Today, it’s not enough for students to spend their university years studying, partying, and racking up astronomical debts. For young people looking to get ahead, college is the place where ideas flourish, where innovations take root, and where billion-dollar businesses have their foundation. In 2015, a Ph.D. student at the Massachusetts Institute of Technology took the problems surrounding data systems research and came up with a radical solution. Fast forward 5 years, and that solution lies at the heart of Instabase, one of the tech world’s fastest-growing enterprises. Designed to make computers work for people, rather than the other way around, the growth potential of the company is enormous- as was demonstrated at the tail end of 2019 when it achieved a valuation of over $1 billion. Read on to find out more.
1. It was founded by Anant Bhardwaj
Instabase got its start in 2015 when Anant Bhardwaj, a then 28-year-old Ph.D. student at the Massachusetts Institute of Technology Computer Science & Artificial Intelligence Lab, began to question why private customers had Apple Inc.’s App Store at their disposal, but companies were left out in the shade. “If a smartphone allows you to buy an app for a massage, why can’t a bank buy an app for income verification?” he recalled asking himself to the Economic Time. “At big businesses, “Why is everything custom-built?”
2. The first version was a success
Supported by David Karger and Sam Madden, two respected professors in the field of algorithms and databases, Bhardwaj developed the initial version of the Instabase platform (DataHub) as part of his Ph.D. studies. Impressed by the speed and ease of use of the application, organizations such as NYC Moreland Commission, NYC Accountability Project, MIT CSAIL, MIT Lincoln Lab, MIT Media Lab, and MIT Getfit project quickly adopted it, spurring Bhardwaj to begin considering the project’s potential beyond the scope of his Ph.D. program.
3. Pete Sonsini and Jerry Chen were the earliest investors
After developing his ideas into a sound business plan, a professor at the Massachusetts Institute of Technology Computer Science & Artificial Intelligence Lab introduced Bhardwaj to NEA venture capitalist Pete Sonsini. Impressed with the premise of Bhardwaj’s fledgling business, Sonsini in turn introduced the student to Greylock Partners’ Jerry Chen, who’s since described the company as “profoundly different” from other similar research tools. Together, the two Venture Capitalists invested $3.78 million into Instabase, allowing Bhardwaj to drop out of college and concentrate full time on developing the start-up.
4. Its drawing lessons from WeWork
In September 2020, the commercial real estate company WeWork formally announced it would be withdrawing its S-1 filing and postponing its IPO. The decision came after months of internal turmoil, the resignation of its CEO Adam Neumann, and concerns over the outlook for the business after its valuation was revealed to be just $10 billion, $2.8 billion less than the total it had raised since 2010. Shortly after the announcement was made, the New York Times summed up the consensus surrounding the company’s failed efforts to go public by calling it “an implosion unlike any other in the history of start-ups". While it may have been a disastrous period for WeWork, the lessons learned are serving to benefit the new tide of startups, Instabase in particular. “Our goal is not to be in some illusion because we raised at a high price,” Bhardwaj has said. “If we start behaving that way, we will fail. But if we know we have to catch up to that valuation by executing, we will succeed.”
5. It's part of a growing wave of high-value start-ups
The age of austerity clearly isn’t harming the potential for big-time investments. 2019 saw some record-breaking venture deal sizes in every sector and stage, putting startup investment at over $100 billion for a second consecutive year. Other companies besides Instabase to benefit include the Texas-based energy services company RigUp, which managed to raise a fresh wave of funding in October 2019 at a $1.9 billion valuation, Australian online design platform Canva, which raised investment at a $3.2 billion valuation, and San Francisco-based online banking startup Chime.
6. It's building a sales force
According to Bhardwaj, Instabase has some big plans for the future, plans that could see a short-term downturn in profitability, but an upwards trend in long-term growth. Although it currently turns on operating profit, Bhardwaj plans to use large amounts of its latest investment to build a sales force, something he hopes will allow the company to extend its current customer base (which is currently focused around the financial services) to include the sectors of government, legal, healthcare, retail and logistics.
7. It may be novel, but it’s not unique
Since its inception, Instabase has premised on the idea of providing a unique solution to a historically unsolvable problem. While its approach and scale may be novel, however, its ideas aren’t entirely unique. Shortly before going public, Cloudera launched a service that allowed collaboration between data scientists. Data science platform Domino Data Lab, meanwhile, provides a similar data science platform used by model-driven companies, while Plotly caters to a similarly broad crowd as Instabase with its online data analytics and visualization tools.
8. It welcomed Barry Sowerwine on board in 2019
Barry Sowerwine, former SVP of North America Sales at the market-defining Tableau Software, jumped on board the Instabase bandwagon in December 2019. Having spent 20+ years in the industry (and helped 4 companies go public in the process), Sowerwine clearly knows a thing or two about the world of high- tech- a world he now sees Instabase as one of the leaders of. “My 7 years with Tableau were challenging, but magical – it was the most rewarding journey of my career. I had more or less accepted the idea that no other experience would ever come close. I just couldn’t envision another technology advancement that would have the market-defining characteristics and overall impact of Tableau,” he’s said. “I now believe I was wrong. I believe Instabase is that company. Instabase will create a new category and help define computing in the Enterprise for many years to come. We have technology that will improve the human work experience.”
9. Its CEO has a 100% Glassdoor approval rate
If you want to truly understand how a company ticks, Glassdoor can be hugely helpful. Revealing as it does the true, no holds barred opinions of employees past and present, it can make or break a company’s reputation- at least in the eyes of potential and future recruits. For the moment at least, Bhardwaj can rest easy – not only does the CEO enjoy an outstanding 100% approval rating, the company boasts some truly glowing reviews (with comments such as “As a startup, it's hard to balance building a product with everything else that needs to be done for the company, but leadership has demonstrated that it cares an enormous amount about its employees and are committed to always improving and taking feedback as the company grows. I feel lucky to be at a place that values me as a person and employee, has allowed me to make mistakes and learn a ton, and where I always feel comfortable speaking up, whether it's about engineering, culture, or just taking a vacation,” typical of the general standard), not to mention a 100% NPS score.
10. It acquired Cloudstitch in 2018
In February 2018, Instabase made its first major acquisition when it incorporated web development platform Cloudstitch. Like Instabase, Cloudstitch began as a research project at MIT, before growing into a venture-backed startup serving the developer community.
11. It raised $23 million in 2017
In 2017, CNBC reported that Instabase had raised $23 million in a Series A round led by Martin Casado of Andreessen Horowitz, one of Silicon Valley’s biggest venture capital firms. “Instabase is a company that really resonates with me personally,” Martin Casado, a general partner at Andreessen Horowitz told CNBC about the investment. “It’s a first-time technical founder, tackling an incredibly challenging technical problem, in an emerging space that can have huge industry-wide impact.”.
12. It achieved unicorn status in 2019
In October 2019, Instabase announced it had raised $105 million Series B led by Venture Capital firm, Index Ventures. The round, which valued the tech firm at over $1 billion, bought the total raised by Instabase from its inception in 2015 to $132 million, as well as introducing Index Ventures partner Sarah Cannon to the company’s board.
13. The financial industry forms its core customer base
Since its inception, Instabase has resonated most loudly with the financial services industry, and it can now count over half of the top ten financial institutions in America, not to mention a score of global banks, among its customers. While banking has helped secure Instabase’s growth, CEO Bhardwaj hopes to grow the business in other key segments, claiming the technology at its heart is as applicable to sectors such logistics, healthcare, government, and telecommunications as it is to the financial industry.
14. The potential for growth is enormous
Peter Sonsini, general partner at New Enterprise Associates, helped seed Instabase along with Jerry Chen back in 2015. 5 years later, he remains one of the company’s biggest cheerleaders, even going so far as to claim it “will lead the biggest enterprise transformation yet.” Writing on NEA’s blog, Sonsini commented “Instabase has generated a tremendous amount of interest while divulging relatively little about what they’re building. This is partly because Anant is a great storyteller, but there’s a whole lot more to it than that. Even from 30,000 feet, it’s not hard to see that Instabase is building the right product at the right time. It sits at the intersection of three of the hottest and transformational software disruptions in the world today: digitization of business processes, low-code/no-code, and AI.”
15. Its first sale was worth $1 million
If you want to succeed, you can’t short change yourself. Convinced of the potential of his product, Bhardwaj aimed high, right from the very start. During one of his first-ever sales, Bhardwaj stuck a $1 million asking price onto the deal- an audacious sum, but one he managed to secure after demonstrating how his software would save the customer over $8 million a year in people costs. At the time of closing the sale, Instabase had only 7 employees, making it one of the highest gross profit companies per employee in NEA’s portfolio history.
16. It’s got massive implications for efficiency
As early investor Jerry Chen notes, Instabase promises to revolutionize how companies work, eliminating time-consuming, expensive, and error-prone workflows by integrating a series of intelligent applications into one single platform. After incorporating its software into their business processes, companies can expect a radical increase in productivity. Since Standard Chartered adopted Instabase’s software, they’ve managed to cut the onboarding time for new Corporate and Institutional clients by 33 days, and saved over 300 hours a week in labor in their retail banking practice for small and medium enterprises.
17. It offers an app store
At its core, Instabase is a platform for companies to build customizable apps designed to automate different aspects of their business. In addition to its platform, it also offers an ever-growing app store of pre-packaged business apps targeted at different sectors. Current apps include Income Verification, Adverse Media Analysis, Identity Verification, Trade Finance, Contract Analysis, and Financial Spreading.
18. It sponsors Professor Widom's Instructional Odyssey
In 2016, Jennifer Widom, a Stanford computer science professor and school of engineering dean, embarked on a one-year sabbatical that saw her travel the world offering free courses, workshops, and roundtables focusing on the areas of big data, design thinking & collaborative problem-solving, and women in technology. Since then, she’s continued her educational travels on an occasional basis, providing motivation and education in equal measure. Her list of supporters and sponsors is littered with big names such as Google, ACM, Amazon, Sandford University, along with the slightly smaller, but increasingly influential, name of Instabase.
19. It’s improving education delivery
Private companies aren’t the only ones catching onto the benefits of Instagram. Having got its start at a university, Instabase is, perhaps fittingly, now being used in educational establishments up and down the country, with its i-python style notebooks in particular gaining increasing traction in teaching circles. "Many universities use Instabase for teaching classes—it's very diverse," Bhardwaj confirmed to Pitchbook.
20. New plans are afoot
Instabase may be based on the idea of delivering solutions to improve the work experience and maximize efficiency, but the way it delivers its mission statement is ever-evolving. Since its inception, it's grown to include the first-ever out-of-the-box app store for businesses, and next plans on opening its platform to 3rd party application developers.
Written by Allen Lee
Read more posts by Allen Lee