Japan’s From Scratch raises $8M to enhance integrated digital marketing platform



See the original story in Japanese.

Tokyo-based From Scratch, the company behind an integrated digital marketing platform called B->Dash, recently announced that it has fundraised 1 billion yen (about $8.3 million) from Global Brain, Dentsu Digital Holdings, and Nippon Venture Capital. Details such as a payment date and stock shares were not disclosed.

This follows their first funding of about 300 million yen ($2.4 million) from Draper Nexus Venture Partners and Itochu Technology Ventures in May. The company will enhance their workforce to promote the development of big data and artificial intelligence, while developing markets and enhancing service features for SMBs (small and medium-sized businesses).

From Scratch CEO Yasuhiro Abe says the active marketing automation market encouraged this funding. He also addresses that their marketing platform B->Dash is used by more than 100 companies.

Abe explains:

At the time we fundraised this May, we were planning our next funding next year. However, the business in this field is booming, and most of all, we have been growing more than we had expected. In these surroundings, the only question we have is “who is going to dominate this field?” you see. This is why we decided to take early action.

A previous interview revealed that this service is not budget-pleasing by any means. Their clients are supposed to be able to invest 3 to 5 million yen (about $2.5 to $4.1 million) monthly on the digital marketing budget, and a monthly cost starts from half a million yen ($4,100) with the extra cost charged depending on pageviews (12-month contract).

From the fact that more than 100 companies decided to use this service only within a year after its launch despite of its high cost, it can be assumed that their services match the market needs perfectly. A quick math shows that the company sold more than 600 million yen (about $4.9 million) a year. Marketo and Hubspot from abroad are often considered as the competitors.

Abe continued:

We explain to our clients that we are offering a system in which the business operates 24 hours a day, 365 days a year. Clients can choose between hiring a person who handles that operation and utilizing a tool which handles that operation.

While the company is growing steadily, the more the company provides quality consulting support services, the more the company needs bigger operating capacity. The company is now looking at big data and artificial intelligence as solutions for this issue.

Simply put, from big data, they are trying to identify support patterns which their consultants are currently dealing with, and to use that as a system so that consulting services can be conducted by the system.

Abe claims that the “marketing automation” market is not that large, and thus their further success depends on how they can automate the system to enter the small business field.

Translated by Moto Tsujino via Mother First
Edited by “Tex” Pomeroy and Masaru Ikeda