When Sagetap founders Sahil Khanna and Kevin Hughes began working at early-stage enterprise software startups, they were surprised to discover that the corporations they worked for were trying to sell their revolutionary technology using old methods, comparable to multiple cold emails and phone calls.
Khanna, a former product marketer, and Hughes, a former sales manager, knew that these methods weren’t effective in either selling software or helping buyers get the solution they needed. They decided to try to build a higher way.
“Company management is frustrated, their emails are destroyed,” Khanna, CEO of Sagetap, told TechCrunch. “As they say, there are too many suppliers to keep track of. They don’t know who is credible.” By comparison, there are nearly 400 enterprise tech unicorns and countless other smaller startups, according to CB Insights.
Khanna and Hughes launched Sagetap to try to solve these problems. Sagetap spent its first 12 months as a platform designed to give buyers a place to search and discover options. With this strategy, the company achieved an ARR of $1 million, Khanna said, but decided that Sagetap ought to be greater than just a place for buyers to gather intelligence.
Therefore, based on research, Sagetap built an artificial intelligence-based marketplace. Currently, potential customers can browse Sagetap’s database of software providers who have been vetted for presence on the platform and pay a subscription fee to remain on the list. For each supplier, buyers can access intelligence information, including publicly available information, purchase prices, and anonymous feedback and insights that Sagetap’s AI draws from sales conversations conducted through the platform. The marketplace uses artificial intelligence to rank its providers and recommend options to users, matching them with corporations that meet their criteria.
“This industry is huge, it’s a $1 trillion business,” Khanna said. “It’s broken. Buyers and sellers, there’s a lot of friction. We looked at what’s happening with Uber and Airbnb, and it’s produced incredible performance [through] to the market and I thought this would happen with the sale of the company [industry]”
The San Francisco-based company claims to be profitable, getting cash through vendor subscriptions and appointments booked on the platform, and this month announced a $6.8 million seed round led by NFX with participation from VCs including Uncorlated Ventures and Emergent Ventures. 15 of their clients, comparable to Oracle, Dell, SecureFrame and Descope, who were the organizers of the round from the starting, also participated in the round.
“We didn’t apply for funding initially,” Khanna said. “Our customers initiated this. Several technology executives asked us to invest and we decided to start a company.
Enterprise software spans several different categories, and Khanna said Sagetap began in the areas buyers are most interested in without delay, including cybersecurity, artificial intelligence infrastructure and programming.
While Sagetap is not the first enterprise software marketplace, and large organizations like AWS host their very own platforms, Sagetap believes it stands out because of the way it uses artificial intelligence to analyze sales inquiries for recommendations .
Since the AI renaissance really began to take off in 2022, many corporations have been looking to streamline their enterprise software sales process with AI. However, many of them have grow to be seller-centric and are not offering a recent model, but somewhat are simply automating an aspect of the existing one, whether that is using generative AI to create sales pitch emails or using the technology to higher acquire potential customers. What Sagetap does actually looks and feels fundamentally different.
Khanna said she receives many offers from VCs who want to make it easier for people to find their portfolio corporations. This suggests the platform may very well be useful as a way for enterprise software startups to promote their business to large buyers who would otherwise overlook them. While this strategy is good for visibility, in many ways it resembles a pay to play game. Sagetap says it only allows vendors onto the platform that it has vetted for customer engagement, financing and market traction, but 73% of vendors that have contacted us are eligible to list.
But buyers seem blissful. Over the past five years, Sagetap’s customer base has grown to 5,000 and revenue has grown 2.7 times year-over-year.
“The engine is running,” Khanna said. “We are seeing really strong growth. Next year will really be about growing our community of technology experts, increasing our visibility in the market and actually doubling down.”