Today Toronto-based OMERS Ventures announced that it would be investing $20 million in Vancouver-based HootSuite, by way of a secondary purchase of ownership stake from the company’s existing shareholders. OMERS Ventures was formed last year, as a venture capital investment wing of the OMERS pension fund. Its Managing Director Derek Smyth told BetaKit in an interview that the venture firm thinks HootSuite is just at the beginning of its growth arc, which is why the time was right for an investment.
“We are just at the beginning of a massive trend where the whole enterprise, not just marketing, must integrate in a meaningful way to the social web,” Smyth said. “Hootsuite was an early leader, and continue to be as this market grows.”
Smyth makes a good point; social media use among buisnesses often now extends well beyond just the marketing silo, involving customer service and support, sales and even HR. HootSuite’s major appeal may have originally been vested mostly in its ability to plan and schedule coordinated social media marketing campaigns, but it offers the ability to work for enterprise users in a much more general way as needs evolve.
There are others out there trying to meet the same needs, though often in specific verticals or with fewer social network integrations than HootSuite, but according to Smyth, none is better-positioned to take a leading position in the market.
“HootSuite has great market position with almost 4 million users and an excellent product suite that is compelling to the enterprise,” he said. “They are gaining users fast, because it penetrates the enterprise by individuals within and gets driven throughout.” He also added that HootSuite has an advantage since “the team is world class.”
HootSuite may not have the flashy public attention of something like an Instagram, but that’s because it’s largely an invisible service from a consumer perspective. The company’s strategy of building out a comprehensive social media management tool has already attracted customers like PepsiCo, FOX and the NBA, the company noted in its press release, and enterprise users are jumping on board with new hot social tools like Pinterest as soon as they see consumers using them. If HootSuite can continue to evolve its social media integrations in step with consumer taste, and offer a more appealing, more generally useful tool than niche players like Pinerly, there’s no reason to believe it won’t continue to lead the way in this space, as Smyth believes it will.
