A maker of administrative software for employee mentorship programs is growing following a more than $80 million private equity round, Central Ohio's largest so far this year for a tech company.
MentorcliQ Inc. last raised $6.3 million four years ago, but the latest round multiplies capital raised by fivefold to a cumulative $100 million in the company's 11-year history.
In a year when funding rounds and valuations are slowing nationally, MentorcliQ demonstrated enormous market potential on a track record of fiscally responsible growth, said Chief Marketing Officer Gracey Cantalupo.
"We've been able to prove mentoring can actually increase employee retention," Cantalupo said. "We want to make mentoring a requirement of any enterprise's talent strategy. It's not just a 'feel-good' thing; we can measure it."
PSG, a growth-focused private equity firm with its main office in Boston, led the round, which closed late last year but wasn't disclosed until spring.
Repeat investors Rev1 Ventures and Plymouth Growth also participated.
About a dozen of the company's 120 employees are in Central Ohio, and the Short North office serves as a convening place, including for quarterly meetings to bring staff or select teams to Columbus.
"They love the culture, they love our office," Cantalupo said.
Co-founder and CEO Phil George was not available for comment; he was on a yearly visit to the company's software development team based in Armenia with CTO Armen Orduyan.
The round earlier this year was the largest of 10 deals for Central Ohio companies announced for the quarter that ended March 31, according to the latest VentureMonitor report from PitchBook and the National Venture Capital Association.
The $25 million raised by Triple Whale, dashboard software for e-commerce retailers, was next, followed by several smaller deals ranging from $1 million to $4 million, for a total of $116 million in the quarter, PitchBook data indicated.
PSG has other portfolio companies in human resources tech that are farther along in their growth trajectory, providing knowledge for MentorcliQ, Cantalupo said. Besides that, the firm doesn't exhibit the pressure toward acquisition ascribed to most PE firms.
"They didn’t have to re-learn our business in the HR tech space," she said.
The subscription software automates many steps for an employer to assign a personal mentor to new hires and keep them in contact consistently.
"I want MentorcliQ to be the benefit (new hires) ask for by name," Cantalupo said.
Using the proceeds, MentorcliQ will explore acquisitions to speed additions to its features, Cantalupo said. For example, clients have asked for support for diversity, equity and inclusion programs.
Key hires will come in sales, marketing and product development.
"We've been growing responsibly and been very responsible in our hiring practices as well," Cantalupo said.
"It's definitely more of an aggressive growth plan than we've had in the past," she said. "With the injection of capital we feel we can make it happen."
Fortune 500 clients with employees in some 17 countries use the software.
C-suite expansions made possible by the round include Chief Revenue Officer Chris Bondarenko, hired in January.
Cardinal Health Inc., one of its first customers, is still with it. Clients are mostly enterprises with more than 2,000 office-based employees. Other customers include Bacardi, Campari and the maker of Bic pens.
“MentorcliQ has created a highly differentiated product offering and exhibited significant leadership in the mentorship technology space,” Chris Nesbitt, principal at PSG, said in a news release.
The round is a big win for Rev1, the Columbus nonprofit venture development firm that advises startups as well as investing.
"I am personally proud of our long relationship: We were their first institutional investor," Rev1 CEO Tom Walker said in a statement. "We’ve been able to watch and support them from the very beginning. The work they are doing is admirable – and I am excited to see it continue.”
MentorcliQ was among the investments from Rev1's 2016 fund – a portfolio that includes exits such as Updox and Deep Lens.
