Pingboard, a business to business (B2B) Software as a Service (SaaS) company, announced its latest $5 million round of seed funding led by Active Capital. The San Antonio-based venture firm is focused on leading seed rounds for founder-led, B2B SaaS companies. Pat Matthews, founder and CEO of Webmail.us which was acquired by Rackspace in 2007, decided to launch Active Capital in 2016.
This is Active Capital’s 10th deal to date. Other deals have been with startups located in cities across the U.S. like Super Dispatch in Kansas City, which automates software workflows and payments for the trucking industry.
Bill Boebel and Rob Eanes founded Austin-based Pingboard in 2013 when they incubated the concept at the Capital Factory. Pingboard’s software is used to create and maintain changing organizational charts easily as businesses grow and change structure. The software also updates org charts automatically by integrating with a company’s existing human resources system. Pingboard has more than 1,000 paying companies in 39 countries as customers, including Demandbase, POPSUGAR, Khan Academy, Charlotte International Airport, Udemy, WP Engine, and GoFundMe, to name a few.
Boebel, who is also Pingboard’s CEO, was the chief technology officer for Rackspace Email and Matthews’ co-founder at Webmail, the largest business-grade email hosting company at the time. Boebel also co-founded Capital Factory, which supports startups in Austin with entrepreneurial resources.
With this latest financing round, Active Capital partner and co-founder of Rackspace Pat Condon will join Pingboard’s board of directors. Participants in the round include Pingboard founder and CEO Bill Boebel, Silverton Partners, and Capital Factory. Pingboard has raised $7.5 million in venture funding and has grown to 14 employees, a startup positioned for more growth.
“We’re very grateful to raise this seed round in a way that aligns with the values and operational model of our company,” stated Boebel. “Active Capital is the perfect partner for us because of their founder and operator backgrounds, focus on B2B SaaS companies at the seed stage, and commitment to more agile modes of funding and governance that reflect how SaaS startups are built today.”
Matthews recognized the potential for Pingboard’s growth because their org chart and workflow tools address a pain point that is common across industries—the need to visualize the business structure with current org charts as founders plan for change and growth. This particular deal was a special one for Matthews as well because the co-founder of Pingboard was also his co-founder at Webmail.
“We look for founder-led companies that have launched products and have growing monthly recurring revenue,” Matthews said. “We like to spend time with founders and pour our energy into helping them become great CEOs and leaders of their companies.”
Matthews is both founder and venture capitalist in Active Capital, with partner Cat Dizon in charge of operations and due diligence and partner Pat Cordon working with founders in their portfolio.
“We focus on early-stage startups that are post revenue but pre-series A funding rounds,” Matthews said. “This is the new seed stage for software companies that already are generating revenue but need investment for growth.”
Pingboard was a match with Active Capital’s approach to investing.
“SaaS companies’ capital requirements and trajectory require a different approach,” Boebel wrote in his blog post Thursday. “We may become rocketships, but our gestation cycle is longer.”
Matthews is ultimately interested in building a network of B2B SaaS companies “because CEOs of growing SaaS companies share common issues and opportunities regardless of what use case they’re building or industry they’re serving,” he told Startups San Antonio.
Matthews started his journey as an entrepreneur as a student at Virginia Tech who left university to start a dot-com business with Boebel and Kevin Minnick in 1999. Their efforts culminated in Webmail, a SaaS platform for business email hosting they launched in 2002. Once Webmail grew to $10 million in revenue the co-founders sold it to Rackspace in 2007 for $50 million, and Matthews eventually found himself in San Antonio working at Rackspace until 2013.
“Since leaving Rackspace, I’ve been working on a variety of projects, from angel investing to CEO of Filestack,” Matthews said. “What I realized is that I wanted to combine the entrepreneur in me with my love for investing and advising, so I decided to start my own venture firm.”
Matthews’ unique experience and expertise shapes Active Capital’s approach to investing in B2B SaaS companies and guiding fledging founders who are growing into successful CEOs.
“I went from failure in the basement to senior leadership at a publicly traded company,” Matthews said. “Most founders don’t make it through that entire journey. I have experience starting something from nothing, growing that into a viable company, and hiring and firing lots of people at a big company.”
He also maintained his co-founder relationships which led to the Pingboard deal.
This personal journey as a founder, CEO, and investor is what shapes Active Capital’s nationwide search for startups that possess the potential to scale up for growth. Matthews explained that venture capital is fragmenting with over 500 small seed angel groups across the country.
“As entrepreneurs figure out who they are they search for venture firms experienced in B2B SaaS, (while) I’m looking for total alignment with the companies I invest in,” Matthews said. “I want to combine my entrepreneurship with my love of investing and help founders who start startups grow into the CEO role as leaders of their company.
“Our mission is capital plus counsel—we provide investment + advice. It’s what makes us different.”
Featured image is a screenshot of Pingboard’s organizational chart building software tool.