Why We Invested in Scratchpad
Today Craft Ventures is excited to announce that we are leading the $13M Series A in Scratchpad, and I will be joining the board.
Scratchpad is a workspace for sales teams as well as others in revenue-related functions. It provides a beautiful and lightning-fast interface to take notes, record to-dos, and update the status of deals – with everything instantly flowing back into Salesforce. Sales reps love it for its speed and ease of use, while sales management and operations love it because it encourages real-time updates and data hygiene.
What got us most excited about Scratchpad is its viral spread within sales organizations. Its freemium model lets any sales rep sign up, connect their Salesforce.com account, and start using the product. Once a rep starts using Scratchpad, two things tend to happen: 1) it becomes a daily habit, and 2) they share it with their teammates.
I wrote about its habit-forming nature in my blog Measuring SaaS Engagement. The data in that blog is actually from our Scratchpad diligence. While not at first apparent, when we dove into the product usage data and isolated weekday usage among paid accounts, we saw that sales reps use Scratchpad almost 4 work days every week, which is best-in-class. This explains Scratchpad’s viral spread: once one rep uses it, it takes hold in an organization and the number of users grows rapidly.
With rapid adoption and habitual usage among sales reps, plus alignment with sales ops and sales management goals, Scratchpad has a natural entry point to negotiate paid contracts. I’ve described this Enterprise Freemium approach as a “best of both worlds” sales motion because it combines enterprise budgets with the velocity of an SMB-like sales cycle. Scratchpad has used this sales motion to rapidly add customers from great sales organizations like Autodesk, Brex, Front, ProductBoard, Sendoso, Snowflake and Twilio – and they’re just getting started.
Scratchpad joins Craft’s portfolio of bottom-up SaaS companies like ClickUp, Sourcegraph, and OpenPhone who have mastered this type of go-to-market motion, which combines B2C growth tactics with a B2B revenue model. There’s nothing better than when ARR goes viral! This keiretsu of bottom-up SaaS companies are already sharing best practices and learning from each other.
The founders of Scratchpad, Pouyan Salehi and Cyrus Karbassiyoon, have been working together for almost a decade, having previously founded PersistIQ, an email automation tool for sales. They are extremely sharp product minds who have an ideal background to lead and grow Scratchpad. We are excited to support them in their mission to transform the workflows of sales reps.
Scratchpad founders Pouyan Salehi and Cyrus Karbassiyoon.