The investment makes Ascent the largest single investor in Detroit-based LevelEleven, which it says will provide financial stability so the company can continue to progress in the emerging sales activity management category. It also brings strong enterprise software experience to the business, according to Bob Marsh, LevelEleven founder and CEO.
He and Ascent’s founder and President Larry Leinweber would not disclose the investment amount.
“We were looking for venture capital and this came our way. We were not planning on this, but we liked (Ascent’s) offer and involvement in the company,” Marsh said. “They have a large financial position … but I’m still the CEO. They are adding some of their own expertise.”
Marsh said LevelEleven spent considerable time pursuing additional venture capital. “Now with this financial backing from Ascent, we can grow our software platform and pursue more customers,” he said.
The Ascent Group was formed in 2016 after its founders successfully merged their enterprise software company New World Systems with Tyler Technologies (NYSE: TYL) in a transaction that valued the company at $670 million. Troy-based New World grew to become one of the largest software companies serving state and local governments with more than $130 million in revenue and 500 employees.
“We spent months searching the country for the most promising software companies, and we are pleased that our first investment is in Detroit,” Leinweber, who is also the founder and former CEO of New World Systems, said in a news release. “We selected LevelEleven because of its strong team, impressive client roster, and their ability to help other companies maximize their revenue potential and improve their ROI using sales technologies like CRM.”
Ascent’s investments focus specifically on fast-growing software companies with $3 million to $30 million in revenue, an established customer base with recurring revenue, substantial growth potential and a proven team.
Ascent will become involved as owners and operators of LevelEleven. It will join the existing management team and an investor roster that includes Detroit Venture Partners, NCT Ventures and Salesforce Ventures.
Since last August, LevelEleven hired a chief revenue officer and a COO, taking its employee count from 25 to 28. It has eight people on its sales team and a seven-person engineering team.
Marsh told Crain’s a year ago that the company was generating revenue at a rate of $2 million a year and hoped to increase it 150 percent to 200 percent this year. Revenue now is up to $3 million a year, and Marsh expects it to rise more than 50 percent annually.
The earlier plan called for LevelEleven to raise a much larger round of venture capital by the end of last year. The investment by Ascent has surpassed those goals.
“With venture capital, you sell a piece of the company. Ascent made a different type of transaction — a secondary offering, which allows existing shareholders and employees to keep their shares and ownership in the company,” he said.
Its Software as a Service solution helps sales leaders take a metrics-driven approach to keep salespeople engaged in the activities that matter and leads to closing more business, according to the company. Customers experience instant ROI, like client Paycor, which increased new business meetings scheduled per salesperson by 45 percent and reduced new hire on-boarding time from six to three months by creating individual and team visibility around its performance.
By Marti BenedettiRead Original Article