If 2020 was a year of change for Nudge Coach, a Richmond-based coaching platform, 2021 is shaping up to be a year of growth.
The startup reported a $525,000 raise in February, funding that co-founder and president Phil Beene said will clear the way for the company to “fully scale.”
With the recent funding, Beene said they plan to hire sales, marketing and back-end developer roles. The company is also planning a Series A raise in mid-2021.
“This is a bridge to help us nail down a few key hires … to put us in position to pour fuel on the fire,” he said.
Nudge Coach, co-founded by Beene, Mac Gambill and Chris Garson, enables individuals or organizations to build a customized coaching app to engage with clients. Their clients tend to be small businesses like nutrition and career coaching companies — “really any type of program that involves behavior change or trying to reach a goal,” Beene said.
Nudge Coach began last year with a big change, when the company “spun out of” a partnership with Salveo Diagnostics, a Richmond-based lab testing company. Attempts to build a combined solution didn’t pan out, Beene said.
The company faced a high client turnover rate as it set out on its own. The co-founders decided to restructure the business model to offer a freemium service, letting clients try out the app for free with a couple of customers before upgrading to a paid plan.
They then became “laser-focused” on lowering their problematic churn rate, Beene said.
That focus paid off. By the end of 2020, Nudge Coach had reduced churn by 70% and arrived at their goal of 5% or lower monthly churn.
“I think that did exactly what we were hoping,” Beene said. “We wanted to build a foundation for a scalable SaaS business.”
Toward the end of last year, Nudge Coach and Validic, a Durham, North Carlina-based healthcare technology platform, announced a technology partnership to make it easier for clients to launch a mobile engagement solution.
Nudge Coach began 2021 by launching a major update to its own platform.
“Anything that’s aided by creating and tracking better habits or personal accountability, that’s our bread and butter,” Beene said. “But where we’ve kind of innovated … now you’re able to actually build full-on programs into your own coaching app using our platform.”
Looking ahead, Beene anticipates a boost in their client base, as members of the creator economy explore coaching as a dynamic alternative to online courses.
“There’s a lot more people entering our space, who you wouldn’t traditionally think of as coaches, who are going to be looking for a solution like this,” he said.
For example, he said, a professional gamer could customize the app to coach people on improving their video-gaming skills.
“Coaching, especially when we started, felt like a little tiny niche,” Beene said. “Now it’s expanding really fast.”