Here's one way to avoid venture capital when running a startup: spin it out of an existing company. That's what happened with Explorics, a new marketing tech startup based in Manchester, N.H., that began as a software project at marketing agency GYK Antler.
Evan York, Explorics CEO and co-founder, told BostInno that before the startup was created, he had been brought into GYK by his brother Travis, the agency's CEO, to build a data analytics platform that would help give GYK clients more transparency into the performance of their marketing campaigns.
"I did not have the desire to follow the typical agency model of hiring an army of analysts," said York, whose other brother Kyle is an executive at Oracle-owned Dyn.
With the goal of giving marketers an easy way to report their company's marketing performance, the Explorics platform combines data sources from disparate channels, including social media, into a unified, visual dashboard. The platform also provides recommendations on things like when to post on social media.
"We recognized a great opportunity to expand outside that ecosystem in the agency world."
"It’s the senior marketing executive who needs to understand everything that’s happening and then be able to report it out," Adam Hollis, Explorics' chief revenue officer and co-founder said.
While the analytics platform received a positive response from GYK's clients, there was a problem: the agency had a finite number of clients. That meant the potential reach of the platform was limited unless the agency decided to make it a larger focus.
Then, this past December, the platform landed its first non-agency client, which gave York and Hollis the signal for a bigger opportunity. After talking it over, the agency decided it would spin out the platform as its own startup, Explorics.
"We recognized a great opportunity to expand outside that ecosystem in the agency world," York said, since a lot of marketers were having the same challenges as GYK's clients.
Because the technology was already developed in-house, the company had no need to bring in venture capital like a regular software startup would. Instead, the company was funded by GYK, which is Explorics' largest equity holder, and York's two brothers. The company also shares office space with GYK, which also provides marketing resources.
Most importantly, Explorics was able to get early customers during its incubation at GYK.
"Now it’s just an opportunity for us to bring this to the broader market," York said.
