Home > PR > Muck Rack Lands a Whopping $180 million in Funding [PR Tech Sum]

Muck Rack Lands a Whopping $180 million in Funding [PR Tech Sum]

Summary of PR tech news for this month: Muck Rack’s big raise, Meltwater reviews “strategic alternatives”; PR tech mentions include Onclusive and Semrush

The PR technology space can be in some respects, divided into Davids and Goliaths.

On one side, we have giants, which are backed by PE firms, holding companies, and in a couple of cases have access to the liquidity of public markets. They have seemingly infinite resources and insurmountable access to talent and machinery.

On the other side, we have small independent companies trying to break into the space. Some are pure-play vendors focused on a niche, while others strive to be all-in-one. Their ability to win, however, seems as improbable as David’s victory over Goliath.

Yet David’s victory wasn’t improbable, as Malcolm Gladwell once wrote, and later relayed in this Ted Talk (I highly recommend watching it). In fact, everything we’ve come to believe about this story might be wrong – along with two key themes:

First, David isn’t an unlikely hero. He is a practiced expert with a sling. This is a weapon that has ballistic characteristics that mirror the stopping power of a modern handgun.

Second, what we all perceive to be a source of Goliath’s strength, his size, is caused by an abnormality that brings with it a weakness; he’s blind.

It’s not a perfect analogy, but I think we are seeing something like this in the PR space.

The small independent companies may not be so small anymore. They may in fact have the decisiveness to spend marketing or R&D where it matters.

On the other side, all the dealmaking has weighted down the giants with more than they can integrate. The equity owners wrote big checks for those transactions – and they aren’t inclined to write another. What makes them appear strong, is actually a weakness.

Onward with the PR Tech Sum

1. Muck Rack lands $180 million Series A round

Muck Rack announced a $180 million Series A minority investment from Susquehanna Growth Equity earlier this month. This is the first outside investment the company has taken, which has been boot-strapped its founding in 2009 by Galant and Lee Semel. Two managing directors from Susquehanna will join the Muck Rack board of directors.

The company was imprecise about what it intends to do with the funding, other than to say it “will support continued growth and enhance offerings for global customers.” Typically, a Series A is an investment made by venture capital firms in companies that are still in the early stages. It’s often used to build out a product, hire talent and mature a company’s processes. Clearly, Muck Rack is more mature and so and it’s a surprise to see the company take this kind of money.

It’s worth pointing out this is a large investment by any standard, so it’s incredible to see this sort of money poured into a company in the PR tech space that doesn’t involve an acquisition. Similarly, the timing matters too. Investors have pulled back amid economic uncertainty. There just aren’t a lot of companies than can land a even few million dollars in funding in this environment right now.

Nothing to compare

To place this in context, Propel, a startup with an all-in-one tool raised $4.5 million in a seed round (typically prior to a Series A). Prior to that, TrueScope, which is a pure-play monitoring company – led by an experienced CEO – raised $6.2 million in a Series A.

Here’s one more: Vocus was one of the earliest technology companies in the PR tech space. The company provides a useful context for understanding the scale of Muck Rack’s funding announcement this month. Sure, it’s an older comparable, but one of the few companies in PR tech that grew up with venture capital went IPO and ran for years after as a successful company.

Vocus raised a little more than $13 million over two rounds of venture capital funding according to Crunchbase. It survived the dot-com crash and would later raise $45 million during its IPO with a valuation of $133 million.

But in its last full year as a publicly traded company in 2013, prior to its sale to GTCR (and eventual merger with Cision), it did roughly $187 million sales or a little more than the Muck Rack funding round. The point is, Muck Rack must have both numbers and a sound equity narrative to justify this sort of funding.

While the company hasn’t shared hard numbers it did put out percentage growth. It claims it saw “75% year-over-year revenue growth in 2021, and more than 300% revenue growth over the three-year period from 2018-2021.”

I didn’t see any customer numbers, but CEO Greg Galant previously told me Muck Rack had “thousands.” Muck Rack employs “more than 200” people.

Quick takes

Oddly, coverage of this in the traditional PR trades was scant. I didn’t see any coverage in PRWeek, Ragan, PR News, or PRovoke. O’Dwyer’s ran a news brief but it doesn’t show up in search. Fortunately, there are some other publications that dug into this including Axios and TechCrunch.

Axios, which seems to have done an actual interview, which is rare these days, noted:

“The money will also help co-founders, chief executive officer Greg Galant and chief technology officer Lee Semel, as well as early employees, liquidate some of their investment.”

It also reported:

“It soon plans to release its own API (backend computer interface) that makes it easy for companies to integrate Muck Rack’s analytics dashboards with a company’s existing marketing stack.”

And with a nod to the Muck Rack origin story:

“It will also continue to invest in the free services it offers for journalists and creators to showcase their work.”

TechCrunch summed up the story in the messy context of social media opinions sometimes passing as news:

“The big question for a company like Muck Rack — or its competitors for that matter — is how they will evolve with the times to reflect that mass communications landscape.”

Perspective

Cision ought to be very nervous about this investment. Muck Rack now has the resources to compete on the same playing field with a modern and homogeneous technology platform. And they don’t have the baggage Cision has accrued with its patchwork of acquisitions, high executive turnover and frequent change in equity ownership.

I took an in-depth look at Muck Rack for a PR Tech Briefing a couple of years ago: Muck Rack Aims to be an All-in-One PR Tech Platform for Media Contacts, Outreach and Monitoring.

I also put together a presentation for a conference of agencies interested in purchasing technology earlier this spring that might be of interest: The PR Technology Landscape 2022.

2. Meltwater reviews “strategic alternatives”

Meltwater announced review of strategic alternatives. According to a news release:

“The board of directors has appointed J.P. Morgan and DNB Markets, a part of DNB Bank ASA, to advise on and evaluate certain broader strategic alternatives for the Company. Indicative proposals have been received, but the discussions and evaluations are at an early stage, and there can be no certainty whether (or when) any transaction, initiative or event will materialize.”

A review of strategic alternatives is often – but not always – a code for “we’re hanging out a ‘for sale’ sign.

Meltwater, which is publicly traded in Oslo (MWTR) reported Q2 and H1 earnings in late August. The company paints a pretty rosy picture including $110 million in revenue for the quarter and “12% year-over-year” but flat compared to Q1. It also posted a smaller loss of ~$200,000 for the quarter compared to Q1 but has tallied losses of $79 million for the trailing 12 months (TTM), according to Yahoo Finance.

The company reiterated guidance for the full year: It expects to book $440-$445 million in revenue for the full year 2022.

It’s worth bearing in mind, I’ve observed before, Meltwater seems to be pursuing the larger marketing space outside of PR and comms.

3. PR tech mentions

  • Meltwater launches “visual listening.” It’s hard to search or set up alerts for images. If a publication puts your logo on its site without mentioning the brand name, you may never see it. Meltwater aims to fix that with “visual listening and company search capabilities.” This allows customers “to search and analyze images, identifying specific logos, celebrities, memes, emotions, age groups, and more.” This blog post explains how software can recognize images.
  • Presspage rolls Media Inquiries. Media Inquiries is a feature of Presspage to centralized inquires and manage responses. Right now, it’s manual, meaning if you get an inquiry, you have to type it into Media Inquiries. From there it works as something like a project management and workflow tool to assign and track media relations tasks. A company representative indicated they hope to add this to their online newsroom offering in the future, so when a journalist makes an inquiry, it’s already in the system.
  • Muck Rack fetches old podcasts. Muck Rack said users can now play podcast episodes “dating back to the beginning of a podcast’s RSS feed.
  • Onclusive names new CEO after resignation. Onclusive named Rob Stone as CEO following Manuel Moerbach’s resignation. Moerbach, who was named CEO in February of 2022 following a three-way merger – and moved to London for the job – will  “relocate from London back to New York to re-establish his family balance.” Stone joins Onclusive from Escalent, and analytics consulting firm and will relocate to London to take the reins.
  • Semrush names Bill Wagner to its board. Semrush (NYSE: SEMR) appointed Bill Wagner to its board as an independent non-executive director. Wagner is the former CEO of LogMeIn, which grew from a $140 million company to $1 billion in sales – and eventually sold to a pair of private equity firms for $4.3 billion in 2020 – under his tenure. Wagner also served as the CMO, and later COO of Vocus. Semrush acquired Prowly, a PR startup based in Poland, about this time two years ago. While I was initially optimistic about the idea, I haven’t seen much come of it.

4. Content picks

Here are some interesting posts by or about the PR technology community that stood out to me this month:

  • “PR was…left behind, in terms of marketing innovation,” says Propel CEO Zach Cutler in an interview with MarTech Cube. “Earned is the most important channel, for a variety of reasons, including consumer hunger for credibility, the death of the cookie, GDPR, and unsustainable high costs, which are plugging the ad industry.”

* * *

Have an interesting announcement from a PR technology vendor? Here’s the list of PR technology companies I’m watching and here’s how to get on my radar.

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Image credit: Pixabay

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