Smartly.io, a Helsinki-based company that makes automated marketing software for Facebook advertisers, announced today that it has raised $20 million in secondary funding by selling existing stakeholder’s shares to venture capital firm Highland Europe.
Founded in 2013, Smartly.io founder and CEO Kristo Ovaska says it has been profitable for two years already. All of its employees own shares in the company, so the secondary funding was a way to reward them, along with early angel investors and the founding team, without putting pressure on Smartly.io to find an acquirer or hold an initial public offering.
Ovaska adds that Highland Europe, which works closely with Highland Capital Partner in the U.S., will help Smartly.io build its global management team as it targets expansion in the U.S. and other countries and give it access to capital to fund potential acquisitions or a more aggressive growth strategy.
A Facebook Marketing Partner (the program created by Facebook to help advertisers select marketing tools that it’s already vetted), Smartly.io’s tools automatically creates banner ads and videos from product images. It also handles audience targeting and budget allocation, deciding when and where to purchase advertising.
Smartly.io recently announced that it had reached a $1 billion run rate in ad spending on its platform. It currently serves more than 500 agencies and brands, including eBay, JustFab, Zillow, SkyScanner, Lazada and Deliveroo.
In order to keep up with changes to Facebook, Smartly.io launches new formats and tools for the social network’s advertisers every week, though its goal is to become multi-platform, covering Google, Pinterest and Amazon, too.
“We are now 150 people and we are scaling rapidly. Highland has experience listing companies in the U.S. They bring expertise in hiring and customer acquisition,” says Ovaska.
“Also, we want to reward the team. It’s only fair to reward the team for the job they have done so far. At the same time, it also reduces the risk for European tech companies where you do an IPO way too early when it’s not necessary from a customer perspective or to build the company or product.”
All of Smartly.io’s customer support is handled in-house and most of its salespeople have coding experience. Even Ovaska still handles several hours of support every other week. He says the company’s emphasis on customer service helps Smartly.io compete with other marketing automation tools.
While Smartly.io also has an office in Singapore for customers in the Asia-Pacific region, its most important market continues to be the U.S.
“It still has the most significant growth potential. If you look at Facebook global ad spending, the U.S. is larger than all other markets combined and it also represents the most mature market,” says Ovaska. “We are investing heavily in the U.S.”