Sequoia Leads $20 Million Round for Evernote—Q&A with CEO Phil Libin
Evernote, the Mountain View, CA, startup building a multiplatform service that helps consumers organize and retrieve all the digital bric-a-brac in their lives, has just taken a big step forward, raising $20 million in a Series C investment round led by top-tier venture firm Sequoia Capital.
Some 4.7 million people use Evernote’s freemium service, which offers cloud-based storage of Web clips, documents, images, audio files, and other data and lets people access their “notebooks” via the Web as well as Windows, Macintosh, iPhone, iPad, and Android client software. When I last spoke with CEO Phil Libin in June, the company had just 3.2 million users, meaning that the service is adding 300,000 to 400,000 users each month.
In an announcement today, the startup says that the new cash, which comes on the heels of an $11 million Series B investment from Morgenthaler Ventures last fall, will be used for “rapid product development and expansion into new markets.” Besides placing a higher value on Evernote, which is good for its previous investors, this means Evernote is in a position to grow. Users will see a greater selection of options in the Evernote Trunk, a showcase of products and services that integrate with Evernote. This has already started to happen: just last week, for example, Evernote announced that users of the LiveScribe digital pen can now import their notes directly to their Evernote notebooks.
Sequoia’s Roelof Botha will join Evernote’s board as an observer as a result of the firm’s growth-stage investment, which was supplemented by funds from existing investors Morgenthaler, DoCoMo Capital, and Troika Dialog. “Evernote’s success shows that there is a major market demand for products that help us make sense of our over-saturated lives,” Botha said in a statement. “In a very short time, Evernote has changed the way users interact with all of their devices, and the way they keep what’s important to them close at hand. With nearly 5 million users, they have also proven the viability of a freemium business model. We’re excited to be a partner in the company’s continued ascent.”
For more on the company’s product expansion plans, see my Q&A below with Libin, whom I reached by phone this morning in Japan. Here’s an edited transcript:
Xconomy: This is a big up round for you, congratulations. Why did you need to raise $20 million?
Phil Libin: We always had pretty ambitious plans, it just wasn’t really feasible to get the resources to do them before. In our last round, we raised $11 million from Morgenthaler, and that put us in a really good path of organic growth. We are self-sustaining and still had the vast majority of that cash left. We’re growing pretty quickly. Sequoia saw the possibility of … Next Page »