Postscript, an SMS marketing company, raised $65 million in Series C funding and will usher in more ways for brands to personally engage with their customers.
We previously checked in on the company last year when it took in $35 million in Series B funding to continue helping Shopify stores stay in touch with customers via SMS. We also profiled Postscript when it raised $4.5 million in 2019.
In 2021, the company had 61 employees with over 3,500 customers. Today, that has grown to 230 employees and its brand base on Shopify has more than doubled to over 8,500 brands, company CEO Adam Turner told me. It now includes brands like Brooklinen, Homesick, Native, Spikeball and Kopari. In addition, the company more than doubled its revenue.
On average, customers see a 25-time return on their investment using Postscript, Turner said. One of the biggest days the company looks at for traction is Black Friday, but this year, Memorial Day became the company’s largest SMS sending day. He says between 30 and 40 million texts were sent compared to an average of between 5 and 10 million.
He went on to explain that while merchants are worried about a recession, Postscript’s return, essentially $25 for every $1 they put in, enables them to lean into the SMS strategy. For example, merchants who have been using this approach for the past 1 or 2 years are driving 40% of the gross merchandise volume for their stores, he added.
“Merchants are having success, even as Facebook advertising costs increase, and are seeing customer lifetime values stay high,” he added. “They are also more sophisticated and are using SMS as a two-way platform to reply to customers to create a purchase. That creates more value to the end user because it is not just a billboard, but an interaction channel where you can reply and get support for your purchase.”
The company went after new funding after seeing that e-commerce sales via SMS in the United States account for 16% compared to sales via communication systems, like WeChat, where it is 26%, Turner said. “We want to bring the U.S. into the modern times of e-commerce and retail by helping merchants develop relationships and other channels outside their websites,” he added.
Postscript will continue working with Shopify merchants, but the new funding also gives it an opportunity to work with some of its best customers on other platforms. Turner also intends to deploy the funding across sales and marketing, go-to-market and product engineering.
There is still a challenge to provide personalized experiences to customers, but Turner believes that Postscript is creating the best possible approach for using SMS marketing and will continue to build more features with those customers in mind.
Dick Costolo’s venture firm 01 Advisors led the new investment that included participation from Twilio Ventures, Expanding Capital and m]x[v Capital and existing investors at Greylock, Accomplice, Elephant and OpenView. In total, Postscript raised over $100 million in venture-backed funding since the company was founded in 2019.
“In the same way texting changed the way people communicate with each other, Postscript transformed how brands communicate with their customers,” said Costolo in a written statement. “We invest in companies with strong product market fit that are focused on further innovation and scale to bring them into their next phase of growth, and Postscript is the epitome of this profile. They are the future of commerce.”