CHICAGO (Built In) — Channel IQ announced this morning a $12M investment from Ohio-based venture firm Drive Capital. This is Channel IQ’s first institutional investment, and it is aimed at expanding the company’s scope and adding a number of new jobs.
“We definitely want to get the word out there that we’re looking for top technical talent,” said CEO Wes Shepherd. Channel IQ currently has 75 employees and hopes to hire another 65 people over the next year, with 30 of the jobs as engineering positions. You can view all their job openings on Built In Chicago.
Channel IQ is an online management platform for retailers and manufacturers to see where their products are sold and to monitor prices among secondary sellers.
Shepard said Channel IQ has two core competencies: having the world’s largest catalog of product data online, and having a database of retailers and people who work at retailing associations. Channel IQ reported in their release that the investment would help accelerate the “world’s largest retail data exchange.”
“There’s kind of a larger problem going on and we didn’t necessarily know we were solving the solution,” Shepherd said. That solution is finding “better data and more actionable data.”
By understanding second market online sellers, Channel IQ helps retailers assess if they are good sellers. And for that, there’s a person on the other end of the channel to communicate with.
“We have all this data about companies, contacts and products being sold online,” he said. “So manufacturers and retailers can organize this data, fix problems and react to opportunities, much like you’d go to LinkedIn to go to talk to someone about their background and talent, then connect.”
Channel IQ works with companies such as Panasonic, LG, Philips and New Balance. Michael Denison of American Rec testified to the company that Channel IQ tools and methodologies helped better protect our American Rec’s brand and channel resellers.
Moving beyond price management, the company’s efforts in relationship management help connect a $10 trillion global retail industry and a $1 trillion e-commerce industry. “We’ve already connected everyone in our system. So instead of just selling information, we’re also selling a network,” Shepherd said.
While Shepherd said he’s looking to expand his platform after recognizing new potential, Drive Capital partner Chris Olsen said he’s focused on having the company does what it does best. “They’ve already built their company this far,” he said.
Channel IQ started sales in 2009. They took angel investment in 2010, and additional investment in 2012. “We’ve really never taken institutional, we’ve built this business up fairly conservatively,” Shepherd said.
Though Olsen said the company was built “on a shoe string,” the company reported in a release that they have had an 800 percent growth in revenue since 2010.
This is the first Chicago firm that has publicly announced funding from Drive Capital.
Drive Capital was started by two former partners at Sequoia Capital to invest in Midwestern companies that have a global market opportunity in the technology world. Olsen said the firm understands the struggles of raising capital in the Midwest.
When it comes to Shepherd, “it is clear that he is building a technology for manufacturers and retailers that nobody’s ever built before,” Olsen said. Drive Capital invests in firms that are solving massive market problems that will generate several hundreds of millions in dollars over time.
“We felt that we would ultimately get an investment on one of the coasts just because the investments were stronger,” Shepherd said, while glad to keep the investment local.
“Channel IQ is emblematic of what we see across the whole Midwest,” Olsen said in regard to the difficulty of finding Midwestern investment. He said the firm is excited to begin investing in Chicago.