Coherent Path Inc., a Cambridge-based maker of cloud-based technology that allows retailers to tailor their marketing efforts toward each individual customer, has raised $6.25 million in venture funding. The Series A investment was led by Boston-based venture firm Sigma Prime Ventures and Wellesley-based venture firm GrandBanks Capital, with participation from Cambridge-based startup investing group CommonAngels.
The money will be used to expand the company’s sales and marketing teams. Currently, the startup has under 20 employees working out of a Cambridge office and plans to double its staff by the end of the year, said Coherent Path founder and CEO James Glover.
Other investors that contributed to the Series A round include Boston-based Dunnhumby Ventures and New York City-based BOLDstart Ventures. The latest Series A funding brings Coherent Path’s total funding to date to nearly $8 million.
“We think it’s great validation of our message, our progress, and the success we’ve had,” Glover said in an interview. “It’s outside validation that says we’re on the right track with this story we’re bringing to market.”
The software-as-a-service company was founded in 2012. Using a patented, cloud-based technology that incorporates math and tech, the startup can leverage big data and predictive analytics to help retailers deliver personalized offers and promotions to each individual customer through different channels such as email, mobile and websites.
The company says its customers, which include chief marketing officers of companies, have seen a 20 to 40 percent increase in revenue and other engagement metrics such as email click-throughs, revenue per e-mail, time on website and even in-store traffic driven by email campaigns.
“As opposed to thinking about the next thing to sell to the customer, it’s about creating a long-term relationship with the customer,” Glover said. The company is currently generating revenue but not yet profitable, Glover said. He declined to name the company’s current customers but said its target demographic is Fortune 500 companies and large e-commerce companies.
New technology for CMOs
The Coherent Path investment is in line with other Series A investments that Sigma Prime Ventures has made in software-as-a-service companies that aim to improve the way chief marketing officers do business. Other portfolio companies in this space include New York-based Contently, which offers software that helps companies with content marketing and personal branding; and New York-based Ceros, which offers software and analytics for designers and marketers to publish high-quality Web-based content on the Web without the need for coding.
Executives at Sigma Prime Ventures say the firm is investing in these companies because CMOs are seeing a larger need for using technology, analytics and software in their roles. Paul Flanagan, managing director for Sigma Prime, said today’s chief marketing officer needs more digital tools to get the company’s product in front of customers and generate leads.
Twenty years ago, a CMO might have been focusing on advertising copy or how to present a product in a publication, with very little attention to digital presence and technology, Flanagan said.
“Now, I look at CMOs and I think these are people who need to have a lot more tools to figure out how to measure every single thing they do,” he said in an interview. Nowadays, more money is being spent by CMOs on software products and analytics technologies that help generate leads and track progress, he said. A company like Coherent Path has the potential to vastly improve the way CMOs do business, said Flanagan, who helped lead the investment.
“Coherent Path takes personalization to the next level,” he said. “It’s about bringing mass customization to marketing so (a company) can market to your thousands and thousands of customers personally.”
Editor’s note: This post originally appeared on Boston Business Journal