The headquarters of tech startup Buzz360 may be in Uptown, Minneapolis; but most of their hiring, and their investment money, is coming from the North Dakota prairie. The startup, which offers a marketing automation software specifically designed for small businesses, is funded primarily by the Bank of North Dakota and has employees working remotely in Fargo, Grand Forks and more…and they’re hiring.
The company, which was founded about three years ago, is in the midst of a growth spurt; in the first three months of this year they saw enough growth to far exceed their revenue of last year, according to CEO and co-founder Lisa Schneegans. And it’s all based on something she heard over and over again during her career in IT at American Crystal Sugar, in building an e-commerce company which she sold to SAP in 2006, and perhaps in being married to a husband who she says has always been an entrepreneur.
“When we started out, we heard over and over again that they [people] start a business because they have a passion. Typically their passion is not sales and marketing,” Schneegans, a Fargo native, said. “We started out wanting to help those businesses.”
Buzz360 is a software that allows small businesses to sign up for what is essentially a Marketing 101 package. Depending on how much you want to pay, and the prices vary from $35 a month to $99 a month, users get the tools to start a company website, run e-mail and social media marketing campaigns, all with built in search engine optimization (SEO).
Although their end goal is to equip small businesses with marketing tools, their target audience is a lot larger. Schneegans explained how they follow the business model much like the franchisor-to-franchisee method; rather than cater to the franchisee, they look to the franchisor. In other words, they cater to bigger companies that have relationships with small businesses in order to grow.
“That structure allows us to go after one company and have access to 200 startups,” Schneegans said.
Currently through that model they have close to 1,000 small businesses using Buzz360 software, Schneegans said. Customers vary from newspapers that have access to various small businesses, chamber of commerce entities that have connections with small town restaurants and other local businesses, and political parties that have access to a individual candidates and campaign managers.
“We’re working with the Minnesota GOP, and all those candidates are using our product,” Schneegans said. “People often don’t think about it, but a politician is a business. They are marketing themselves.”
In the past three years since they white-labeled the business, they also received an investment of $385,000, in part from University of North Dakota based investment group Dakota Venture Group and individual investors Howard and Brian Dahl. Since then they have closed on another funding round, the total amount Schneegans said is confidential.
The Buzz360 software is the product of years of work in the software world. Both Lisa and her husband Klaus, who is co-founder and CFO, spent their early career in the software industry. That said, they’ve seen immense change as well.
“When we started out with our e-commerce product, the whole SaaS model was not around. Cloud wasn’t around either,” she said.
And, as the world of software often requires, they continue to adapt and grow with the changing landscape. One of the next steps on the horizon is creating an interface that automates the accounting side of a small business, Schneegans said. Thanks to funding from the Bank of North Dakota, they plan to continue their growth in North Dakota.
“We have the same goal,” she said. “To bring more jobs to the area.”
Photo courtesy of Buzz360.