.
He credits Aliso-Viejo based OCTANe, with which he recently connected, for helping join his team with key players in the OC startup ecosystem.
“They really want us to stay in OC. My goal is to build the first billion-dollar brand in Newport Beach,” he said.
AtYourGate employees, who will go through the same background vetting as Transportation Security Administration employees, can access any restaurant or retail operation in any terminal and bring it to a passenger at any gate.
AtYourGate begins the 90-day accelerator program this week. It intends to debut its service this summer at two U.S. airports that it wouldn’t yet disclose.
Botox-Like Drug Developer Seeks Cash
A startup developing a drug that works similar to Botox just started raising its Series B financing. Newport Beach-based Bonti is seeking $20 million to use for its second phase of clinical studies. Chief Executive and President Fauad Hasan, a former Allergan PLC director of biologics manufacturing and development, co-founded Bonti after leaving Allergan last May following the pharmaceutical company’s acquisition by Parsippany, N.J.-based Actavis (see related story, page 1).
Bonti closed a Series A round in August that netted $9 million after an initial expectation of $6 million. For its Series B, Bonti was in the driver’s seat in choosing a top-tier investment bank to partner with, Hasan said. The company ultimately chose Boston-based Leerink Partners LLC.
Its lead product is a neuro-toxin, as is Botox, but it’s a different molecule. Hasan said it works much faster and is more conducive to treating certain ailments, such as muscle spasms, musculoskeletal pain and the recovery of muscles and joints due to injury or surgery. The $9 million is being used for drug development and to start the first human clinical study by year-end.
