Constant Contact: The latest IPO on the block

constant contact logoLast quarter set a record for the highest amount raised in venture backed IPOs since 2000, with 22 companies raking in 2.73 billion.

This quarter is starting with a bang - we talked about Netsuite filing to go public last week. Now, Constant Contact has decided to take the plunge, filing for an IPO this morning!

Constant Contact is an email solution that provides easy tools for marketing and customer relationship building. It allows management of email lists including providing handy features such as unsubscribe. It also gives detailed tracking information on email campaigns, including how many people actually opened your email, how many emails bounced back and how many ended up in the bulk mail folder.

The best use for constant contact is for simple management of customer contact (they have strict anti-spam policies so this would not be the tool of choice for junk mail marketers). New and growing businesses can use the package to easily generate attractive html emails and newsletters, and send them out in an automated fashion.

I have used Constant Contact in the past. While it has many features which are attractive to the user who wants to get going quickly with an email campaign, it lacks the horse power and flexibility to handle more advanced tasks such as controlling the rate at which emails are sent out from the server.

I have been most impressed by the fact that Constant Contact has had a solid revenue model from the start (and does not just go after eyeballs and the ever favorite “ad generated revenue”). It is a subscription based service, but it is free for the first two weeks or for emailing to the list of the first 100 people. Their stickiness comes from the fact that once you have uploaded your customer list to their database, you would reluctant to move to another product.

With $40 in revenue, the company is expecting to raise $86 million in its upcoming IPO.

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8 Responses to “Constant Contact: The latest IPO on the block”

  1. By Sunny Kalara on Jul 7, 2021 | Reply

    I am surprised at the revenue numbers for constant contact.

    I am rooting for them because we do need a good reliable way to send emails to a list that doesn’t end up in the spam folders.

    If they are big, they can make deal with Yahoo and AOL and others to make sure that the emails are not automatically directed to the junk mail.

    I would even pay slightly higher price to achieve that.

  2. By Val Staricov on Jul 7, 2021 | Reply

    You can send a lot of emails for $40M.

  3. By Ashu on Jul 7, 2021 | Reply

    What is this about money loosing companies doing IPO all over again.

    An on-demand email marketing company that hasn’t made a profit in its first 12 years, Constant Contact notched up losses of $11.6m last year on sales of $27.6m.

    Just a few months ago, I would have rated them at 4 or 5 out of 10 for going public.

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