Protocol | Workplace

Productivity apps can’t stop making money

ClickUp had one of the biggest series C funding rounds ever. Here's how it matches up to the other productivity unicorns.

ClickUp CEO Zeb Evans

ClickUp made $400 million in its series C funding round.

Photo: ClickUp

Productivity platform ClickUp announced a milestone Wednesday. The company raised $400 million, which is one of the biggest series C funding rounds in the workplace productivity market ever. The round, led by Andreessen Horowitz and Tiger Global, put the private company at a $4 billion valuation post-money.

In case it's not clear: This is a massive amount of money. It shows how hot the productivity space is right now, with some predicting that the market size could reach almost $120 billion by 2028. In a world of hybrid workers, all-in-one tool platforms are all the rage among both startups and productivity stalwarts. Companies everywhere want to escape tool overwhelm, where work is spread across dozens of apps.

"Our thesis around work software is that it's been very fragmented and broken and inefficient," said ClickUp CEO Zeb Evans. "Our future of work begins and ends with putting all of your work in one place."

ClickUp provides a set of tools on one platform, including knowledge hubs, project management, reminders, email and document collaboration. The company says it has more than 85,000 paying customers, including McDonald's and Netflix. It also says that more than 90% of customers use three or more products within the ClickUp platform. The company's first round of funding was in 2020, and it achieved unicorn status in December 2020.

Evans said product and user-led growth have remained his biggest focus as the company has progressed. In such a competitive market, there's little room for error, especially right when a productivity startup launches. When you get closer to unicorn territory, then you have to place a greater emphasis on sales and marketing. "You can't outmarket them, you can't outresource them, you really can only win on product at the beginning of your journey," Evans said. "It's about how fast you can put out those fires and fix things to keep the machine going."

With this new investment, ClickUp is working to expand globally and localize its product in every language. The company hopes to hire dedicated workforces in all the areas it reaches.

Though the goal is to have all work done in ClickUp, the company recognizes that people may not want to abandon every tool for its platform. "We aren't naive enough to believe that everybody wants to replace every single application that they have," Evans said. "We do play very nicely with not only competition but other integrations that are not competitive to us."

This isn't the single biggest round of funding for a productivity app: Before it was acquired by Salesforce, Slack raised $427 million in a series H funding round. Slack is one of the productivity companies Evans always admired for being an innovative disruptor in the productivity world, though he feels that Slack could have taken the company further. "They had an amazing outcome, don't get me wrong," Evans said. "But had they kept that fire lit under them, that innovation mindset of continuously iterating on their product and taking big bets, they probably could have been that category leader in our space."

Even if Slack did raise more money in a later round, for ClickUp to reach almost that level of funding in a series C gives it a significant leg up among the other private productivity unicorns.

Correction: This story was updated to reflect that ClickUp's first round of funding was in 2020. This story was updated on Oct. 28, 2021.

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