It’s been a good week for Portland startups. Jive Software, which is headquartered in Palo Alto but started in Portland and still has many employees here, launched its IPO. And now SurveyMonkey, another Portland startup, has acquired MarketTools, one if its biggest competitors. The combined company is now valued at $1 billion According to the New York Times’ Dealbook.
SurveyMonkey was founded by Chris and Ryan Finley (who are not related to me). In 2009 it sold to a group of investors lead by Spectrum Equity Investors. The group appointed a new Palo Alto based CEO David Goldberg while the Finleys stayed in Portland and retained a minority share. Earlier this year SurveyMonkey acquired Infinity Box, makers of an online form creation tool.
According to Dealbook, SurveyMonkey is profitable. In an interview last year Goldberg told me that the company has 100% of the Fortune 100 as customers. SurveyMonkey’s track record and valuation is a big validation not just for the Portland startup scene, but for the freemium model that it and other companies, such as Box and Yammer, have adopted. Goldberg said the company didn’t have sales people, the whole business was built on its freemimum model. These companies are finding their way into organizations based on their own merits, not pushy sales people, and demonstrating their value. Freemium has been changing the rules of enterprise software deployment, and well established companies like Salesforce.com are starting to offer freemium products, such as Chatter.com.